The aftermath of 38 Studios defaulting on a $75 million investment and its subsequent bankruptcy has caused lawmakers to create a new government post. The Rhode Island legislature has passed a bill creating the new position of commerce secretary, a gubernatorial appointee. The bill which was opposed by Gov. Lincoln Chafee passed early Tuesday morning and without the Governor's signature. The bill creates a cabinet-level secretary position that will be in charge of the state's economic development efforts and the duties of the Department of Business Regulation. Chafee expressed doubts about the proposal, saying the changes would detract from efforts to boost the economy.
The new post would also be in charge of the Economic Development Corp. Separate legislation giving the state Economic Development Corp. a new name – Rhode Island Commerce Corp. – and creating a separate nine-member council of economic advisers to oversee it became law last week, also without the governor's signature.
Lawmakers felt that, after the failure of the Economic Development Corp.'s $75 million investment in 38 Studios, some dramatic changes and major oversight needed to be put in place.
The changes come after top lawmakers vowed to prioritize efforts to improve the state's business climate amid the fallout from the Economic Development Corp.'s failed $75 million investment in 38 Studios, the bankrupt video game studio founded by former Red Sox pitcher Curt Schilling. Chafee has replaced most of the group's board already in the aftermath of the default on that loan, and has appointed a new executive director.