Chafee Urges State to Pay Off 38 Studios Bonds Following Downgrade

Jun 19, 2013

Gov. Lincoln Chafee says Moody’s is sending Rhode Island an important message by downgrading the state’s bonds for its failed deal with 38 Studios.

Governor Lincoln Chafee is urging the state to pay off the money owed for loans on 38 Studios following a downgrade from Moody's.
Credit Catherine Welch / RIPR

The credit rating agency downgraded the bonds by two notches and put the state on notice that the rest of its obligations are under review for a possible downgrade.

Lawmakers are debating whether to default on the moral obligation bonds used to float the failed video game company. Chafee said as Moody’s has shown, that’s a bad idea.

“Well, it’s a significant message to the General Assembly about living up to our obligations. And there are going to be consequences if we don’t, we’ve already seen the consequences on 38 Studios but really the extension to the other bonds are what’s really important," said Chafee.

Chafee’s budget includes a 2-point-5 million dollar payment on the nearly 90 million dollars owed on the 38 Studios bonds.

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