Burlington Council Weighs Money Matters Ahead of Budget Vote

The Burlington Electric Department will increase rates by 4.5 percent this fall, the utility’s fifth rate hike in as many years.

City councilors unanimously approved the change on Monday. The bump will add about $3.80 to the average customer’s monthly utility bill, starting in September.

Burlington Electric general manager Darren Springer attributed the hike to the increasing cost of transmitting energy on the regional power grid — an expense the city can’t control.

City electric rates have increased steadily in recent years, starting with a 7.5 percent hike in 2021. Even so, the rates have grown at a slower pace than both housing and health care costs over the past decade and are still below the rate of inflation, city data show.

The item was just one of several money matters councilors discussed on Monday night. They also debated the coming year’s city budget and deliberated on various fees and taxes, all of which could make it costlier to live and do business in Vermont’s largest city.

Mayor Emma Mulvaney-Stanak’s proposed $106.6 million budget trims $1.9 million from the current year’s spending plan but will still result in a modest tax rate increase of 0.83 percent. Under the plan, the owner of a home valued at $500,000 would pay $35 more in municipal property taxes in fiscal year 2026. Education taxes, meantime, are projected to go down, meaning taxpayers could see an overall decrease on their tax bills, officials said.

The cuts have come at the expense of city programs and staff. Eighteen workers were laid off last month to close an $8 million budget gap created by a ballooning city government and shrinking revenues. Seven other vacant positions were eliminated. Balancing the budget will also require merging the city’s Community & Economic Development Office and its Business & Workforce Development department.

Councilors have to approve the budget before July 1, but they’ve already disagreed on some parts of the plan.

On Monday, councilors debated a proposal to keep in place a 2.5 percent gross receipts tax on alcohol and meals sales. An increase from the original 2 percent tax, the rate hike was meant to sunset after a year, but Mulvaney-Stanak says the city needs the extra revenue to balance the coming year’s budget.

Council Democrats, who have a majority, raised concerns that the surcharge would drive customers from downtown, which is already contending with a drug and homelessness crisis and a disruptive construction project on Main Street. They introduced a resolution that would give the city until late August to determine whether to continue the tax or let it lapse.

“The business community in the city is really hurting, and they have been coming to us begging for help,” Councilor Becca Brown McKnight (D-Ward 6) said. “Businesses are relying on the language, which is in our ordinance, which says this tax will be sunset.”

Progressives, meantime, argued that people don’t compare different towns’ gross receipts tax rates when deciding where to eat. If the rate is scaled back, the Progs said, the city would have to balance the budget either by raising taxes or finding other places to cut, to the tune of more than $700,000.

“I just fundamentally think that is a mistake,” Councilor Carter Neubieser (P-Ward 1). “The vast majority of folks have been clear with us that they want to do everything they can to limit increases to their property taxes. That’s across party lines.”

Progressives moved to amend the Dems’ resolution, adding language that would have kept the 2.5 percent tax in place. But the motion failed on a 6-6 tie vote, even with Democrat Evan Litwin (Ward 7) breaking with his party to support the Progs’ proposal.

After more debate, some Progs ended up reluctantly voting for the Dems’ resolution. It passed on a 9-3 vote.

Councilors were set to debate a proposal to increase impact fees — another of Mulvaney-Stanak’s ideas to raise revenues — but ended up postponing the discussion until their June 16 meeting. Assessed on new developments to offset their use of city services, the fees are adjusted annually but historically haven’t covered the cost of infrastructure projects they’re meant to fund. A new proposal would essentially double the fees on new housing, from about $3,000 per 1,000 square feet of new space to as much as $6,000 per unit.

Also on Monday, Mulvaney-Stanak announced that she had signed a resolution that aims to relocate a controversial free lunch program from a city parking garage.

The mayor has been working for months to find a new home for Food Not Cops, a mutual aid group that has served lunch in the Marketplace Garage every day since 2020. Last month, however, businesses circulated an open letter urging her to move faster.

In response, the council’s Democratic majority introduced a resolution that set a June 15 deadline to move the lunch. Progressives succeeded, with some Democratic support, to remove that deadline from the proposal. But the Dems then pushed through a last-minute change that directed Mulvaney-Stanak to come up with a long-term plan for the lunch by mid-July.

Last week, the mayor urged councilors to reconsider their resolution. Just before Monday’s meeting, however, Mulvaney-Stanak posted a letter online that changed course.

“I am signing this resolution to model compromise with Democratic City Councilors, but with great concern that working towards a bipartisan compromise was ultimately not offered back to me as Mayor,” she wrote.

The council debate devolved into “a political battle that serves no one and which perpetuates the notion that City government cannot come together to support people and places we all hold dear,” the letter continued. “Burlington needs us to do better going forward.”

Mulvaney-Stanak also pledged $10,000 to relocate the lunch to an as-yet-undetermined location. The council’s original resolution had offered $2,000 to help with the move.

Later in the meeting, councilors unanimously approved a slate of city department heads, including a few new faces.

Starting July 1, longtime firefighter Michael Curtin will assume the role of fire chief following the retirement of former chief Mike LaChance. The Church Street Marketplace will have new leadership in Samantha McGinnis, a six-year city employee who currently works for Business & Workforce Development. McGinnis will replace Kara Alnasrawi, who leads both of those departments but was promoted Monday to director of CEDO. Former CEDO director Brian Pine will lose his job as part of the department reshuffle.

Several other departments have interim leaders, including the police department; human resources; Racial Equity, Inclusion & Belonging; and Parks, Recreation & Waterfront. Mulvaney-Stanak hopes to fill most of the positions in the coming months.