North Bay Village Commissioner Bob Dugger must dream of a day when he won't be hounded by criminal investigators, state regulators, the Internal Revenue Service, irate business clients, and his own police department. Not only is the State Attorney's Office investigating Dugger for possible violations of public-corruption laws, but his private business is being scrutinized by the Florida Department of Business and Professional Regulation. The IRS is after him for at least $360,000 in back taxes, and two weeks ago, following publication of a New Times story detailing Dugger's questionable conduct as a public official ("Thug Meets Pug," October 2), 25 North Bay Village police officers signed a petition demanding that he resign from the city commission.
Now come new charges, many in response to "Thug Meets Pug," alleging that Dugger's business operation, Timberlake Management (also known as the Timberlake Group), has mismanaged numerous condominium associations throughout Miami-Dade County. In addition several people who've had business dealings with Dugger are providing more evidence that, in his role as a city commissioner, he has a conflict of interest arising from his friendship with Adolph "Al" Coletta, a real estate investor who owns several properties in North Bay Village, including a penthouse atop the Bayshore Yacht and Tennis Club condominium.
The public-corruption unit of the State Attorney's Office is investigating whether Dugger, in exchange for financial assistance, sold his city commission vote to Coletta, who wants to change the zoning on his penthouse in order to open a nightclub. (Such a quid pro quo is a third-degree felony.) Prosecutors are also weighing charges against Dugger for allegedly lying on the financial-disclosure forms required of all elected officials, a felony under state law.
Florida's Department of Business and Professional Regulation, in response to complaints from local condominium owners, is trying to determine whether Dugger violated state law in managing the Highlands of Kendale and the Peppermill condominiums in Kendall, the Kennedy House condominium in North Bay Village, and several other condo associations in Miami-Dade. (Four earlier state investigations were closed owing to insufficient evidence, but in 2001 Dugger was fined $1000 for withholding documents from homeowners and "committing acts of gross misconduct.")
A spokeswoman for the Department of Business and Professional Regulation would not comment on the pending investigation, but Dugger's condominium-association clients, current and former, are eager to share their horror stories about the property-manager-turned-politician and his wife Rachel, who works closely with her husband. "If Dugger had the best interest of our community in mind, our community would be bright and clean," says Gabriel Collazo, a 52-year-old condo owner at the Highlands of Kendale, a 200-unit condominium complex. "Our community has been rundown for quite a long time."
A recent tour of the complex reveals patches of dead grass in common areas, mildew streaks marring the exterior walls of several dozen units, rotting wood fences, and other signs of poor maintenance. In five years, Collazo charges, Dugger has never provided a financial statement or a budget for the Highlands: "Every time we request documentation, it falls on deaf ears. They try to keep us in the dark as much as possible."
According to Collazo, he and three neighbors have been frustrated in their efforts to win seats on their condo association's board of directors. He blames the Duggers and their involvement in the election process. "We don't know what else to do," Collazo says.
One option: They could file a lawsuit against their own association to rid themselves of Timberlake. That's what other condominium associations fed up with the Duggers have done. In the case of Peppermill, a 236-unit condominium building, 27 homeowners last year successfully sued their board to wrest financial control from Timberlake Management. As a result of the lawsuit, the homeowners were able to elect a new board that fired the company. Prior to the lawsuit, Peppermill's predominantly Hispanic board was heavily influenced by Cuban-born Rachel Dugger, says condo owner Thomas Shaffer, who led the fight to oust the company but was not a plaintiff in the lawsuit. "She called the shots," he says, "and she drove us into the ground."
Shaffer, who is being sued for libel by members of Peppermill's previous board, asserts that Rachel Dugger, who managed day-to-day affairs, routinely harassed residents by threatening liens and foreclosures. Over two days in June 2002, court records show, she had the association's attorney, Eric Glazer, file 28 liens against Peppermill homeowners who purportedly owed money to the association.The homeowners' lawsuit alleged that Timberlake interfered with board elections, bounced 23 checks in one month, and allowed the condo association's property and flood insurance to lapse, among other apparent violations of state law. "You look at these circumstances," says Shaffer, "and you wonder how state regulators allow [the Duggers] to stay in business."
Al Coletta's sudden involvement in Peppermill's financial affairs also disturbed Shaffer. According to several homeowners, two years ago Peppermill was unable to secure a bank loan for building repairs, so Bob Dugger and attorney Glazer introduced Coletta to the board as an "angel investor." Public records indicate that in June 2002 Coletta loaned the association $250,000 at twelve-percent interest with a two-year balloon payment -- terms the lawsuit claimed were significantly higher than prevailing rates.
Although the association, on Bob Dugger's recommendation, had hired Glazer as its attorney, Glazer unexpectedly revealed to the board that he had a conflict of interest because he was representing Coletta in the loan deal. Board members okayed the arrangement anyway. Later the association had to pay Timberlake a $15,000 broker's fee, while Glazer pocketed $5000 in attorney fees, say several condo owners. The lawsuit claimed the board "improperly" committed Peppermill's homeowners to the loan. Thomas Shaffer puts it this way: "No lawyer in his right mind would have allowed us to sign that agreement."
In Hialeah the Imperial Terraces condominium board of directors terminated and then sued Dugger's Timberlake Group this past August. (The case was recently settled.) According to the lawsuit, the condo's board fired Timberlake because Dugger did not enforce condo rules, was late in paying bills, and could not provide an accounting of how he was spending the association's money. Upon being fired, the association alleged, Timberlake refused to return documents and disrupted board meetings.
The Duggers have been no less controversial in their hometown. In January of this year Timberlake Management won a contract to manage the 230-unit Kennedy House condominium in North Bay Village. The five-member board fired the association's previous property manager and attorney and replaced them with Timberlake and Glazer -- this despite the objections of condo owners who attended the January association meetings at which the changes took place.
Tim Morris, an owner who videotaped the meetings, believes the fix was in. He points out that three of the board members, including current association president Elida Temporini, are friendly with the Duggers and worked as volunteers for Bob Dugger's city commission campaign in 2002. (Temporini did not return phone calls seeking comment.) In the months since then, one of those board members has died and another was defeated in a recent election. Morris, who won a board seat as vice president, wants to fire Timberlake because, among other problems, the Duggers did not produce any financial statements during the first six months of their employment, despite their promise to do so. "As a result," Morris says, "we're facing a $5000 state fine."
According to promotional material used by Dugger, Timberlake administers more than 30 condominium associations in Miami-Dade County. In most of those arrangements Dugger has retained Hallandale attorney Eric Glazer to represent the interests of condo owners.
Glazer, who declined comment for this story, also regularly represents Al Coletta in his many real estate transactions. It was Glazer who acted on Coletta's behalf when he recently filed a lawsuit against North Bay Village. Coletta claims the city has diminished the value of his condominium penthouse by refusing to rezone the property for commercial use. On several occasions Glazer appeared before Dugger and his colleagues on the city commission, arguing Coletta's case for a zoning change. That argument was strongly supported by Dugger, who was unsuccessful in persuading the rest of the commission to side with Glazer and Coletta.
After citizen complaints that he had a conflict of interest regarding the Coletta zoning matter, Dugger sought an ethics ruling from the North Bay Village city attorney and the Miami-Dade County Commission on Ethics and Public Trust. Both issued opinions in his favor. Dugger, however, had not revealed to either arbiter his professional ties to Glazer or his long-time relationship with Coletta, who has financially bailed out Dugger on several occasions.
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In September the Florida House's Select Committee on Condominium Association Governance held a public hearing at Miami Coral Park High School to gather information in anticipation of rewriting the state's outdated condo laws. As committee chairman, State Rep. Julio Robaina (former mayor of South Miami) got an earful from disgruntled condo owners, but one thing stood out: Robaina says he heard more complaints about Bob and Rachel Dugger than any other property managers. "I've labeled these people the Condominium Mafia," Robaina says. "The stories are horrible. There is a total lack of accountability by the Duggers and others like them."
Robaina wants the legislature to enact a host of reforms, including mandatory criminal and financial background checks on individuals who apply for or renew their state-mandated licenses to manage community associations. A financial background check might pose problems for Bob and Rachel Dugger. Timberlake Group owes the IRS more than $260,000 in unpaid payroll taxes. This is in addition to roughly $100,000 in personal income taxes Bob Dugger owes the federal government. The Florida Department of Revenue has also filed 29 tax liens against Timberlake Management and Timberlake Group for not paying state taxes.
In addition to their tax debts, the Duggers have a long history of foreclosures against them. In 2001, for example, they lost a commercial building in this manner. Even their pal Coletta has foreclosed on personal properties they owned. "If you can't handle your own finances," says Robaina, "you shouldn't have the fiduciary responsibility of managing community associations."
Bob and Rachel Dugger declined comment for this story when they were approached at a recent North Bay Village civic meeting. Bob Dugger, however, did take the time to chastise New Times: "You're not interested in pursuing the truth. You're interested in printing lies on yellow paper."