NEW: Hinckley Rips 38 Studios Deal
Friday, June 08, 2012
Republican Senate Candidate Barry Hinckley joined the chorus of criticism being directed toward 38 Studios, which filed for bankruptcy Thursday.
As a result of the video game company's financial troubles, hundreds of employees have been laid off, and Rhode Island taxpayers are potentially exposed to obligations of over $100 million.
"As I have often said, this deal was a loser for Rhode Island from day one," Hinckley said. "Whether we're talking about Solyndra on the federal level, or 38 Studios right here in Rhode Island, this sort of cronyism has repeatedly blown up in taxpayers' faces. That being said, the focus of the Governor and the EDC at this point should be solely on how we limit the fallout from this latest disaster."
"The 38 Studios situation remains unclear on a number of fronts," Hinckley said. "How much taxpayer money is at stake, and where were funds raised from state-backed bond sales used? Does 38 Studios have a credible and sustainable pathway to fulfilling its obligations to it's bondholders, or is it time to salvage what we can by liquidating the company's collateral? Most importantly, how do we make sure that bond issues that never went to the voters for approval are never again treated as a taxpayer obligation? These are questions that can only be thoughtfully answered after a complete audit of 38 Studios, and its relationship with the Economic Development Corporation (EDC).”
