Citicapital, the financer of Burlington Telecom to whom the city owes more than $33.5 million, filed suit today in federal court seeking repossession of all equipment and millions of dollars in repayment and damages.
The city-owned provider of television, Internet and phone services has been in arrears for much of its existence, and also violated its state license by spending cash from general Burlington accounts to keep the utility afloat. Burlington Telecom has been unable to make payments to Citicapital, and the financing giant responded Friday by suing the city in federal court in Burlington.
In a brief statement, the city said it is "reviewing the complaint and will vigorously defend the City’s interests in court. Citicapital’s filing has no impact on Burlington Telecom’s provision of services to its business and residential customers."
In a brief statement, the city said it is "reviewing the complaint and will vigorously defend the City’s interests in court. Citicapital’s filing has no impact on Burlington Telecom’s provision of services to its business and residential customers."
We had indicated almost two years ago that this was to be the outcome, despite the remonstrances of several of those interested in its success. This is no surprise. We have seen the Government hand out almost $10 billion to companies with no track record in deploying fiber and operating systems of significant size. In fact as we observe the progression of some we see further internalization and less attempts to get the experience necessary for meeting the challenge. This we believe may very well mean a total loss of the $10 billion or so given away. It is a shame for RUS up to this point had a fine reputation. Alas it may be sullied.
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