Vt. auditor finds 'consequential mistakes' in Burlington TIF accounting

MONTPELIER, Vt. (WCAX) – Vermont Auditor Doug Hoffer in a report Tuesday says the City of Burlington made “consequential mistakes” in managing its Downtown Tax Increment Financing district that was used to pay for St. Paul Street reconstruction and other major projects. Burlington Mayor Miro Weinberger immediately rejected the key findings of the report, calling them “bogus.”

The latest report comes on the heels of a report last January that found the city also made errors in managing the city’s Waterfront TIF district.

“While we were pleased to see that the City adopted some of our earlier recommendations to improve their financial management, the Downtown TIF audit shows once again that even Vermont’s largest municipality struggles with the complexity of the TIF program,” Hoffer said in a statement. “The audit found numerous consequential mistakes, and revealed interest payment levels that are considerably higher than what voters had been told to expect.”

Hoffer says the city received $4.6 million more from its bond issuances than the amount approved by the Vermont Economic Progress Council. In failing to request VEPC’s approval, he says the city bypassed a control on limiting increased costs of debt service being borne by the State Education Fund and that the diversion of additional tax increment to Burlington to cover the increased cost will be made up by taxpayers in non-TIF areas of the state.

In a statement, Mayor Weinberger said the city entirely rejects the auditor’s key findings. “The headline finding of this audit is bogus and reflects Auditor Doug Hoffer’s longstanding campaign against the State’s TIF program,” Mayor Weinberger said in a statement. “It’s reasonable for the Auditor to bring the legislature’s attention to the policy question of whether there is some public interest in establishing new guidelines for the use of TIF bond premiums. It’s completely unreasonable for the Auditor to suggest that Burlington has made a ‘misstep’ and exceeded an approved cap — especially after failing to note any prior concern about the City’s use of bond premiums last year when auditing Burlington’s Waterfront TIF district. That the Auditor published this opinion without even noting the bond counsel’s clear and detailed objections indicates that this report is more op-ed than audit.”