EDC Head Resigns, Ehrhardt Calls For Loan Caps Following 38 Studios Controversy

The head of the state's Economic Development Corporation has stepped down following the controversy of Curt Schilling's 38 Studios.

Keith Stokes has stepped down as the head of the Rhode Island Economic Development Corporation amid the controversy surrounding Curt Schilling’s videogame company 38 Studios, according to the Providence Journal.

The company, headed by the former Red Sox pitcher, defaulted on a $1.125-million payment to the state on May 1. On Wednesday, Schilling and members of 38 Studios met with state and EDC officials in an emergency meeting that was closed to the public. 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.

Stokes, a longtime board member of the EDC, was appointed by former Gov. Donald Carcieri in January 2010 and reappointed by Gov. Lincoln Chafee when he took office the following year.

"As a lifelong Rhode Islander, I am grateful for the opportunity to have served at the RIEDC," said Stokes.  "I have dedicated my entire career to a state I love very much with the desire to create a better place for Rhode Islanders to succeed and to raise their families. I will continue to be involved in the future."

A Newport native, Stokes said he plans to spend time with his family for now. 

"I thank Keith for his service to Rhode Island, not only at the helm of the EDC, but also as a former Board member of that agency and as the long-time Executive Director of the Newport County Chamber of Commerce," said Chafee in an official statement issued Thursday morning.

The Providence Journal also reports that has asked Colin P. Kane – head of the Route 195 Redevelopment District Commission – to replace Stokes.

Amidst the 38 Studios dilemma, State Rep. Laurence 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.

Govstench May 18, 2012 at 03:02 AM
The RIEDC should be shut down and investigated. No more dough until everything is vetted out.
NKGOP Watch May 18, 2012 at 05:41 AM
EHRHARDT was betrayed? I cannot believe the GALL of that NKGOP scumbag! During the halley controversy he told a leading state reformer he 'had no knowlege' of the NK School corruption issue. In FACT there were over TWO HUNDRED emails directed to Ehrhardt, not to mention phone calls asking for his assistance. HE LIED. Now he wants to look the good guy? Incredible. The NKGOP is a CANCER.
NKGOP Watch May 18, 2012 at 05:44 AM
Damn straight Gov!
Paul Marshall May 18, 2012 at 01:51 PM
@NK: "scumbag" ?? HOW eloquent! 70 years of democRAT rule and this is what we have to show for it: over 1/2 the state bankrupt. 36% un/underemployed. $4 gasoline. $8 bridge tolls. 1/3 home value gone. Bloated/wastefull government. Invisible/Inept Congressional Delegation. Hazardous roads and bridges. Skyrocketing crime. Shattered families. We're a small state with a big tin cup we rattle in Washington every year! ()What makes us so special that the rest of the country has to pay 1/3 of our state budget every year???? Watch out when they finally wake up!! .....A real genius for governor elected by kind folks like you (by default).. An endless stream of "demo-bots" being investigated and incarcerated. Non-stop corruption - fraud - waste perpetrated on the NEXT generations. Yes, You make my case very well. Thank you.
Noreswindnk May 18, 2012 at 04:09 PM
Our thanks Larry. Somebody had/has to change the rules as they are, while apparently some others just want to blog their political annoyance and venom. For one, I don't really care if you're a D, I, or R, just do what's right for P-E-O-P-L-E. This wasn't, and Rep. Ehrhardt is trying to fix it. Why is it so hard just to say.........thanks.
NKGOP Watch May 18, 2012 at 04:43 PM
Based upon my experience with this public representative, he CANNOT BE TRUSTED. It's that simple. IF you feel these type of people are your only refuge from Democrats, you are FOOLS since the 38 Studios debacle was a CARCIERI DEAL THROUGH AND THROUGH, as was DEEPWATER WIND. And you think that performance would be an IMPROVEMENT? You're KIDDING, right? - Now, if 'Govstench' on here wanted to run as a republican, I could support that. I support Brendon Doherty hands down of either Cicciline or Gemma. I think Doreen Costa has PROVEN herself to be fair and genuine, whether you agree with all her positions or not. You're damn right it's not necessarily a D or an R it's about character. And Ehrhardt's character is that of an elitist facade in front of a cheap liar. Maybe you will get lucky, and his position will align with yours on dismembering EDC which I agree with, but DO NOT TRUST EHRHARDT, HE LIES.
ru4real May 18, 2012 at 10:09 PM
This deal simply shows the inepitude of RI officials when diving in deep waters. The details of the deal painfully expose the lack of indepth financial understanding by our officials. Who goes to a lending institution and receives any financing without obligating any of their own personal wealth, known as collateral. No skin in the game for the borrower translates to stupid for the lender. Any high risk start-up, especially in the tech gaming industry, should be scrutinized to the max. We should change the state name from the Ocean State to the Sucker State, we're RI we never saw a scam we didn't like. @Nor--it's fine to want to close the barn doors after the horse has escaped, but where was his expertise when the deal was being hatched. He dived to Stokes and that's the real heart of the matter. That cocktail party where Schilling and Carcieri got the ball rolling for this debacle must have been a hum-dinger. Can't wait for the next chapter of Who Will Burn Ri Next.
Dave May 19, 2012 at 10:49 AM
ru and nkgop watch have it right here. Where was Erhardt when the deal was hatched? Mr Marshall, don't you understand, it doesn't matter if the person has a D or an R next to their name if the taxpayer is getting screwed?? And screwing the taxpayer sure isn't solely the perogative of the Dems, especially in NK, where the NKGOP has had the leadership for a decade. Don't let rote party affiliation blind you to what's going on, save your loyalty for the citizens and taxpayers.
Paul Marshall May 19, 2012 at 05:25 PM
Carcieri can speak for himself. Let's face it, the vote in the House was 66-6. ALL democRATS voted FOR this. Party affiliation matters. Life is a team effort. It takes a TEAM to accomplish (or in our case here in R.I. destroy) a state. Granted, the risk v. reward was dubious at best in this partyicular case, BUT the democRATS are systematically destroying this place. It's hard to miss. No jobs. Crumbling infrastructure. Special interest legislation like the SNOWBIRDS getting preferential treatment. Kids leaving never to return. Credit the democRATS for this. Credit them and be honest about it. Credit them.
Concerned Resident May 19, 2012 at 05:54 PM
Any and all only have to watch TV, listen to the radio and or read the paper to see that Paul M is accurate in his assessment of RI government. Unfortunately the chosen few prefer to ignore the facts via burying their head in the sand for self promotion.
Dark star May 19, 2012 at 06:38 PM
That's right Paul Marshall, Watch, Dave and all the other default republican bashers are desperately pointing fingers at republicans to divert the attention from the truly guilty...the democrat controlled house and senate. They all know that the gov, whoever it is, cannot get anything done without the house and senate approval and in this case, all the dems, and most of the 12 or 13 republicans were all googily- eyed and eagerly passed it. If Gov Gump was in question of it, why didn't he audit the deal when he took office? He is the defacto chairman of the EDC and has the right and responsibility to do so. Carcieri may have set the wheels in motion, but the RI dems are the ones to blame and nobody else.
Common Sense May 20, 2012 at 01:03 AM
Cr & PM where are the R's when we need them? You know the ones; fiscally conservative, back business and small government with no social programs. Where are they in R.I.? Why don't they run? When they do why don't they win? Where is their support? If you don't like what the D's are doing you R's should be running! I don't think that the D's can be blamed if the R's don't run. So you R's out there that want to blame the D's for R. I.'s problems remember that you could run or just sit there and complain. There are some bad D's for sure but the people in their district voted them in and maybe they were the only choice or the best of the candidates to vote for. The system is what it is. Get the R's to put up better candidates and then support them. I have voted for both R's & D's trying to support the best person available and I don't have a bad name to call either PM. Blind support is not loyalty to a party, it is stupid. Support the best person and maybe we will all benefit.
ru4real May 20, 2012 at 02:02 AM
PM & CR are Patch hacks for the NKGOP. Reality is as I stated before Erhardt is a johnny come lately trying to cleanse his record on this issue. It doesn't play in the arena of reality, the record speaks for itself. That doesn't mean that dems are excused. @Dave-you are correct-the party doesn't matter-they are all the same screwing the taxpayer and then after the fact trying to white wash their dirty laundry. The only way this state may ever begin to get back on track is if the taxpayers clean house and vote for people who are truly party independent. In other words people who have the taxpayers in the number one position and no party IOU's! Sorry I lost my mind for a moment and forgot that this is RI--good government is not something that the people of RI have ever wanted or probably ever will! Instead of power to the people it's power to the black hole of oblivion-better known as RI!
NKGOP Watch May 20, 2012 at 05:58 AM
Tired is a hack looking to bash ME on here and misrepresent me. To correct him/her, I recently praised numerous republicans and my desire is in no way to excuse bad state government by the Dem majority. This is a LOCAL patch, so of course I try to bring people's attention to the NKGOP which LOCALLY has proven a corrupt, even rancid, influence for the worse in North Kingstown since the "young turks" took over in the early 90's... when they gave us HALLEY and a hundred other bad things. The NKGOP record is indisputable. Regarding the school corruption it was NKDEM candidates who finally cleaned it all up after may years of NKGOP people getting on the school board and rubber stamping dear leader, even renewing his three-year contract each year. Those are the FACTS. he was eminently corrupt and harmful, and it was NKGOP officeholders who kept that crazy train all going. When the Dems got elected to school board majority it was "morning in North Kingstown" again. So, we owe the DEMS a debt of gratitude for purging most of the evil from our school administration as soon as they got in place to do so.
Concerned Resident May 20, 2012 at 11:43 AM
Appreciate your comments and it's affect Tired!
Dave May 20, 2012 at 11:51 AM
Mr Marshall, I wasn't talking about the state level. I don't support the D's at the state level. I agree that they are destroying the state. That's not what we are talking about. We are talking about NK. I don't support many R's in NK because of their track record. I don't consider them conservatives. To me, they're no different than the state level D's! Your post, and those of your allies on here, illustrate the definition of people who can't think for themselves and are paralyzed by party affiliation. I'm a conservative who is for the country. I am adult enough to realize that both parties are invovled in corruption, and I don't like what I have seen from the NKGOP in the past 10 years.
Concerned Resident May 20, 2012 at 12:15 PM
@ Dave: although anything but perfect, I'm curious as to what you don't like aout NKGOP?
NKGOP Watch May 20, 2012 at 01:57 PM
Maybe it's that the NKGOP are basically scumbags? They have HALLEY and they appoint Harriet Powell after THIS came out: http://youtu.be/rLK2mhJQ7Zo They endorsed Halley to run, and they made him an officer in the nk republicans They made the residential wind turbine happen This lady took her special country club school tuition for her kid, voted to pay Halley the buyout http://youtu.be/7FktNj3C0Vc I could go on, and on and on....
ru4real May 20, 2012 at 02:45 PM
The videos speak for themselves. The truth always hurts especially when it has been preserved for everyone to see over and over. @Dave--I could not agree more with your 5/20 comments. Unfortunately party blindness afflicts way too many in this state Dem or Rep. It will never change because the people of RI do not want it to change. Too many on the free handouts and insider deals that the rest of us who are still working have to pay for. When the core (the voters) do not demand honest government you have what RI is, a rotten apple. Anybody got a good idea for a new computer game? Or want to retire on disability and receive a 6% compounded cola--see the latest Tim White story about Providence. 16 retired disability pensions=1.3 million dollars! Latest cd rates I have seen are about 1.5% for 5 years (Projo 5/20)--the rate of return looks a little out of whack to me but I could be missing something in the fine print. And the beat goes on!!!!! RI a state where no scam is unwelcome!!!!!
Govstench May 21, 2012 at 12:07 PM
Dave - Ehrhardt was ticked off at the way the Deep Water process was bypassing the PUC oversight - he fought against that bill. That will be another major disaster facing this state once that gets going. Why would anyone go along with a generator that will charge close to 30 cents a kwh? The existing rate now is only 12.5 cents. Ehrhardt also straightened out the net-metering game that was being played out by the developer in NK with the Stamp Farm mess. He filed bills that became law last year. Do the research - he was there.
Paul Marshall May 21, 2012 at 12:26 PM
@Common Sense: If you are a REPUBLICAN IN RI and run for office you get enormous abuse freom liberals like NKGOP. Guys like him do NOT stop at smears like you see here. Guys and women like him regularly key our cars, egg our houses, steal our signs, lie cheat and threaten. Don't take my word for it. Ask ANY incumbent or candidate. The police and A.G.'s office calls this "Campaign Hijinks". It's intimidation. It's WRONG. But "nice folks" like NKGOP here (who hide behind phoney names) think it's fun. And a good way to help their friends....but, is it? The unions put these simple-minded thugs up to this behavior. (Do you really think they have a half a brain?) In the "UNION STEWARDS PRAYER" they acknowledge and encourage supporters to be "Threatening". Threatening. How about that? I thought the liberals said that was unacceptable. Bullying by anyone for any purpose is wrong. But, this is why our state is so screwed. Guys like NKG abuse us and get away with it.
NKGOP Watch May 21, 2012 at 02:26 PM
I'm not a liberal, nor would I ever deface property or steal signs. I support good candidates of both parties. Using a nom de plume here is more common than a real name, and there are good reasons for it for some people. It seems Paul Marshall is a nut, losing it.
ru4real May 21, 2012 at 10:35 PM
You have made it a habit to call democrats--democRATS. I think maybe your protestations are a little about the pot calling the kettle black. I do not think calling someone a scumbag is acceptable either. It would really be refreshing to see the hack attacks and the whining stop. How about a novel approach--civil discussions of differences--hopefully leading to some progress for the good of RI. THAT WILL NEVER HAPPENED IN RI because the ideology of each party (blinders) is more important than progress. There is plenty of blame to pass around to both parties. Don't make the mistake of calling me on this, because the list is very long for both the Democrats and Republicans. (Need I say 38 Studios for openers) But ultimately the blame lies at the feet of the voters and residents of RI. As long as mediocrity is tolerated nothing will improve in RI. Both parties stock and trade is to white wash the dirty laundry and spin the obvious. The tortuous contortions and misrepresentations by both parties have strangled RI. However there is a positive side to all the political venom--Dunkin Donuts sells a lot of coffee! Maybe DD could install computer terminals where everyone could play the latest video game financed by the state.
CBA May 22, 2012 at 11:52 AM
Mr. Marshall: Your time (and posting space) might be better spent discussing issues instead of beating the "People Don't Use Their Real Names on This Site" horse to death. Welcome to the Internet: unless your are on Facebook, posters use a username/handle of their choice.
Kerri Hicks May 22, 2012 at 06:58 PM
I don't really mind which party you choose to affiliate with, because this is a house of cards no matter which side you're on. Really what I don't get is this. If you're Curt Schilling (pretty well-known guy, right?), and you've got a board like he's got for 38 Studios (some heavy hitters in finance and tech), and with all that you're still having such a hard time raising capital that you instead choose to ask the government for a loan, doesn't that say something about your business' prospects? Professional investors in the tech sector, venture capitalists, and angel funders weren't investing in Schilling's company -- if it were a good investment, don't you think they'd be beating down the doors? Did the RI EDC think they knew more than the VCs?


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