EDC is ‘not broken,’ says Chafee

GOV. LINCOLN D. CHAFEE plans to keep the R.I. Economic Development Corporation intact for the rest of the year and in his proposed budget for next year, he told reporters Thursday afternoon.
Posted 11/30/12

PROVIDENCE - Gov. Lincoln D. Chafee will keep the state’s formerly beleaguered economic development apparatus intact for the rest of the year and in his proposed budget for the next fiscal year, he said Thursday.

“The [R.I. Economic Development Corporation] is not broken,” Chafee told reporters after elevating William J. Parsons, the veteran EDC official he put in temporary charge of the quasi-state agency after it was rocked by the 38 Studios crisis, to the position of permanent executive director. Parsons’ appointment still requires Senate confirmation.

In explaining why he chose to keep Parsons in charge, Chafee cited “institutional knowledge,” Parsons’ work stabilizing the agency after 38 Studios and his ability to transition EDC toward serving businesses within Rhode Island instead of luring them from elsewhere.

On why he chose to pass on recommendations made in a study he commissioned after 38 Studios to subsume the EDC within the executive branch of state government, Chafee said both the agency’s problems and the state’s economic problems have been overblown.

Changes to the EDC made by Director of Business Regulation Paul McGreevy, with Parsons, have improved the agency and rid it of flaws that contributed to its granting a $75 million loan guarantee to the now bankrupt 38 Studios LLC, Chafee said.

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