[F]ormer trustees at Burlington College are expressing shock and disappointment that a fellow board member invested in a prime waterfront parcel the financially strapped college sold.
The New York Times reported Saturday that at least one former Burlington College trustee — Joel Miller — was part of the group that purchased the property the struggling school sold.
An $80 million condominium complex is now under construction at the site.
The disclosure came to light as part of a story about Jane Sanders’ time as president of Burlington College and whether the college’s closing would impact the presidential run of her husband, Sen. Bernie Sanders. During her time running the school, Burlington College purchased a piece of waterfront being sold by the Vermont Catholic Diocese to settle sex abuse claims. The land purchase, part of an ambitious expansion, and the debt were later blamed for the college’s demise.
The 2010 land deal also triggered a probe by the federal government into whether Jane Sanders had inflated pledges the college received as collateral for the loans. A spokesperson for Sanders said last year the investigation concluded with no charges being brought. Sanders was forced out in 2011, less than a year after the college purchased the land.
Miller confirmed to the Times that he was an investor in the group led by developer Eric Farrell that bought 27 acres from the college before it collapsed in 2016 and an additional six acres after it closed. Miller was a Burlington College trustee from 2003 to 2015.
The college had paid $10 million for the approximately 33 acres and borrowed $6.7 million from People’s Bank when it bought the land in 2010. The Catholic Diocese also provided a $3.6 million loan. The “crushing debt” caused by those loans and the failure to increase enrollment were blamed for the college’s demise.
“There were other board members that were investing,” Miller told the newspaper, but said he was “not at liberty” to say who those members were.
Yves Bradley, the former chair of the college’s board of trustees, told VTDigger that board members are “incredulous” that Miller had invested in the deal. He said Miller had not informed the other members about his investment.
“Whether it’s an investment opportunity or not, it doesn’t seem like it’s a wise thing to invest in a land deal that is going on with a college that is failing, that you are on a board of,” said Bradley, a commercial real estate agent.
Former trustee Jane Knodell said Miller’s decision to invest — which board members said they learned about from the news report — was not “appropriate and ethical.”
“It just has an appearance of profiting individually from very difficult circumstances facing an organization to which you have a fiduciary responsibility, and a responsibility to help that organization succeed,” Knodell said.
Miller did not return calls or emails from VTDigger requesting comment. No one answered the door during a visit Tuesday to his Burlington home.
Miller’s investment in the sale was mentioned briefly in the Times story published Saturday, headlined “Jane Sanders and the Messy Demise of a Vermont College.”
Knodell said she was unaware until then that Miller was an investor.
“I feel that he had an obligation to disclose his intentions with the rest of the board, and I as an individual board member would have requested his resignation from the board,” Knodell said.
Bradley said Miller should have discussed his plans to invest with the full board before making the investment, especially because of the scrutiny the college was under in its final days.
“It certainly can be perceived as a conflict of interest,” Bradley said. “Certainly at that time, if that had come out, that would have been extraordinarily damaging.”
Joel Miller, a retired psychologist, is the husband of former state senator Hinda Miller, a co-founder and past president of Jogbra, a women’s sports apparel company. Joel Miller owns at least five properties in the city, with a total value of at least $3.5 million, according to city property and state corporation records.
Farrell purchased the Burlington College property in separate sales over a several year period, and it’s unclear when Miller invested. Farrell is currently constructing Cambrian Rise, a massive, 700-unit $80 million housing development on the site.
In February 2015, Burlington College sold 27 acres to Farrell for $7.65 million to put it back on better financial footing. The college kept six acres, but was still unable to stay financially afloat. Farrell bought the rest of the property after the college closed in 2016.
Farrell would neither confirm nor deny that Miller was an investor in the project, or if there were any other members of the college’s board of trustees that invested.
“I’m not going to confirm whether that is actually a case in fact or not,” Farrell said. “But, you know, we live in a pretty small community.”
Farrell said the identity of the others investors was private and proprietary information.
He said he negotiated the sale with former Burlington College interim president Mike Smith and accountant David Coates, not the board of trustees itself. Smith could not be reached for comment.
“When I negotiated the purchase of that land from Burlington College, I did not have any involvement with the board, or the administration whatsoever,” Farrell said. “I would say, unequivocally, there was no conflict of interest.”
Bradley said the board did not ask Farrell who the other investors in the project were, as it was “none of our business.”
“For us, it was a business deal, and it was value for land,” he said. “We were in survival mode.”
Former college trustee Karen Paul said she had been unaware of Miller’s investment and did not know of any other board members who had invested.
She said Miller should have told the rest of his board about his investment as they considered the sale.
“If you have a financial interest in the purchase, you should disclose that,” said Paul.
Knodell said the implications of the investment were problematic as well.
“It kind of feeds into a narrative that there was an agenda all along to sell the land for the purpose of advancing development on the site, which is just not true,” Knodell said. “It is unfortunate in that regard.”
Former trustee Tom Torti said he was “shocked” to learn of Miller’s investment, but that knowledge of that investment would not have changed his assessment that Farrell’s proposal was, by far, the best option.
“I was surprised, a little chagrined that I didn’t know, but it wouldn’t have changed my view of the project,” Torti said.
Knodell, Paul, Bradley and Torti all said they were surprised to read that Miller said other board members had invested, as well.
“I’m shocked Joel invested without disclosing, and I would be shocked to hear other board members had invested without disclosing,” Torti said.
Farrell also declined to explain the details of the investments he offered into the project, or how many investors were involved.
“I entered into an agreement to buy a certain amount of land from the college and I formed an investment group to make that purchase, because we didn’t finance the purchase with a bank,” he said.
Bradley said there was “no way” that any other members of the board invested in the sale.
But he said before learning about Miller’s investment he would never have thought that any of the board members would have invested, so it was “possible” other board members were involved.
“Honestly, anything’s possible, maybe someone else did,” he said. “I mean, I doubt it.”
Farrell emphasized that he believed the sale of the land was not improper in any sense.
“Throughout that entire process, I would tell you, unequivocally, there were no shenanigans whatsoever,” he said. “It was all aboveboard straightforward.”
