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Monday, September 23, 2013

Copar gets its third local quarry site

Relax, Klondike Road, it’s in Richmond. 
They’ll get to you soon enough
By Will Collette

The notorious Connecticut-based Copar Quarries have secured their third local mine site, this time right on Route 138 in the heart of Richmond. The official address is 58-60 Kingstown Road, although those two addresses are actually the site of two small buildings. I just found a lease Copar signed in April with Richmond Realty to mine stone in the huge tract of land slated to become the Richmond Commons mixed-use development.

The plan for Richmond Commons includes just under 400 units of housing (333 apartments) plus business space. It will encompass 45 buildings and over 700,000 square feet of residential and commercial space. If it is actually built, it will be the largest development in Richmond’s history. 

However, there is one aspect of the lease with Copar that makes me wonder if this project will actually be carried out.

This tract is located behind the shopping complex in Wyoming that contains the Stop & Shop, a Job Lot and lots of other businesses.

Copar will essentially mine the land in a way that prepares it for the developers to build the Richmond Commons. 

The lease stipulates that Copar will contour and grade the land and build permanent and temporary roads, in addition to blasting and crushing rock and excavating sand which they will sell to their customers.

Click here to read the lease. Click here to read their blasting permit.

John and Ann Marie Aiello of North Providence own Richmond Realty and its related company, Aiello Realty. They signed a two-year lease with Copar that ends on April 30, 2015.

Copar’s rent in the first year is $100,000. That rent rises to $150,000 in the second year.
Copar will be allowed to take out up to 8,333 tons per month royalty-free. After they hit that level, they will pay the Aiellos a royalty of $1 a ton. In the second year of the lease, Copar gets to mine up to 12,500 tons per month royalty-free, after which the $1 a ton royalty kicks in. See pages 2-3.

In case you’re puzzled by those royalty numbers, it basically works out to $1 a ton for both years. If you multiply the number of royalty-free tons per month that Copar can extract, it comes out to 100,000 tons for the first year and 150,000 tons in the second. At $1 a ton, that works out to the amount of the rent.

In 2009, Copar CEO Sam Cocopard offered to sell gravel to Rhode Island waste hauler Joe Vinagro for $2 to $3 a ton. Of course, at that time, Cocopard didn’t actually have any gravel to sell and simply kept the $20,000 Vinagro paid him. For that, Cocopard was convicted of larceny last January and is currently serving an 18 month suspended sentence.

Is Richmond Commons actually going to get built?

Phil Armetta (photo courtesy of Steven Devoto,
Middletown Eye)
Copar has the option to simply purchase the property from the Aiellos (see page 15-18) for $12 million - $3 million in cash and the Aiellos are willing to give Copar a $9 million three-year 4.5% mortgage so Copar can buy them out. 

If Copar buys the property from the Aiellos, the deal would include “all plans, specifications, approvals, permits and licenses” for Richmond Commons, presuming that’s what Copar would want to do with the land.

When I saw this provision in the lease, it made me wonder whether the Aiellos are having second thoughts about Richmond Commons. However, before they make any further deals with Copar, they ought to have a little talk with the Comolli family.

The lease deal is signed by CEO Cocopard and Copar’s money man, Phil Armetta.

Armetta’s specialty throughout his long career – he’s now 82 – has been acquiring quarry sites and turning them into waste disposal facilities. 

The Richmond property is an attractive prospect for a large regional waste site – even more so than the Bradford or Charlestown Copar sites – because it is much bigger and far more accessible. As many area residents have noticed, there’s been a sharp uptick in the number of shiny purple Copar trucks on our area roads – I saw three of them in the span of five minutes at noon on September 20 in downtown Westerly.

Kleen Energy - an Armetta dream. A giant "recycling" plant inside an old
quarry in Middletown, CT. Blew up killing six workers
The Richmond Commons site is right on Route 138 and practically next to the Exit Three ramps for I-95.

A careful reading of Phil Armetta’s history and widely varied interests also shows that Phil has dabbled quite a bit in real estate and business development. 

That makes it possible that we could see Copar buy the property from the Aiellos, mine it for all its worth and then build the Richmond Commons project themselves.

Obeying the law

On page six of the lease, Copar is required to abide by all federal, state and local laws, regulations and administrative rules. Violations of the law may be viewed by the Aiellos as a breach of contract by Copar. Copar is required to indemnify the Aiellos and carry a lot of insurance (page 7). Copar can’t bring any hazardous waste onto the site or store any hazardous materials except in strict compliance with the law (pages 11-13).

Richmond Town Clerk Tracy Nelson told me that Copar has not applied for a business license in Richmond. I’m looking forward to when Copar does that because Richmond has a simple “bad character” provision in its town ordinances:

A.  No license or permit will be issued to, or renewed for, any person or business in arrears in any tax or assessment levied by the town. Verification of payment of taxes and assessments must be submitted with any application for, or renewal of, a license or permit. Payment of town taxes and assessments shall be a continuing condition of the license or permit.

B.  An applicant for a license or permit must submit with the application or renewal an affidavit of compliance. The affidavit shall state that the business is currently in compliance with all town, state, and federal statutes, ordinances, and regulations. Compliance with all town, state, and federal statutes, ordinances and regulations shall be a continuing condition of the license or permit.

Unfortunately, Richmond does not require every business to apply to receive a business license. I’ve asked for a legal opinion on whether Copar is required to get a license. If they do, they will need to demonstrate they are in compliance – and remain in compliance – with federal, state and municipal law. 

If they submit an affidavit, they will need to admit their dozens of citations from the federal Mine Safety and Health Administration, plus their EPA, DEM and Town of Westerly violations. Most of those are still pending.

An honest reciting of their violations should lead to a denial of a business permit from Richmond. If they don’t disclose their track record on the affidavit, they could not only be denied the permit but could face criminal charges if the Attorney General took an interest.

Copar’s amazing business history continues as they make yet another major acquisition despite the criminal past and failed businesses of their management team. Somehow, Copar seems to come up with the money to add more land and put more trucks on the road.

In my opinion based on my research, there are only two ways this can end. Either the whole mess will collapse as have Sam Cocopard’s previous businesses, leaving out-of-pocket creditors wondering where their money went.

Or we could see Phil Armetta’s business model of taking old quarry sites and turning them into waste sites become a major industry for the southwest corner of Rhode Island.