Richard Monroe, 24, carried out the "execution-style killing" of Kevin DeOliveira, 23, over a cocaine debt, federal prosecutors said in a prepared statement.
Agents from the Bureau of Alcohol, Tobacco, Firearms and Explosives arrested Monroe in Western Texas on Monday. He was scheduled to appear in federal court in El Paso, Texas, on Monday and could be transported to Vermont soon, prosecutors said.
Friends found DeOliveira dead of a gunshot wound to the head in his Greene Street apartment in January 2015. He was a New Jersey native and former University of Vermont student.
Monroe, according to prosecutors, discussed the murder with an unnamed witness. Investigators have recovered the murder weapon.
Monroe has also been charged with conspiring with another man, Zachary Hust, to sell at least 500 grams of cocaine in Vermont in late 2014. Hust is charged only with cocaine conspiracy, authorities said.
Before the murder, Monroe allegedly robbed two people at gunpoint in Burlington for small amounts of marijuana and cash, federal authorities said. He faces charges for that incident, too.