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Speaker Fox says he’ll defer to the General Assembly on the possibility of defaulting on the 38 Studios bonds

October 23, 2012

House Speaker Gordon Fox — one of the most powerful people in state government — wants to defer to “the entire General Assembly” on whether the state should consider defaulting on the moral obligation bonds for 38 Studios.

The move comes after Fox, during a taping of a televised debate last Friday, said considering defaulting on the bonds is “an option.”

That led the speaker’s legislative opponent, Mark Binder, to question whether Fox had changed an earlier stance against default.

In response to a request for comment, Fox’s campaign spokesman, Bill Fischer, offered this statement:

“The Speaker simply articulated that it was an option; he didn’t infer in any way that he was leaning towards exercising default as an option. The Speaker is cognizant that any legislative appropriation would require extensive House Finance Committee hearings.

As repayment would be a major appropriation, after and when hearings occur, House members may have strong feelings one way or the other, so he answered the question in the context of giving the entire General Assembly a chance to weigh in on this important subject.”

Pressed on Fox’s personal view, Fischer noted that Binder has accused the speaker of autocratic tendencies. Fischer then went to say that issues such as the possibility of default require “consensus-building.”

The idea of default on the 38 Studios bonds remains hotly contested. Some observers suggest it would serve a valuable purpose; others contend it would damage Rhode Island’s reputation.

The debate continues as computers, illustrations and other trinkets are being auctioned off today at 38 Studios’ former Providence office.

UPDATE: Andrew Morse makes the case at Anchor Rising that the full General Assembly should have been consulted before the state made its losing investment in 38 Studios.

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