The Economic Development Corporation of Rhode Island finds itself highly dysfunctional in the wake of 38 Studios going bankrupt and not being able to meet its obligations related to $75 million loan. The pseudo government-corporate entity has been without an executive director since May when Keith Stokes decided to resign over the loan to 38 Studios. Today we have learned from several published reports that another loan the EDC approved is not going to be paid back and that another executive has resigned.
The latest company to default on loans is Capco Steel LLC, who received a $6 million loan from Webster Bank through the EDC's R.I. Industrial Facilities Corporation two years ago to expand and improve its operations in Providence. The loan was guaranteed for up to $5 million by the EDC's Industrial Recreational Building Authority (commonly referred to as IRBA).
It was also revealed today that the chief financial officer for the EDC is stepping down. Sue Morgan, who has served in the CFO role since 2007, will leave on Friday to "pursue opportunities outside of government."