Neighbors,
It has been a busy summer for the City team. We have made progress on a number of initiatives to advance Burlington toward a greener, more just, and more affordable community. Over the last few weeks, I have been happy to celebrate 40 years of the Church Street Marketplace, testify before members of the state legislature to support equitable school funding, encouraged the School Department to advance the analysis of a permanent downtown Burlington High School, and more.
I hope that in the weeks ahead you will engage and consider supporting two important proposals we’re bringing forward to answer Burlingtonian’s call for robust and sustainable infrastructure investment: the BED NetZero Revenue Bond, and a new General Obligation bond to fund the City’s continued Sustainable Capital Plan investments. These new bond proceeds will be invested in streets, sidewalks, bridges, civic assets, IT and public safety infrastructure, and addressing the deferred maintenance at Memorial Auditorium. If approved by voters, these bonds will be a fiscally responsible path for us to make robust investments across the City and make meaningful progress on our climate goals.
NetZero Revenue Bond
Among the first of its kind nationwide, the Net Zero Energy Revenue Bond proposal was recommended by the Burlington Electric Commission by a 5-0 vote before receiving unanimous approval from the Board of Finance and City Council.
The Net Zero Energy Revenue Bond proceeds would support numerous investments, including $17.5 million to support projects that help advance progress toward Burlington’s Net Zero Energy goal. Additionally, the proceeds would invest $7.8 million to fund grid upgrades supporting reliability and manage new loads from strategic electrification, several renewable energy generation plant maintenance and upgrades, and investment in electric vehicle charging and demand response infrastructure.
In the immediate future, the Net Zero Energy Revenue Bond would reduce rate pressure significantly for BED customers relative to a scenario where BED made the above-mentioned investments without the bond. Looking further out, new revenue from strategic electrification projects between FY23 and FY25 is projected to contribute approximately 40% of BED’s obligation over the 20-year debt service life of the bonds as other BED debt is being retired. As a result, BED projects no upward rate pressure as a result of these new revenue bonds for at least five years, and very modest impact on rates thereafter.
Capital Investments
Prior to the creation of the Capital Plan in 2015, Burlington faced numerous challenges as a result of chronic underinvestment and delayed maintenance of critical infrastructure. Over the first five years of implementation, the Capital Plan has driven investment in key City infrastructure including doubling street reinvestment, replacing over 14 miles of sidewalk, and rehabilitating virtually the entire bike path (with the final major unfinished section in Oakledge Park in construction right now). Over the next three years, Burlington faces over $151 million in capital needs to address deferred maintenance at Memorial Auditorium, replace key fleet vehicles such as three new firetrucks and new sidewalk tractors, maintain our elevated investment in streets and sidewalks, advance the City’s Walk/Bike plan, build major transportation projects (like the Shelburne Road rotary now under construction) and more.
We are proposing these $151 million in infrastructure projects be funded in-part through a $40 million General Obligation bond, and that $3.5 million of those bond proceeds would in turn leverage an additional $60 million in State and Federal dollars for landmark projects like the Railyard Enterprise Project – bringing us up to two-thirds of needs funded before seeking additional grant dollars or using City revenues.
We are proposing a special election in the coming weeks for these bonds for several reasons. First, the pandemic has set our infrastructure planning back by one year resulting in a lower rate of infrastructure investment this construction season, and waiting until spring for a vote will impact negatively a second straight construction season. Further, amidst a recovery involving significant financial uncertainty, we think it is prudent to act now while we are continuing to enjoy historically low interest rates.
While we are working hard to leverage tens of millions of dollars from other sources that will not impact your property taxes, we will need to contribute to continue this generational progress renewing our infrastructure. When fully drawn down in three years the projected cost of this new bonding for the average Burlington property taxpayer is approximately $13 a month. I look forward to answering any questions you have about this plan in the weeks ahead.
ARPA Investment
The City of Burlington expects to receive approximately $27 million American Rescue Plan Act (ARPA) allocation. About half of those funds have been committed to ongoing public health and economic relief efforts, and to fill City budget holes created by the pandemic recession. We need your help making sure that we get the most out of the opportunity created by this federal investment. Our Economic Recovery Director and her team will be announcing a public engagement plan around the investment of the City’s remaining ARPA funds in the next few weeks. The Economic Recovery Team has studied the US Treasury rules, consulted with local legal experts to clarify interpretations, researched how other municipalities plan to use funds, and carefully monitored state and federal programs to avoid redundancies.
The next steps in the public engagement process will include convening an internal ARPA Task Force, including members of REIB, CEDO, and the City’s COVID Response Leader to assist in reviewing potential projects and creating a public survey that will be translated into 8 languages, before hosting a town hall to provide the community with the chance to give additional input.
With all the work we have underway, Burlingtonians should feel confident that the City team is working hard to address urgent and emerging needs, and planning for a better and more sustainable future. If you have questions about any of these projects or proposals, I hope to hear from you at mayor@burlingtonvt.gov or at an upcoming coffee hour – every Wednesday at 8 am at the Bagel Café & Deli!
Warmly,
Miro
