State Rep.: Fellow lawmakers 'bamboozled' over 38 Studios deal

A Republican lawmaker said he and fellow lawmakers were bamboozled when the state’s Economic Development Corporation gave a $75 million loan guarantee to Curt Schilling’s video game company.

State Rep. Laurence Ehrhardt, who is a member of the House Finance Committee, said very few members knew of the deal between the state and 38 Studios.

“I sit on the finance committee and I know most of my colleagues on the finance committee claim they didn’t have any such knowledge,” he said.

Ehrhardt said there’s no question that the deal was rammed through.

The North Kingstown lawmaker has introduced legislation that would prevent the EDC from giving out loan guarantees like the package approved to 38 Studios. Ehrhardt’s bill would limit the guarantees to $10 million to any one entity.

Schilling’s company was lured from Massachusetts in 2010 after Rhode Island offered the $75 million guarantee that state officials would help bring hundreds of jobs and millions in tax revenue.

The financial situation at 38 Studios remains unclear.

The company earlier failed to meet a May 1 deadline on a $1.1 million payment to the state.

Ehrhardt said any future deals should require more reporting back to the state.

“There’s no outside reporting on this. There’s no financial statements made public. What I am very concerned about though is that we’re hearing stories that the auditors had issued a bad opinion back in June, and yet EDC continued to advance the funds. So either somebody wasn’t getting the reports or didn’t understand them or was asleep at the switch, that’s the real question we have to ask,” Ehrhardt said.

Article source: http://www2.turnto10.com/news/2012/may/17/state-rep-fellow-lawmakers-bamboozled-over-38-stud-ar-1040452/

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