RI economic chief says state’s deal with Schilling game company expected to close in mid-Sept.

RI-Schilling deal expected to close in mid-Sept.

PROVIDENCE, R.I. — A top Rhode Island economic official said Thursday he expects to close by mid-September on a controversial $75 million state loan guarantee for the video game company of former Red Sox pitcher Curt Schilling.

Keith Stokes, executive director of the state Economic Development Corp., said that’s a bit later than the Aug. 31 closing date that was anticipated when the deal with 38 Studios was approved by the group’s board on July 26. A specific closing date has not been set, but he said such a process typically takes 30 to 60 days. He said there’s nothing unusual about the delay, which happened within the past week or so because of the complexity of the deal.

“We’re within that Aug. 31 timeframe,” he said.

The loan guarantee requires 38 Studios to relocate from Maynard, Mass., to Rhode Island. The company has promised about 450 jobs — with an average salary of $67,500 — by the end of 2012. As the company meets certain benchmarks, money will be released to the company in installments.

When the loan closes, 38 Studios would receive an initial $15 million from private lenders, which would be guaranteed by the state. The state is not providing any money to the company, but if 38 Studios defaults on its private loans, the state would be on the hook to pay them back.

Stokes and Gov. Don Carcieri have said the deal will create badly needed jobs in a state with an 11.9 percent unemployment rate in July, the fourth worst in the country. But the deal has emerged as a hot issue in political races this year, with critics saying the deal is too risky and puts too much of the state’s $125 million loan guarantee fund on the line for a company with no proven track record.

One critic, former Sen. Lincoln Chafee, who’s running for governor as an independent, said through his campaign spokesman Thursday that the short delay is good news because it allows for more time for people to express concerns or even stop the deal.

“The senator continues to believe that this has been a bad deal for the people of Rhode Island,” Chafee spokesman Mike Trainor said. “We remain hopeful that the EDC staff and board will find a way to reconsider their position.”

Another critic of the loan guarantee is General Treasurer Frank Caprio, the Democratic candidate for governor.

The timing of the deal’s closing caused a bit of a kerfuffle between Chafee and Caprio on Thursday when, during a gubernatorial forum, Caprio accused Chafee of misrepresenting the timing of the deal.

“Fifteen million dollars is going out the door, according to the agreement, on Tuesday, Aug. 31,” Chafee said.

“Mr. Chafee, you do not have your facts straight,” Caprio replied.

Trainor said Chafee based his comments on the information that was publicly available.

“To harp on what we would consider to be a fairly minor detail begs the bigger question, which is our belief that this is a bad deal for the people of Rhode Island,” Trainor said.

Caprio spokesman Nick Hemond said Caprio objected to Chafee’s comment because it gave the impression that there was no time left to change the terms of the deal.

“If you’re following it closely and speaking so strongly, you should know the latest facts on the deal when you speak on it,” Hemond said.