Meet the man behind the USA Springs project

Francisco Rotondo is hoping to present a handcrafted Bowie knife next month to President George W. Bush.

Rotondo is a former Olympic marksman who will be representing the United States in the World Cup shooting competitions. He builds Ferraris from scratch, and imported them into the country. He even sold one to Ralph Lauren.

Yet Rotondo, after spending more than three years and $3 million — cannot get a permit to allow his company, USA Springs, to pump water out of his land he owns that straddles Barrington and Nottingham in southeast New Hampshire.

And he is now facing the daunting task of cleaning up a contaminated site that he never polluted.

While the controversial USA Springs water bottling project has lingered — hampered by state environmental officials, town litigation and public opposition — the 44-year-old Rotondo has let his lawyers do the talking. But early this month, a clearly frustrated Rotondo spoke out publicly for the first time, flanked by two partners in the USA Springs venture — Armando Hyatt, a Salem attorney who also advises Rotondo on the project, and Jeffrey DeLucia, vice president.

In an interview with New Hampshire Business Review, Rotondo charged environmental officials – against the advice of his attorney – with “legal extortionism.” He blamed an “invisible force” for holding up his permit – a move motivated by a mixture of racism and envy.

The interview took place shortly before Dec. 11, when the DES again denied the permit, but Rotondo said he will challenge that decision and that he wasn’t going to go away.

“What does it take? Do you have to speak the Queen’s English in order for you to get permitting the state of New Hampshire?” Rotondo asked. “Just because I’m blown in from Rome, Italy, it means that I shouldn’t have the opportunity or because you are jealous and envious that I have wonderful ideas … and I have this gift from God.”

Who is Rotondo?

Water has become an increasingly economic and ecological issue in New Hampshire, but no other project in the state has been as contentious as USA Springs’ request to withdraw more than 300,000 gallons per day out of the aquifer that runs beneath several communities dependent on well water. The proposal was one of the first large groundwater withdrawal proposals under new state regulations.

Then-Gov. Jeanne Shaheen, one of the architects of the 1998 groundwater withdrawal laws, pointed to the USA Springs project during her failed US Senate campaign as an example of those “ who see water simply as a commodity, to be bought and sold without regard to the consequences for New Hampshire’s people and environment.”

Residents organized by Save Our Groundwater have held mass meetings and picketed the site, and the town of Nottingham has taken them to court.

While USA Springs’ proposal only counts as a small portion of the 9 million gallons withdrawn daily by municipalities, industry (including beverage companies), agricultural and even golf courses in 2002, it would nearly double the amount of bottled water withdrawn in 2002.

But what exactly is USA Springs, and who is its president, Francisco Rotondo?

Ironically, Rotondo said he got into the water business because he was looking for a company that was both environmentally friendly and patriotic.

Rotondo said he fell in love with the United States after he moving here at 12 while visiting with his father, who stayed despite a lucrative concrete business back home in Rome. Rotondo’s dream was to join the Air Force, but at 17, he was not yet a citizen. (He became a citizen roughly 25 years ago.)

Instead, Rotondo graduated from high school in Lawrence, Mass., to attend go to architecture school at ITT Technical Institute in Woburn, Mass. He later switched to mechanical metallurgy because he liked building things with his hands. Soon he was working for EG&G building cathode ray tubes used in nuclear tests in the late 1970s.

His technical abilities led him in vastly different directions. As a marksman, he entered shooting competitions for Beretta, who sponsored him on the 1984 Olympic team, which he made as an alternate. But he also suggested modifications for the firearms which earned him some “very nice royalties.”

Soon Perazzi, another Italian gun manufacturer was using his services and he boasted, “I invented what is today the best shotgun for American trap shooting: the MX15.”

Ferrari was another one of Rotondo’s passions, and he was soon rebuilding vintage cars from scratch and selling them — a business that lasted four years.

Rotondo designed the presidential Bowie knife as part of an Alamo presentation in New Hampshire for President George Bush by the New Hampshire Sportsmen Association, which Bush is supposed to attend in January.

Despite these eclectic interest Rotondo only foray into a traditional business — manufacturing women’s clothing in Massachusetts – ended in failure in 1990, when the economy turned sour

However, his association with another textile manufacturer from Italy – Giuseppe Prevosti — led Rotondo and Hyatt to purchase some real estate in Barrington, under such names as Golden Ponds Hunting and Fishing Corp. The idea was to import all sorts of exotic species and create a “hunter’s paradise,” in the words of Hyatt.

It also would, said Rotondo, expand Prevosti’s U.S. investment portfolio, easing the way for the Italian to gain U.S. citizenship.

The properties resulted in Rotondo’s first run-in with the state Department of Environmental Services, which fined Rotondo $2,000 for wetlands violations in 1994 after a road was built through a wetland area.

Prevosti abandoned the project, not because of DES oversight, but town opposition, Rotondo said.

“The man got fed up with all the hysteria from Barrington,” Rotondo said.

Rotondo and Prevosti parted ways six years ago because of “personal differences,” Rotondo said, and Prevosti took over the corporations in 1995. Prevosti is not sure what he plans to do with those properties, his attorney said last month.

A bitter battle

While Rotondo said that none of these properties – contrary to opponents’ speculation – have anything to do with USA Springs, they did help Rotondo becoming familiar with the area. Still searching for an environmentally friendly business, Rotondo was told by an Italian doctor that the two best such businesses were waste management and spring water. Rotondo saw the need for waste management, but knew of the high regulatory hurdles that would entail.

“I naively thought that this would be the easiest way to waltz through the bureaucratic factor,” he said. “There can be nothing more cleaner than the spring water business.”

He quickly studied water-quality issues in New England, and under the name Garrison Place Real Estate Trust purchased the 100-acre lot 1998, just as the new law on water withdrawals was being enacted.

What attracted Rotondo was not only the land but an old barn “that was ready to fall down and kill you if you walk in it,” Rotondo said. “A lot of people said it needs a match.”

But Rotondo thought it needed restoration, pouring, he said, $250,000 of his own funds into the effort

“I always considered myself a Yankee, and I had a vision” of a big barn with a huge flag, he said “a showcase of an historical aspect of a Yankee-based American company.”

The barn apparently did get a match. The fire marshal ruled arson, and Rotondo said the FBI is investigating. Rotondo suspects opponents of his plant torched it. Some opponents that Rotondo did it himself for sympathy. Both scoff at the other’s suspicions, but the fire has given this contentious battle a bitter edge.

There are two major areas of contention — quantity and quality. Opponents contend that the area can simply not support that kind of withdrawal Rotondo is seeking in times of drought. Rotondo contends that USA Springs passed a $1.2 million pump test with “flying colors.”

However, DES didn’t totally agree, saying in August that the report based on the tests was “not complete or correct” and “not assessed accurately.”

Rotondo complained that he was subjected to such scrutiny under the new law while other bottling companies – grandfathered in before the new regulations — are so busy that they offered their water to USA to bottle at the plant he plans to build on site.

“Why is it OK for me to bottle water down the street in Brentwood and Hampton and not OK to bottle my own water in the ground, which makes my business more feasible and makes my business more money?” he challenged.

Continued cleanup

But the bigger issue now has to do with water quality, because the pumping test sucked in contaminated groundwater from a neighboring plot owned by K and B Reality Trust, a site that once housed a trucking firm. That caused DES to label the USA Springs site a potential Superfund site, much to Rotondo and Hyatt’s chagrin.

First, they said, the levels on the land were not nearly high enough to be considered for the Superfund list. Second, DES should have used the name of the legal owner of the site, which is Garrison Place Realty Trust, not USA Springs.

“They were trying to destroy the business name,” exclaimed Rotondo.

DES withdrew the listing, but wanted further testing to show that continual pumping would not cause contamination of the neighboring site.

In June, Just Cause Realty Trust bought a neighboring 14-acre property for $250,000. (While the trust is not a “mirror image” of USA Springs, “there might be some overlap,” said Hyatt.)

In any case, the new owners of the land are pretty much giving USA Springs a free hand to clean it up, or at least contain it. At one DES meeting concerning Just Cause, instance, no one from Just Cause even signed in.

DES officials said that it would cost at least $250,000 and could take years to maintain the site. On the other hand, Tony Giunta, of the department’s Water Supply Engineering Bureau, did acknowledge that thus far USA Springs was moving at a quicker pace than he has ever seen.

Taking on DES

So DES was in a quandary. On the one hand, the law called on the agency to make a 45-day decision on the permit, a time frame that has already been extended repeatedly, and there was no telling how long the clean up would take. On the other hand, if the department had to decide on a permit now, the answer would probably be no. So DES instead offered USA Springs the option to ask for a stay — a way to put the process in suspended animation, and stop the clock from ticking.

This move, however, irked Rotondo who claimed to have already sealed the pollution off. He thinks that DES should grant his company a conditional permit. The latest offer amounts to “legal extortionism,” he told the Business Review.

“Don’t use that word,” protested Hyatt.

“If I don’t say it once, we are never going to say it. The truth must be told. This is legal extortionism.”

Those weren’t Rotondo’s only strong words.

“At this stage, that permit lawfully belongs to me, and I can’t put my hands on it,” said Rotondo. “It’s been written conditionally to every other businessman in the state but me. Are they trying to make an example of me or what? You think they should be thanking me for what I’m doing instead of putting me down and killing me.”

Rotondo’s attorney did ask for a stay, but DES denied it anyway on December 11, arguing that Rotondo did not promise to meet the conditions necessary to continue the permit application. Then it denied the permit again. Rotondo said he will continue to fight for the permit, in court if necessary.

“This is one Italian that isn’t going to go away,” he said.

Rotondo’s environmental attorney, Greg Smith, says that the decision is “unfathomable” and a case of “moving the goal posts.”

While Rotondo has been critical of DES, he had only praise for Governor Benson’s appointees at DES, former acting Commissioner Bob Monaco and current Commissioner Michael Nolin. Rotondo said he strongly supports Benson and contributed to his campaign.

“The new government is definitely more business-friendly for the state, which is what the state needs,” he said.

But Rotondo thinks that in state government, there is some “invisible force who is trying to put a stop on a good man who is a good steward, who is trying to clean that site next door from achieving his permit.”

Still, he says he can clean up the site in half the time that DES predicts. “We proved them wrong again and again, and they hate us for it. When they say it takes us a year to clean up the site, we will do in six months, and we already started.”

How much money can Rotondo keep pumping into a project to pump water out of the ground? And where will that money come from?

Rotondo and Hyatt both said they will spend what it takes. Thus far, Hyatt said, all of the money – some $3 million — has come from “friends and family members” of Rotondo, Hyatt and DeLucia, including Rotondo’s brother, Marco, an engineer in Hampton.

But Hyatt declined to name any other owners or principals in USA Springs, citing the need to protect their privacy. He did say that there is no large international water company lurking in the background. It’s just a company operating out of Rotondo’s house.

“We are not acting as a front,” Hyatt said. “It’s people who believe in Francesco. He’s the man who will put the needs of the situation ahead of his own needs. He’s attracting the capital because you can’t hold a good man down.”

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