38 Studios, a game developer founded by Curt Schilling, pitcher for the 2004 World Champion Boston Red Sox, is in dire straits. The company has to date received $50 million from the Rhode Island Economic Development Corporation (RIEDC), a governmental jobs-creation outfit that facilitates loans, essentially borrowing money with interest to pass on to companies for creating local jobs. 38 Studios is on the hook for a total of $75 million, with the addition of the interest on said money bringing the sum to about $113 million. Thus, should 38 Studios default on the loans, Rhode Island tax payers would be responsible for covering not only the principle, but the accrued interest as well.
And that is what is likely to occur, after Schilling’s company “hand-delivered” a check for its most recent amount due, $1.125 million, to the RIEDC, and subsequently asked them not to cash it as there were insufficient funds to cover it. On top of that, all temps and contractors were let go from the developer this week, and full-time employees are currently not being paid.
I think politicians need to understand that anyone can create jobs, but it takes a special person with a good business plan to create them for the long term. Clearly, Schilling was not that type of person.