May 16th, 2012 at 5:54 pm by Ted Nesi under Nesi's Notes
By Ted Nesi and Tim White
PROVIDENCE, R.I. (WPRI) – Congressman David Cicilline holds a slim lead over his Democratic primary opponent Anthony Gemma with less than four months to go before voters will decide which man should face Republican Brendan Doherty, an exclusive WPRI 12 poll released Wednesday evening shows.
May 16th, 2012 at 4:04 pm by Ted Nesi under Nesi's Notes, On the Main Site
The new WPRI 12 poll in the 1st Congressional District’s Democratic primary we’re releasing at 6 p.m. surveyed precisely 302 likely Democratic primary voters. You might think that means our esteemed longtime pollster, Joe Fleming, made 302 phone calls to get his results.
But it took many more calls than that to get a representative sample of the district’s voters – more than 5,000 calls when all was said and done, according to Fleming. “You need the right age groups,” he said. “At the end of it, you may be asking for a male or somebody who’s 18 to 39″ – that is, the people hardest to track down.
That’s important because any poll’s results are only as reliable as the people who took the survey. It’s especially tricky with a primary, where only about 25% of registered voters turn out to the polls, he said.
Luckily for us, nobody in Rhode Island has more experience getting polls right than Joe Fleming. He’s been with WPRI 12 since 1984, and still recalls making waves with bygone surveys such as one that put DiPrete and Sundlun in a dead heat.
I’m betting the results dropping at 6 p.m. will cause a similar stir when we release it on TV and online.
• Related: Exclusive WPRI 12 Poll: GOP’s Doherty has big lead over Cicilline (Feb. 27)
May 16th, 2012 at 1:29 pm by Ted Nesi under Nesi's Notes
By WPRI Staff
PROVIDENCE, R.I. (WPRI) – Former Red Sox ace Curt Schilling pleaded for additional state assistance on Wednesday morning at an emergency meeting of the R.I. Economic Development Corporation called to discuss its $75 million loan guarantee for 38 Studios, his video-game company.
Update: The EDC released a statement this afternoon – here it is – along with this fact sheet (PDF):
The RIEDC Board of Directors met in closed session to receive a presentation from representatives of 38 Studios as to the company’s confidential financial status and projections. Members of the Board asked many probing questions of the company. After representatives from 38 Studios concluded their presentation, the Board then engaged in extended discussion of confidential financial information. The Board did not take any vote. The company still has the option to cure the existing default by paying the $1,125,000 guaranty fee that is past due. In the meantime, we will continue to talk with 38 Studios and develop additional information, and will resume the Board meeting at our regularly scheduled meeting on May 21. The members of the Board may not discuss the confidential information received and discussed today.
May 16th, 2012 at 12:16 pm by Ted Nesi under Nesi's Notes, On the Main Site
By Tim White and Ted Nesi
PROVIDENCE, R.I. (WPRI) – Anthony Gemma says he’s hiring Christopher Nocera, a former staffer to Buddy Cianci and Patrick Kennedy, as the campaign manager for his Democratic primary bid in Rhode Island’s 1st Congressional District.
“At this point we have hired some top staffers,” Gemma told WPRI.com on Wednesday. “Chris Nocera will be the campaign manager and that will be announced shortly with a couple of other staffers that we have.”
Nocera, who currently works for the Providence Water Supply Board, told WPRI.com he has not accepted the offer from Gemma yet but is “seriously considering it.” He said he’s known Gemma his whole life and thinks he’d “make a great congressman” but the candidate jumped the gun by revealing his plans.
Nocera, the brother of New York Times columnist Joe Nocera, worked for Kennedy when he was a Rhode Island state representative after managing his first General Assembly campaign in 1988. He later worked for the Cianci administration and in 2011 got a job with newly elected mayor Angel Taveras after working on his campaign.
May 16th, 2012 at 9:28 am by Ted Nesi under Nesi's Notes, On the Main Site
May 16th, 2012 at 5:00 am by Ted Nesi under Nesi's Notes, On the Main Site
Mayor Taveras at 38 Studios' HQ
It’s pretty clear at this point what happened to 38 Studios over the past two weeks that caused such consternation.
For some reason – likely a shortage of cash, though we don’t know for sure – 38 Studios failed to make a $1.125 million payment to the R.I. Economic Development Corporation that was due on May 1. That put the company in technical default of its bond agreement, sending the company scrambling to find other sources of funds.
As I explained Tuesday, the $1.125 million is an “Annual Guaranty Fee” (based on the percentage of the outstanding loan) that 38 Studios is supposed to pay the EDC annually on May 1. Based on EDC documents, it doesn’t look like the fee is to cover bond payments or anything like that; it’s just money the EDC gets to keep.
That raises the question of why the EDC is charging such a fee at all, and especially how it ever expected 38 Studios to have $1.125 million lying around before the game it’s funding has even been released. Startups are notoriously short of cash, almost by definition - they’re spending money but not making it (yet). Expecting 38 Studios to have more than $1 million available without “Copernicus” on sale was always a recipe for trouble.
Still, if 38 Studios has burned through all of the nearly $50 million it’s gotten from the $75 million loan without “Copernicus” anywhere near ready for release, it raises serious questions about whether the company is undercapitalized. Now the EDC board must decide if Rhode Island doubles down to salvage its original investment.
Update: Just before noon – three hours after the EDC board meeting began – Governor Chafee’s spokeswoman confirmed that the group was “ordering lunch and settling in.” Schilling and 38 Studios executives are at the meeting to brief them about the situation.
(photo: city of Providence)
May 15th, 2012 at 9:55 pm by Ted Nesi under Nesi's Notes, On the Main Site
For what it’s worth, at least one source thinks 38 Studios has sold more than a million copies of its first game.
VGChartz, a website that tracks industry sales, estimates “Kingdoms of Amalur: Reckoning” has sold 750,000 units in North America, 250,000 units in Europe and 120,000 units in the rest of the world outside Japan. As a comparison, NPD Group estimates “Reckoning” has sold at least 410,000 units in North America.
It would seem like good news for the cash-strapped studio if “Reckoning” sales are already above 1 million – but are VGChartz’s numbers reliable? The Boston Globe cited the site on Tuesday, but back in 2008 Gamasutra’s Simon Carless warned about serious problems with its methodology.
For the moment, then, caveat emptor on this statistic.
(h/t: Patrick Laverty)
May 15th, 2012 at 5:02 pm by Ted Nesi under Nesi's Notes
By Ted Nesi and Sean Daly
PROVIDENCE, R.I. (WPRI) – The R.I. Economic Development Corporation board scheduled an emergency meeting for Wednesday morning after Curt Schilling’s video game company failed to make a required $1.125 million to the state, raising concern about its cash situation.
May 15th, 2012 at 3:01 pm by Ted Nesi under Nesi's Notes
Update: House Speaker Gordon Fox just confirmed to WPRI 12′s Sean Daly that 38 Studios defaulted on May 1 when it failed to make the $1.125 million payment to the EDC that I discussed below. More to come.
Update #2: Sean Daly and I have posted a full report on WPRI.com.
Curt Schilling’s video-game company 38 Studios was supposed to make a major payment to the R.I. Economic Development Corporation on May 1, and now the quasi-public state agency won’t say whether it ever received the money it was owed.
Under the terms of the 2010 deal between 38 Studios and the EDC, the company agreed to pay the agency an “Annual Guaranty Fee” on May 1 each year. Documents obtained by WPRI.com say the fee is equal to 1.5% of the average amount of outstanding bonds, minus any amount in a prepayment account.
Based on that description it’s unclear exactly how much 38 Studios was supposed to pay the EDC at the start of this month. But with $75 million in bonds still outstanding, 1.5% of that total would be $1.125 million. The documents say failing to make the required payment to the EDC would be a technical default by 38 Studios.
Somewhat confusingly, the Annual Guaranty Fee that 38 Studios owes the EDC each May 1 is separate from the twice-a-year payments made to investors who purchased the $75 million in bonds.
May 15th, 2012 at 12:57 pm by Ted Nesi under Nesi's Notes, On the Main Site
John Robitaille, the former aide to Governor Carcieri who placed second in Rhode Island’s 2010 gubernatorial race, says the financial turmoil at Curt Schilling’s 38 Studios shows why government shouldn’t pick winners and losers.
Robitaille compared the deal to the Obama administration’s controversial support for Solyndra, and the Republican said he expressed concern at the time about the $75 million taxpayer-guaranteed loan that Carcieri and the R.I. Economic Development Corporation board approved in July 2010 with Democratic legislators’ support.
“Initially I was not in favor of it, but once it was approved and signed off on, absolutely I was on board to make sure it was successful,” Robitaille told WPRI.com in a phone interview on Tuesday. “My initial position was that it appeared to be risky and that I’d rather see 75 $1 million loan guarantees going out to more companies.”
At this point, he said, “We should do everything we can to make them successful, and if that means renegotiating something, fine. … It’s done. It’s a done deal. Should it have been done? People can debate that for eons. It depends on what you think government should be doing in economic development.”
Nesi's Notes covers politics and the economy in and around Rhode Island for WPRI.com. (Twitter: @NesisNotes_WPRI)