FOR YEARS, Michael W. Piccoli, a Smithfield contractor, had been angling for a piece of the action from Governor DiPrete's administration.

Piccoli & Sons had shown its support for Edward D. DiPrete in ways large and small: donating to his mayoral and gubernatorial campaigns, paving his driveway at no charge, soliciting political contributions, dispatching road crews across Rhode Island to erect DiPrete for Governor signs.

Now, in 1988, Michael Piccoli was rewarded.

Governor DiPrete appointed Piccoli to the board of the Rhode Island Solid Waste Management Corporation, the agency that runs the state landfill and recycling programs. And the Friends of DiPrete, the governor's campaign-finance committee, invited Piccoli to join.

Later that year, at a DiPrete fundraiser, Piccoli met Dennis L. DiPrete. The governor's son smiled and congratulated Piccoli on his appointment to the Solid Waste board.

The younger DiPrete, just 30, was a successful engineer. Although he did not hold a post in the DiPrete administration, many contractors would later tell a grand jury that they had viewed Dennis DiPrete as the man to see for state work.

Michael Piccoli and Dennis DiPrete started having lunch at Providence "power'' restaurants -- Raphael's, the Capital Grille. According to Piccoli's later testimony, Dennis DiPrete asked Piccoli to keep him informed of state work coming up at the Central Landfill; Piccoli told DiPrete of his own interest in state work.

Piccoli told the grand jury that for state-landfill work, he had followed Dennis DiPrete's directions on selecting contractors. He also said that he had collected contractors' contributions to Governor DiPrete's campaign.

IN APRIL 1992, four years after meeting Dennis DiPrete, Michael Piccoli found himself sitting in a conference room with the Rhode Island attorney general, surrounded by prosecutors and investigators.

The prosecutors had made a deal with Frank N. Zaino, the Cranston engineer, giving him immunity for his testimony that he had delivered bribes to Dennis DiPrete for state contracts.

Now Atty. Gen. James E. O'Neil rattled off the potential criminal charges against Piccoli. There was evidence, said O'Neil, that Piccoli had been fleecing taxpayers for years. In Cranston, he'd stolen hundreds of thousands of dollars, submitting false bills and bribing city officials; at Solid Waste, he'd used his position to shake down contractors.

Piccoli sat in silence. The only time he betrayed emotion was when O'Neil told him his wife was also in trouble, for having apparently cooked the company books. The contractor's face flushed.

The attorney general brought up the state's investigation of the DiPretes and asked for Piccoli's cooperation.

"I can't give you the governor,'' responded Piccoli. "But I can give you Dennis.''

On April 23, 1992, Michael Piccoli pleaded guilty to taking $90,000 in bribes for state and Cranston-city contracts.

Two months later, a Rhode Island prosecutor appeared in a Massachusetts courtroom seeking to subpoena records from Dennis DiPrete's engineering business. He said that the younger DiPrete had engaged in "extortionate schemes'' to profit from state contracts while his father was governor. Dennis DiPrete denied the allegations.

MICHAEL PICCOLI seemed to love playing the big shot.

After Governor DiPrete appointed him to the board of the Solid Waste Management Corporation, he took to cruising the Central Landfill, which is located in Johnston. Talking on the car phone, he maneuvered his gold Lincoln Continental along the dirt roads through a mountain range of garbage -- the gulls wheeling overhead, the heavy trucks lumbering below.

It was a fitting environment for Piccoli. Having followed his two older brothers into their father's construction business, Piccoli, a burly man in his 40s, had become the master of his own Rhode Island barter system.

Court records show that he signed a contract to pave a road with four inches of asphalt, then used two inches; to cover his tracks, he bribed public officials with cash and favors. To one, he gave money for a trip to Disney World; for another, he sent workers to dig a hole for a back-yard swimming pool.

Piccoli & Sons had built its reputation doing the unglamorous part of construction -- digging the holes, laying the sewers, trucking the gravel, building the roads. By the 1980s, Michael Piccoli had traded in his days of shoveling steaming asphalt for the country-club life of the executive. But he still knew how to get his hands dirty.

Nowhere was that clearer than in Cranston, where the driveways of the city's mighty were paved with Piccoli's good intentions.

Throughout the '80s, as Piccoli & Sons reaped millions of dollars from Cranston city sewer work and other contracts, Piccoli paved, at no charge, the driveways of several city officials and their relatives.

When he heard that one City Hall official had had his driveway done by another contractor, an "upset'' Piccoli, according to court records, called the official and told him that Piccoli & Sons should have been allowed to do the work.

Piccoli also kept tee times with Cranston's dignitaries, and entertained them at his condominium in Florida. He treated officials, including Mayor Michael Traficante, to a Boston Red Sox game in a Fenway Park luxury box; court records show that Piccoli spent about $4,000 for the game.

The Cranston taxpayers subsidized Piccoli's generosity, through the inflated construction bills he submitted to the city.

Piccoli & Sons' run of prosperity in Cranston began while Edward DiPrete was mayor; when he ran for governor, in 1984, the Piccolis set their sights on state contracts.

They contributed to the DiPrete campaign, and donated Piccoli & Sons road crews to erect DiPrete for Governor signs.

For three days that October, as DiPrete stumped the state promising an ethical revolution in government, Piccoli & Sons labored at the candidate's house. Workers installed curbing, put in a new driveway, and resurfaced the tennis court.

The job cost between $7,000 and $10,000, but, according to court records, DiPrete paid nothing.

BY 1988, PICCOLI & SONS had gotten some state work from Governor DiPrete's administration. But Michael Piccoli was still awaiting the big score.

This was when a seat opened on the board of the state's Solid Waste Management Corporation and Piccoli went after it and was appointed by Governor DiPrete. It was also the year that Piccoli was invited to join the DiPrete campaign-finance committee. And, as Piccoli later told a grand jury, as he got to know Dennis DiPrete, he began taking Dennis's direction in the selection of contractors for work at the state landfill.

Piccoli testified that he would let the Solid Waste staffers know which contractors Dennis DiPrete wanted by looking out the office window toward the State House and nodding.

Meanwhile, Piccoli pursued his own deals with landfill contractors. One gave him $200 a week in cash, Piccoli later told investigators, which he put in his pocket for "walking around'' money.

According to court records, Piccoli told a state-police detective that he once gave the Solid Waste chairman, Richard A. Johnson, 10 100-dollar bills, asking Johnson to cut him in on any deals he had cooking -- "to become a player with me.''

Johnson, in response to The Providence Journal's request for an interview, wrote that he had been "friendly'' with Piccoli. He denied having participated in any illegal activities, and said he had cooperated with the authorities.

"I had nothing 'going on' with respect to the activities of the Solid Waste Management Corporation,'' he wrote, "and there was no involvement with Mike [Piccoli] or anyone else in any 'sharing' of monies.''

Tom Wright, a former Solid Waste official, said that Piccoli spent an inordinate amount of time at the landfill, meddling in the day-to-day operations, as well as contract negotiations.

Meanwhile, in Smithfield, the Piccoli & Sons employees complained that Michael Piccoli was neglecting his business.

He always seemed to be on the phone with Dennis DiPrete, they said -- if not attending political fundraisers or golfing with Cranston officials.

"Where's the work?'' one of his brothers would holler in the office. "How come we're not getting any work?''

Not to worry, Mike assured everyone. "A lot of gravy is coming.''

IN 1989, THE STATE was under pressure to build an addition to the Intake Center at the prison, to accommodate the overflow of prisoners awaiting trial. That fall, court records show, Michael Piccoli told his employees that Dennis DiPrete had said to him, "This one's yours.''

Piccoli & Sons was to be the main site contractor, overseeing all the preparation and excavation.

Then, bad news. State jobs have to go through competitive bidding and Piccoli could not post the necessary insurance bond.

The job went to Laura Donatelli, the daughter of a North Providence contractor who, as a woman, qualified as a minority contractor.

But her company owned no construction equipment and employed no laborers. She needed Piccoli, court records show, and hired him as a subcontractor.

Piccoli, in his testimony, said that Dennis DiPrete had assured him that all was set: " 'My father drives by the prison every day, and he only wants to see Piccoli trucks on the job.' ''

It was a rush job, so Piccoli had crews at the prison seven days a week for four months, running up weekly payrolls of $20,000. When the job was done, in early 1990, Piccoli received $50,000 from Donatelli. But he had been counting on nearly $400,000 more.

Piccoli told the grand jury that he hounded Donatelli and her father, Clark Donatelli, for the money. He implored Dennis DiPrete to exert his influence. But to no avail.

WHILE HIS crews were busy at the state prison, Michael Piccoli was busy with another scheme.

One day in February of 1990, A. Robert Lusi, a fellow contractor, stopped by Piccoli's office.

The two were neighbors in a Smithfield office park, but A. F. Lusi Construction was a bigger player than Piccoli & Sons. The Lusi company routinely got multimillion-dollar federal contracts, such as one from the Navy to build a testing facility for missile launchers.

The company's founder, Robert's older brother, Armando F. "Gus'' Lusi, displayed his wealth in novel ways. One Christmas he gave his wife a 10-ton waterfall for their Johnston back yard; he had a granite outcropping dynamited and heat installed to keep the water flowing in winter.

Robert Lusi had seen Michael Piccoli around the state dump, where A. F. Lusi Construction had some work. Now the big contractor, aware of Piccoli's ties to the governor, sought the smaller contractor's help in getting a state job.

"Yup,'' replied Piccoli. "You target a job, and we'll see what we can do for you.''

A few months later, according to Piccoli's testimony, Gus Lusi returned from a Florida vacation and took over the negotiations with Piccoli. He had his eye on the planned $600,000 expansion of the University of Rhode Island's library.

The job appealed to the Lusi brothers, loyal sons of the university. "URI,'' Gus Lusi said to Piccoli, "since I'm an alumnus.''

Later, the Lusis and Michael Piccoli would appear before the grand jury and give similar accounts of the Lusi brothers' cash payments for the URI job.

Piccoli told the investigators that he had reported the Lusis' interest to Dennis DiPrete. A few days later, he recalled, DiPrete told him the URI contract would cost $60,000 -- 10 percent of the $600,000 fee the Lusis stood to make.

Piccoli, in his testimony, said that Gus Lusi's response to the offer was "I'll gladly give him the $60,000.'' In their testimony, the Lusi brothers said they had agreed to each put up $30,000. Robert Lusi kept his money in a safe-deposit box at a Johnston branch of Fleet Bank; Gus Lusi kept his in his desk drawer.

On May 15, 1990, a DiPrete aide telephoned Gus Lusi to tell him Lusi's firm had landed the library job. Although the contract wouldn't be official for another 10 days, the Lusi family wired the good news to Robert, vacationing in Bergamo, Italy.

In the ensuing months, the Lusis paid $40,000 in kickbacks, including a $5,000 "finder's fee'' to Piccoli. The sum also included a $10,000 campaign check to "Victory '90,'' a DiPrete-sponsored Republican fundraiser featuring President Bush ("That was an extortion in my opinion,'' Gus Lusi later testified).

In October of 1990, during the last weeks of Governor DiPrete's unsuccessful reelection campaign, Gus Lusi gave Michael Piccoli a sealed envelope to give to Dennis DiPrete.

Piccoli later testified that at that time he had been smarting over his loss on the prison job -- the $400,000 that he contended the Donatellis owed him. Piccoli decided to take his anger out on Dennis DiPrete, who had failed to help him get the money.

Piccoli took Lusi's envelope into his office bathroom, opened it, and removed $5,000; he placed the remaining $10,000 in a new envelope, he testified, then left a message at Dennis DiPrete's office to call him.

Later that day, Piccoli testified, Dennis DiPrete called him from his car phone while driving home from New Hampshire; Piccoli asked DiPrete to stop by his office. (To corroborate Piccoli's story, the authorities subpoenaed DiPrete's cell-phone records, which showed a call to Piccoli at the time in question.)

A few hours later, according to Piccoli's testimony, Dennis DiPrete swung by Piccoli's office and picked up the envelope with the $10,000.

MICHAEL PICCOLI'S financial problems only worsened after Edward DiPrete left the governor's office.

The $400,000 loss that Piccoli claimed on the prison project sent his company into a downward spiral from which it never recovered.

In the spring of 1991, Piccoli resigned in embarrassment from the board of the Solid Waste Management Corporation. A Providence Journal story had revealed his company's failure to pay $9,000 in dumping fees; Piccoli said he hadn't been able to afford them.

In December, Piccoli & Sons went out of business. Piccoli's $320,000 house in Lincoln went on the market; his Lincoln Continental was later repossessed.

He had also run up several thousand dollars in gambling debts to a bookmaker at a country club he frequented; at one point, the bookie directed Bob Buehne, a mob associate now in the federal Witness Protection Program, to trail Piccoli.

Meanwhile, the state police were interviewing Piccoli's ex-workers about his dealings in Cranston.

Early in 1992, Piccoli and his wife, Patricia, stopped by their now vacant offices to pick up some files. Two state-police detectives arrived with a subpoena; they wanted everything involving Cranston.

NOT LONG AFTER THAT, Michael Piccoli found himself sitting in the attorney general's office, listening to the recitation of his crimes.

"You've got some choices to make,'' said Attorney General O'Neil.

Less than two weeks later, Piccoli walked into a Providence courtroom and pleaded guilty to five felony charges. He admitted to crimes involving the state landfill, the City of Cranston, and Governor DiPrete's administration.

He was bound for prison -- the only person in the DiPrete case who has spent any time behind bars. A prosecutor recommended a lenient sentence, because of Piccoli's pledge to cooperate.

The sentence would later become a subject of controversy. Lawyers for the DiPretes noted that the prosecutors had allowed Piccoli to pay just $135,000 in restitution to the City of Cranston -- far less than the $1 million he admitted stealing from the city.

A few months after Piccoli pleaded guilty, the Lusi brothers obtained immunity in exchange for their testimony about the payoffs for the University of Rhode Island library job.

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