House committee to begin 38 Studios hearings

A Rhode Island House committee will open hearings Wednesday afternoon into the state’s $75 million loan guarantee to 38 Studios, WPRO reported. More

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38 Studios

House committee to begin 38 Studios hearings

COURTESY WIKIPEDIA/CHENSIYUAN
THE RHODE ISLAND HOUSE OVERSIGHT COMMITTEE will take on the state's multimillion-dollar loan guarantee to the now bankrupt 38 Studios in hearings to start Wednesday.
Posted 8/7/13

PROVIDENCE – A Rhode Island House committee will open hearings Wednesday afternoon into the state’s $75 million loan guarantee to 38 Studios, WPRO reported.

The House Oversight Committee will begin its review of about 8,000 pages of documents surrounding the loan guarantee in today’s hearing, chairman Rep. Michael Marcello told WPRO.

Marcello said eventually the committee will want to hear testimony from key players in the R.I. Economic Development Corporation’s deal with 38 Studios, which went bankrupt last year. However, many are currently involved in civil lawsuits.

“We're more focused on their due diligence and what was in place, and what they did. And, until that suit gets going, we’re having a very hard time getting people to testify,” said Marcello.

The state has begun to budget money to repay the bonds that funded the loan guarantee through the EDC, an issue of often contentious debate over whether the state should repay or default on those bonds. Marcello told WPRO that question will not be at the heart of the oversight committee hearings.

“It wouldn’t be my intention. The focus of the hearings is not whether the bonds should or should not be repaid, at least from my perspective or the majority of the House. They have to be repaid for a variety of reasons including the long-term credit of the state,” Marcello said.

The hearing is set to begin at 4:00 p.m. Wednesday.

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