Performing on the 38 Studios guarantee will cost nearly $100 million, a nontrivial amount in a state with just more than a million residents. Rhode Island lawmakers owe taxpayers an explanation of why the state issues moral-obligation bonds. If the answer is in order to preserve the option of default, they should provide guidance as to what kind of circumstances would lead the state to consider defaulting — and how that guidance relates to 38 Studios.

I guess it helps a little bit.

ologypolitics:

Game face, dude.

So, remember when it came out, as part of the airing of dirty laundry that accompanied the demise of 38 Studios, that Curt Schilling had chosen to use $4 million of Rhode Island’s $75 million loan to pay himself rather than make payroll? Seemed pretty selfish, right?

To be fair, they’re bill collectors—what do you expect them to say?

“Unpaid wage claims become a matter for the courts when a company declares bankruptcy or is placed into receivership.”

Perhaps the best path would be to take advantage of the fact that the 38 Studios bonds are moral-obligation bonds rather than general-obligation bonds, and simply default and refuse to pay. The big downside to defaulting is that it makes it much harder to borrow money in the future. But considering Rhode Island’s track record of debt-financed economic development schemes, that might be a blessing in disguise.

The Chafee administration wants to know whether Rhode Island taxpayers have legal avenues to claw back some of the tens of millions of dollars they’re poised to lose after the collapse of 38 Studios.

The governor’s office is close to choosing a law firm to examine whether Rhode Island can seek damages from the professional liability insurance policies of those who worked on the $75 million loan guarantee, a person familiar with the discussions told WPRI.com on Monday evening.