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EDC Official Resigns; 38 Studios Staff Laid Off

Helena B. Foulkes is the second state official to resign in the last week amidst the 38 Studios controversy.


Economic Development Corporation Vice Chairwoman Helena B. Foulkes has resigned, reports the Providence Journal, the second state official to resign amidst the controversy surrounding 38 Studios, which reportedly has laid off its staff.

"I have discussed with the governor his plans for the Board at the EDC, and I think it is best at this time I resign. I wish him good luck in this very difficult challenge," Foulkes said.

Gov. Lincoln Chafee appointed Foulkes to the EDC last year.

Foulkes' resignation comes after in the wake of the controversy surrounding Curt Shilling's video game company.

The company, headed by the former Red Sox pitcher, defaulted on a $1.125-million payment to the state on May 1, and faces financial turmoil after sales of its first game, "Copernicus," failed to meet expectations. Chafee criticized Schilling publicly last week, saying the company had been "stonewalling" the state. 38 Studios has reportedly laid off its entire staff, which numbers around 400, most of which were in Rhode Island.

In 2010, EDC approved a $75-million guaranteed loan to the videogame company following 38 Studios’ promise to bring 450 jobs to the state by the end of 2012 and moved its business from Massachusetts to Providence.

Amidst the 38 Studios dilemma, State Rep. Lawrence Ehrhardt (R – North Kingstown) introduced legislation to the General Assembly Wednesday that would prohibit the EDC from providing loan guarantees of more than $10 million to any one entity – a measure Ehrhardt attempted to submit two years prior. According to the Journal, Ehrhardt said he was dissuaded from proposing the cap at that time by Stokes who told him it would “upset a transaction” that the EDC was working on.

“I feel that I was substantially betrayed,” Ehrhardt told the Journal.

NKGOP Watch May 25, 2012 at 12:07 AM
"Ehrhardt said he was dissuaded from proposing the cap at that time by Stokes who told him it would “upset a transaction” that the EDC was working on." EHRHARDT IS SUCH A SCAB, AND WEAK TOO! AS TO BE DISSUADED SO EASILY, NOW WANTS TO BE THE HERO? WOW. RESIGN NOW MR EHRHARDT!
Govstench May 25, 2012 at 12:23 PM
This board has been getting involved in some high risk ventures in the past. This 38 studios deal was never properly monitored and screams of where this board has been. This agency needs to be investigated to see how much bond money has been granted, if the proper oversight of these "projects" is being done and is this board communicating with the leaders of government. These fiefdoms tend to go off on tangents and there is another situation developing that will have an impact on the East Bay if it is allowed to go forward.
Peter May 25, 2012 at 12:31 PM
How many legitimate small businesses in RI could have been helped with this $75 million, instead of dumping it in the lap of this self-aggrandizing, egomaniacal hypocrite? The collateral damage caused by the EDC is almost incalculable. Our economy is already one of the weakest in the country; we didn't need a quasi-governmental agency to make it worse.
ru4real May 25, 2012 at 09:47 PM
"I feel I was substantially betrayed" so states Rep Ehrhardt. BULL!!! He caved to Stokes and that is the heart of the matter! The rep is making an attempt to pull his own burning bacon out of the fire and the public isn't buying it! This is another example of our elected officials choosing their points of entry when they think it is most helpful to themselves. If he was initially not in favor of the magnitude of the deal then he should have held his ground on behalf of the taxpayers--he did not!! Instead he withdrew his legislation and helped to pave the highway to the 38 Studios debacle. ALL the taxpayers of RI will pay for this debacle for many years to come--THANK YOU VERY MUCH!
seed and soil May 26, 2012 at 01:39 AM
Another disgrace for the state. Unforgivable from start to finish. Reportedly $102 million of taxpayer money used as venture capital where no investors dared tread. We all saw this disaster coming. No surprises here.
NKGOP Watch May 30, 2012 at 05:26 PM
These arrogant "EDC" appointed HACKS think they know it all. Looking at the result, AND the lack of due diligence AND lack of oversight... Guess not! Just errand boys and errand girls for the pols. Sad. I couldnt bring myself to look in the mirror. This ill-conceived stupidity has hurt so many people and helped no one.
Govstench May 31, 2012 at 11:22 AM
The list of directors resigning continues to grow, but old Georgie Nee is still hanging on, he won't go.
Concerned Resident May 31, 2012 at 02:11 PM
Guessing it's difficult to reason in one area when it is lacking in other aspects especially when he feels he is among the chosen few as a king with RI being his disciples.

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