Kawhi Leonard secretly invested in RIFC. Why that matters for Rhode Island taxpayers

Rhode Island Gov. Dan McKee called on Rhode Island Football Club to publicly disclose all of its owners in the wake of a report by WPRI that revealed NBA star Kawhi Leonard is among them.

An investigation by WPRI connected RIFC and the construction of Centreville Bank Stadium in Pawtucket to an ongoing investigation by the NBA into Leonard’s endorsement deals.

Eli Sherman, an investigative reporter with WPRI, spoke with morning host Luis Hernandez about how the NBA star is connected to the Rhode Island soccer team, and why it matters.

Interview highlights

On why it matters who is invested in RIFC 

Eli Sherman: Rhode Island is putting up an extraordinary amount of money, the public's money, into this stadium. Currently, we're on track to pay back $116 million over 30 years to have put $27 million of construction costs into that stadium. It was a deal that really drew scrutiny from people who cover finance and business, including Bloomberg, which called it an “eye-popping yield” because it was such a high-risk loan…

So for people who care about how the public's money is being spent and who the public is in business with – you have to keep in mind that it wasn't even just like a lowly reporter like myself didn't know that Kawhi (Leonard) was on this list of undisclosed investors that are now making money off of the stadium that the public helped build, but people very close to the deal, people who were helping to put it together on the public side, they didn't even know that he was involved. So there's just a level of opacity, a lack of transparency, around the deal that we got into that, from my perspective as a reporter who's always trying to figure out the government's business, it felt like a story worth telling.

On plans to secure tax breaks for housing near the stadium 

Sherman: The promise has been, “Okay, we're going to do this stadium, that is going to be the anchor, and then we're doing the housing.”

To the credit of the developers, they are in process of trying to get that housing done. They've promised more than 400 units around the stadium. They've already gotten tax breaks from Pawtucket to get it done, and they're currently back at the (statehouse) asking for more public subsidies through RI Housing. So it's still a few years away. And keep in mind that when they promised it in 2019, it was also a few years away.

How Kawhi Leonard is involved – I've asked that question to a lot of people, and I do not know if he has some element or some piece of the housing development side of it…Just like the stadium deal, there isn't great transparency into who exactly is going to be funding the private side of what would theoretically end up being another public-private partnership.

On why he’s continuing to investigate

Sherman: It's just important to know that this is one of the biggest investments that Rhode Island has made in the last six, seven years. And there's a lot of economic activity that still is supposed to happen around that area where there's going to be a lot of money floating around.

I encourage people to keep a close eye on all of it because it's always interesting when some deal like this happens and then years later you find out that someone is involved in it that you didn't know about. And I think Rhode Island is kind of a place where there's already high skepticism around public-private partnerships because the state's been burned in the past. Most notably, people will think of 38 Studios, but it's hardly the only example. And I think that especially when using so much public money on projects like this, that the level of scrutiny should be high all around.