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Agency puts bond rating on watch over 38 Studios

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News,Business

PROVIDENCE, R.I. (AP) — A ratings agency has put Rhode Island's bond rating on a negative watch because of uncertainty over whether the state will honor debt stemming from the failure of Curt Schilling's 38 Studios.

Standard & Poor's said Monday it has put the state's general and moral obligation debt on watch "with negative implications." It also lowered its rating on the $75 million in bonds sold to benefit the ex-Red Sox player's video game company.

An independent analyst predicted Friday Rhode Island's bond rating would be downgraded to junk status if the General Assembly defaults. Some lawmakers want Rhode Island to walk away from the remaining $87 million it owes from the failed deal approved by the former Economic Development Corp.

Gov. Lincoln Chafee says the debt should be honored.

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