ECONOMIC DEVELOPMENT

Kane turns down EDC job

PBN PHOTO/BRIAN MCDONALD
COLIN P. Kane, head of the I-195 Redevelopment Commission, has turned down Gov. Lincoln D. Chafee's offer to succeed Keith W. Stokes as head of the R.I. Economic Development Corporation.
Posted 5/18/12

PROVIDENCE – Colin P. Kane, head of the I-195 Redevelopment Commission, has turned down Gov. Lincoln D. Chafee’s offer to head the R.I. Economic Development Corporation.

Kane on Friday told Providence Business News that he could not agree with the administration regarding compensation and that the position would be too much of a pay cut.

Chafee spokeswoman Christine Hunsinger said that Kane was "one of many" people the governor was considering to lead the EDC since Keith W. Stokes’ resignation late Wednesday amid fallout from the state’s $75 million loan guarantee to video game maker 38 Studios LLC.

Keith W. Stokes, who took over the EDC in March 2010, called the decision to step down a “mutual” agreement reached with Chafee after the EDC board held lengthy discussions Wednesday over how to respond to 38 Studios default on a $1.125 million fee payment.

“I brought the organization as far as I could and it is in a very good place,” Stokes told PBN.

He added a desire to reconnect with his family after 16 years on the EDC board. “Change sometimes comes from bringing in new perspectives.”

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Small Business

Colin is too savvy to get caught in this maelstorm. The State needs to look outaide of RI, find a first class, high power economic development person with a proven track record, and make them an offer with a long-term contract. There is NOBODY in RI that can turn this state around economically.

Friday, May 18, 2012 | Report this
richard@langseth.com

Since Colin Kane is EDC's landlord he could not possibly take on the executive directorship of EDC.

The next big problem that EDC will face is the underwriting of the $40 million bond offering to bail out the Department of Transportation via the I-195 Redevelopment organization. This I-195 organization has been folded into the EDC. Colin Kane is the chair of that organization.

This is what is known as the Knowledge District project. The mystery for the bond underwriters will be how these bonds are to be serviced and paid off.

After that the EDC will be faced with the challenge to obtain about $60 million for required Rhode Island Airport safety and pollution improvements. The airport does not have a new revenue stream to use to float these bonds.

Given all of this, the idea of using tax credits to bail out 38 Studios seems to be incredibly risky. Has everybody forgotten the historic tax credit fiasco? Here the state had to float a bond to finance the government for the revenue lost when the historic tax credits came into the Department of Revenue kicking the state budget out of wack. What state agency is going to get it in the neck when the 38 Studios tax credits pop up?

Tax credits are not free. They are simply a way to pay cash to developers and media producers (movies, video games, etc.) through the back door. We should shutter 38 Studios now and pay off our moral obligations.

Friday, May 18, 2012 | Report this
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