Burlington Telecom
| Company type | Municipal company |
|---|---|
| Industry | Telecommunications |
| Founded | 1980s |
| Headquarters | Burlington , United States |
| Products | Television, telephone, internet services |
| Owner | City of Burlington |
Burlington Telecom operates as a municipally owned telecommunications company delivering television, telephone, and internet services throughout Burlington, Vermont via an extensive citywide fiber-optic infrastructure.
History
The concept of establishing a fiber-optic network linking every home and business in Burlington originated in the 1980s. However, multiple efforts during the 1990s failed primarily due to insufficient financial backing. Eventually, telecommunications specialist Tim Nulty was engaged as a consultant and later appointed as General Manager of Burlington Telecom, which functions as a department within the city government. The network’s construction occurred in phases, achieving profitability for its initial phase by 2003 and for the first two phases by 2006. These milestones led city officials to expect considerable revenue growth in the future.
In September 2009, it was revealed that Burlington had utilized $17 million from municipal funds to support Burlington Telecom operations starting in early 2008. This action breached the state licensing agreement because the loan was not repaid. As a result, a forensic audit was initiated alongside a criminal referral to the Vermont Attorney General’s office. Additionally, two private citizens filed legal action demanding repayment.
A City Council committee concluded in January 2010 that Burlington Telecom was unable to manage its outstanding debt. By February 2010, the company defaulted on an interest payment of $386,000 owed to lender CitiLeasing.
On March 11, 2019, the city council approved the transfer of ownership of Burlington Telecom to Champlain Broadband, a subsidiary of the privately held Schurz Communications. The transaction, valued at $30.8 million, is expected to assist the city in recovering $7 million of taxpayer money and settling loans from Citibank and Blue Water Holdings.
Al Jazeera
Burlington Telecom’s cable service featured local and complimentary channels. In January 2007, it incorporated Al Jazeera English into its lineup without incurring costs for the network feed.
In 2008, controversy emerged when Burlington Telecom proposed removing Al Jazeera English (which was later replaced in the U.S. by Al Jazeera America) from its basic cable package. The city council along with then-Mayor Bob Kiss deferred the decision for further deliberation. A public hearing on this matter was broadcast on Al Jazeera English itself. After conducting two public meetings, the oversight committee overseeing Burlington Telecom resolved to maintain the channel within selected cable packages.
By 2010, Burlington Telecom had failed to make $1.5 million in bond interest payments and owed $17 million to the city of Burlington. Subsequently, Moody's downgraded Burlington’s credit rating two levels—from Aa3 ("high quality") to A2 ("upper medium")—and also lowered the rating for Burlington International Airport. The Vermont Public Service Commission called for a criminal investigation into the matter, prompting the resignation of the general manager.