SJ Advisors was hired by the state of Rhode Island to study the potential long term cost of not honoring its moral obligation on the 38 Studios Bonds. The bonds were issued in 2010 by the Rhode Island Economic Development Corporation under its Job Creation Guaranty Program. 38 Studios filed for bankruptcy in 2012 leaving the state to consider its moral obligation to make the remaining $87 million of principal and interest payments through final maturity in 2020.
As part of its debate around the nature of the obligation and importance of honoring it, the General Assembly tasked the Department of Administration with hiring an independent firm with the expertise to study the issue and report findings. SJ Advisors was selected for this challenging and critical assignment.
SJA is an independent municipal advisory firm, registered with the SEC and MSRB and had no role in the original transaction or any transactions related to the program or the Corporation. The authors, Steve Johnson and Linda Port, have over 30 years of experience in the municipal bond market.