Push begins for Burlington bike path tax, bonds for fiscal stability and TIF

Church Street, Burlington. Photo by Greg Guma

With a month to go before the Nov. 6 elections, Burlington’s administration has launched a drive for voter approval of three ballot items at the heart of its agenda. In an open letter released and published locally Friday, Mayor Miro Weinberger argues that the proposals will stabilize city finances, make possible the next stage of waterfront improvements, and earmark funds for “ongoing, responsible upkeep on our bike path.”

“We can’t afford not to do this,” warned Mike Kanarick, assistant to the mayor, during a neighborhood presentation Thursday night with Chief Administration Officer Paul Sisson. Referring specifically to a $9 million “fiscal stability bond” designed to reduce Burlington’s
reliance on short-term debt, Kanarick stressed the need to respond to a recent three-step downgrade in Burlington’s credit rating.

Sisson anticipated concerns about how the money will be used. “This is not a Burlington Telecom bailout” or a way to fund ongoing operations, he said. The goal is to reduce Burlington’s reliance on tax anticipation notes, which affect the city like credit card debt, he
explained.

Although passage of the bond does not guarantee improvement in Burlington’s credit rating, Sisson believes that Moody’s analysts will view it as a “credit positive.”

Financial bonds items on the ballot must get two-thirds majority to pass.

Weinberger describes bonding authority as the preferable way to “start digging our way out of the hole caused by the mistakes on the past before they cause even more damage.”

John Ewing and Chip Hart Sr. are heading up the Partnership for Burlington’s Future Committee, which will advocate for all three items.

At the Ward 6 neighborhood planning assembly, Kanarick and Sisson were joined on a panel to explain the issues by University of Vermont economics professor Stephanie Seguino. She called the fiscal stability bond an intelligent response to a “reputational issue” for the city, one that could affect its future ability to borrow money.

Sisson acknowledged that the bond will not deal with the city’s large pension fund liability, estimated to cost Burlington more than $4 million a year. But he assured residents that Weinberger “intends to get on that situation,” as well as dealing with an upcoming round of contract negotiations with unions, beginning with those representing public works employees and the police.

Sisson, Kanarick and the mayor argue that if the fiscal stability bond doesn’t pass, the only choices available to the city are significant tax increases and municipal service cuts. This would prolong exposure to financial risk and have a larger impact on both taxes and services, the administration says.

The first point usually mentioned about the second ballot item – to authorize $6 million in bonds for the Waterfront Tax Incremental Financing (TIF) district – is that it will not increase anyone’s property tax bill. As Weinberger explains, TIF investments are expected to be “repaid by the revenues of the Waterfront TIF District.”

The Burlington Waterfront. Photo by Greg Guma

The funds will be used for a variety of projects – removing contamination around the Moran plant, stormwater improvements, waterfront parking, extending Lake Street, and replacing the skate park. Money is also earmarked to rebuild and improve the heavily used portion of the bike path from Perkins Pier to the end of the Urban Reserve.

Some biking enthusiasts hoped for a larger commitment. But Bike Path Task Force Chairman John Bossange told the Ward 6 neighborhood planning assembly that the task force was willing “to put some things aside.” Kanarick added a promise to “get it all done in stages.”

As with the fiscal stability bond, time is also a factor for TIF. Weinberger notes that “if we do not fully invest these TIF funds by the end of 2014 we could end up returning millions of dollars to the state instead of investing them in job-creating public infrastructure.”

The third piece of Burlington’s November financial package is a dedicated half cent tax for maintenance and improvement of the bike path. This is intended to work like the Penny for Parks tax passed in 2008. It would create about $180,000 a year in revenues. In the first years, some funds would also be used for “designing and permitting the modern bike path envisioned by the Pike Path Task Force,” Weinberger says.

One question the three ballot items will not resolve is the future of the Moran Generating Station. In June, Weinberger dropped a plan for the city to act as developer of the former coal plant as a recreational space with ice climbing, a sailing center, a restaurant and other facilities. Instead, he announced a request for proposals (RFP) process for private redevelopment of the site.

The competition was scheduled to begin in September. According to Ward 6 Councilor Karen Paul, guidelines for proposal submissions should be complete a few weeks late, possibly in time for an initial review by the Parks, Arts and Culture Committee on Oct. 22. Once approved, the RFP will be distributed nationwide. The hope is to present a new project by next April.

Weinberger thinks that an “environmentally clean site,” a plan for the area surrounding the building, and TIF funds for improvement of adjacent areas will attract a developer with a viable idea for the structure itself or the waterfront property on which it sits.

Burlington’s November ballot will also feature a non-binding advisory vote on legalization of cannabis and hemp, and a special election to replace Ward 1 Councilor Ed Adrian. The candidates to succeed him are Democrat Kevin Worden and Progressive Alison Segar.