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Governor Carcieri Statement on Caprio Move to Interfere with 38 Studios Deal

Governor Donald L. Carcieri today issued the following statement in response to an attempt by Mr. Caprio, candidate for Governor, to interfere with the state’s $75 million loan guaranty agreement with 38 Studios, an interactive gaming company that has agreed to relocate its headquarters to Rhode Island and expand its workforce to 450 employees.

“Businesses and the bond market should not be subject to political posturing. The attitudes and positions taken by Mr. Caprio and Mr. Chafee serve only to undermine the positive economic development steps the state has taken in recent years.

The General Assembly overwhelmingly supported the Job Creation Guaranty Act, passing unanimously in the Senate, and 66 – 1 in the House. The concept of a Jobs Guaranty Program was something the EDC had long supported as a complement to the Industrial Recreational Building Authority (IRBA). While IRBA provides loan guarantees for bricks and mortar investment, the Job Creation Guaranty Program provides loan guarantees for intellectual property-based investments, including the interactive video gaming industry.

Further, the RI EDC Board, after months of due diligence, voted nearly unanimously to move forward with the 38 Studios deal.

It is a gross overstatement to imply that the Job Creation Guaranty Act reflects poorly on the state’s financial management or could have an adverse impact on the state’s bond rating. The fact is that a loan guarantee bond of this size or type has no impact on the state’s general obligation or its bond rating.

The EDC has entered into a good faith agreement with 38 Studios, after months of due diligence and analysis.

We have taken a number of very important steps to improve our business climate in Rhode Island, from tax reform and regulatory reform, to creating economic incentive and loan guarantee programs to assist our existing business community and attract much needed new businesses and jobs to Rhode Island.”

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