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BT Advisory Board Preps For Sale, Local Co-op Is Ready
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Last spring, the BT Advisory Board (BTAB) released a report that recommended the city of Burlington, Vermont, try to find a buyer with local ties to purchase its network with the troubled past. As the deadline draws near and the city seeks out the right entity to take the reigns, the community holds on to that goal. Keep BT Local!, the local organization that has been working since 2012 to turn the network into a cooperative, has announced that it will make an offer on the network.
Alan Matson, vice chair of Keep BT Local, said the local co-op will put forward an offer for the utility. The member-funded effort likely won’t put forward as substantial an offer as a private tech company would, Matson acknowledged. Still, he said, “We hope to be one of the finalists in July.”
Matt Cropp, a member of Keep BT Local, said the co-op model would “build broad-based community wealth” and urged Burlingtonians to pitch in. He said he was willing to commit a portion of his retirement savings to the cause.
Matson and Cropp were among a group of citizens who attended a public meeting with Advisory Board members to discuss options and offer advice on choosing a buyer. As expected, many of the attendees described the network as a valuable public asset and expressed concern that it not fall into the hands of a large, absentee telecommunications conglomerate such as Comcast.
Choosing Finalists
As part of the process, the Board voted to send its proposed sale process to the city council for approval. Last year’s report established a set of criteria which the city will use to evaluate interested parties. Once the city council approves the process they propose, the BTAB will create a list of interested buyers and officially launch the sales process. They intend to create a list of finalists who would then present publicly before the city council and, by the end of July, the council would choose a buyer.
The sale to a private entity must be complete by January 2018 in order for the city to obtain the highest possible portion of proceeds from the sale, 50 percent. After that date, the city’s share decreases. Blue Water LLC, a company formed to provide financing so the city could pay off its settlement with Citibank, will obtain an increasing amount of the funds from a sale that occurs later than the deadline. Blue Water can also sell to whomever it chooses, if the city cannot find a buyer by the deadline.
Citibank sued the city for $33 million when it was revealed that a prior administration had covered up financial problems and mismanagement. In order to settle, a local businessman formed Blue Water, paid off the settlement, and now leases the network to the city.
Love It Local
Regardless of what entity takes over BT, it has clearly made its mark on the local community.
"We want to find the right buyer, the right partner and not just identify the maximum amount of potential buyers," board member and city council president Jane Knodell said…
"I think there's a consensus that just selling to the highest buyer is not what we're looking for because we need to weigh that against the longer term benefit of having a company that works closely with government in Burlington and local businesses to build a strong local economy," Knodell said.
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