Here’s something I haven’t seen anyone mention amid all the excitement over Fidelity moving workers from Massachusetts to Rhode Island – the state is giving the company significant financial assistance in return for building out its Smithfield facility.
The EDC borrowed a combined $35 million on Fidelity’s behalf to help the company pay for upgrades and then an expansion in Smithfield – $25 million in 1996 and another $10 million in 2002. Rhode Island taxpayers are also shouldering part of the payments so long as Fidelity keeps meeting certain targets for employment here.
EDC Executive Director Keith Stokes specifically cited the Fidelity agreement in defending the 38 Studios deal to the press last year. A third-party consultant monitors Fidelity on behalf of the EDC to keep tabs on whether it’s in compliance, he said.
Rhode Island spent $2.6 million in 2008-09 to cover its share of Fidelity’s repayments, Revenue Department documents show. The outstanding balance on the original $35 million debt was $27.7 million as of June 30, 2009, the documents say.
A separate report shows Fidelity received tax credits from Rhode Island worth $5 million in 2008-09 and $3.5 million in 2009-10. I’m not sure how those two payment streams interact, if at all; EDC spokeswoman Judy Chong said she is putting together materials explaining Fidelity’s state support now.