South Burlington officials report $500,000 federal reimbursement on hold as paving contract awarded

City staff told the South Burlington City Council on March 17 that $500,000 in federal reimbursements for the Bike-Ped Bridge project is temporarily unavailable because the federal portal is closed, potentially leaving that amount in limbo in the short term.

City Manager Jesse Baker reported that the city has spent $2.6 million on the Bike-Ped Bridge to date and has received $1.6 million in federal reimbursements; about $470,000 of the spending is bond or city funding. “We have another half million dollars to draw down in the next quarter… the portal is currently closed,” Baker said, noting the $500,000 is therefore “in limbo.”

Separately, the council approved its consent agenda, which included awarding the South Burlington FY26 annual paving program contract to Pike Industries. Tom DiPietro, the city’s public works director, said the bid came in favorably and that staff will use change orders to add additional roads where feasible after locking in the base contract price.

Finance staff and councilors also discussed local-option-tax receipts (LOTT) and revenue projections. Martha (city finance staff) told the council that after two quarters of receipts it appears the city may receive slightly less than budgeted for FY25 and that projections for FY26 were built on recent performance. Council discussion noted macroeconomic headwinds and uncertainty in tourism-driven receipts that feed the local-option tax.

Councilors asked staff to monitor federal reimbursement portal status and to provide updated financial impacts if the portal remains closed. Staff did not identify any immediate interruption to ongoing construction projects, but said the timing of reimbursements will affect short-term cash management and bond-draw schedules.