Curt Schilling's company seeks help

Updated: May 16, 2012, 2:41 PM ET
Associated Press

PROVIDENCE, R.I. -- Former Red Sox pitcher Curt Schilling asked Rhode Island for additional help to save his video game company Wednesday, prompting state leaders to consider whether the firm is viable enough to justify further investment.

Schilling, an ESPN baseball analyst, briefed Gov. Lincoln Chafee and the state's Economic Development Corp. board in a closed-door session.

Following the meeting, Chafee would not say what Schilling is seeking from the state. The governor said the question before state economic development officials was, "How do we avoid throwing good money after bad?"

Schilling declined to answer questions, saying only: "My priority right now is to get back to my team."

Concerns about 38 Studios' financial health arose when it failed to make a scheduled $1.1 million payment to the Economic Development Corp. on May 1.

The business was lured from Massachusetts in 2010 after Rhode Island offered a $75 million loan guarantee that state officials said would help bring hundreds of jobs and millions in tax revenue.

No action was taken on 38 Studios' new request. The board's next scheduled meeting is Monday.

Chafee, an independent, has vowed to do "everything possible" to assist the company, named after Schilling's number as a player, and prevent the state from having to pay the company's debts.

"The most important thing, going forward, is the viability of the company," Chafee said Tuesday. "We're looking at everything."

House Speaker Gordon Fox said he began hearing "inklings" about trouble at the company a few weeks ago, but still doesn't have the necessary information to gauge the company's health.

Under the terms of the loan guarantee agreement, 38 Studios promised to bring a total of 450 jobs to Rhode Island over three years. An outside monitor was to follow the company's progress.

The company released its much-anticipated first game, "Kingdoms of Amalur: Reckoning," to strong reviews in February.

Chafee and others criticized the loan guarantee at the time it was offered, saying it was putting taxpayer money at risk to help a company with no track record of success. During his run for governor, Chafee called it "one of the biggest risks I've ever seen."

Economic Development Corp. executive director Keith Stokes said at the time the board determined the loan agreement was a calculated risk well worth taking. Stokes said the board performed months of due diligence in analyzing the video game sector and 38 Studios and crafted a loan guarantee agreement that included strict performance benchmarks.

He said the agreement went "to great lengths to safeguard taxpayers and ensure economic performance."


Copyright 2012 by The Associated Press

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