PROVIDENCE, R.I. (AP) — Rhode Island Gov. Lincoln Chafee said yesterday that layoffs at Curt Schilling's video game company are another "terrible" indicator of 38 Studios' troubled finances.
"The shakiness of this company is a tragedy for Rhode Island," he told reporters during a briefing on efforts to help 38 Studios and prevent the state from having to pay its debts.
38 Studios was lured to Rhode Island from Massachusetts in 2010 after receiving a $75 million loan guarantee from the state. Chafee opposed the loan guarantee during his campaign for governor.
The company was more than two weeks late on a $1.1 million payment to the Economic Development Corp. State officials said last week they had been told by the company that it wouldn't be able to make its payroll.
Chafee said he continues to work to help the company stay afloat but opposes giving it any additional taxpayer support. He said 38 Studios has not provided information he's requested on the company's health, but he knows they have laid off employees.
"It's very, very frustrating," Chafee said of his communications with the company. "We're their biggest investor. If there's anybody they would want to work with I would think it would us, the taxpayer."
Calls to Schilling were not immediately returned.
The company released its much-anticipated first game, "Kingdoms of Amalur: Reckoning," to strong reviews in February. But Chafee said the state has consulted industry analysts who say the game was a commercial failure.
"As one of the experts said, 'This is an industry that punishes people that don't know what they're doing,"' Chafee said.
Questions about the state's oversight of the company are becoming increasingly political, with Treasurer Gina Raimondo asking when Chafee's administration found out about the company's problems. Raimondo is widely believed to be considering a run for governor.
"A company does not run out of money overnight," Raimondo, a Democrat, told The Providence Journal Tuesday. "A company is not a year behind (on) product development overnight. So the question is: how has the state been monitoring this investment?"
Chafee brushed off the criticism Wednesday, saying his administration stepped in as soon as the company's troubles came to light.
"She's free to be critical," Chafee said of Raimondo. "But she better be factually accurate, and on this she's not."