With the stroke of a pen Thursday, Burlington Mayor Miro Weinberger brought the city $6 million closer to resolving the Burlington Telecom case that’s hung over the city’s finances since he took office.
The deal, approved by city council Wednesday, provides partial financing for the city’s $10.5 million settlement with Citibank, which sued Burlington after the city failed to pay back more than $30 million in borrowed funds.
The funds were part of a wider debacle that swept city government when it came to light that the city-owned Burlington Telecom was hemorrhaging money and being inappropriately subsidized by other city funding pools.
The settlement, announced in February, was a major step in the Weinberger administration’s continuing efforts to bring the city’s finances back from the brink of a “junk bond” credit rating from Moody’s.
With $6 million of the $10.5 million settlement funded, the city plans to pay much of the difference using revenue from the much healthier Burlington Telecom.
Weinberger said about $1.5 million in taxpayer money may be used to complete payment on the settlement, but that the expenditure would be a sound investment Burlington’s financial stability.