By Terrence McCoy
By Scott Fishman
By Deirdra Funcheon
By Allie Conti
By New Times Staff
By Ryan Pfeffer
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By Kyle Swenson
In April 1996 Fadgen called his friend, attorney Cornelius Cunningham. Cunningham says Fadgen told him there was man dying who needed a will. The will Cunningham helped Vanella draw up called for Fadgen to become president of Vanella Enterprises, the company that owns and operates the strip mall, and to serve as trustee and personal representative of the estate in probate court. Fadgen was also made legal guardian of Vanella's 17-year-old son, who continued to live in Vanella's Plantation home. So, while Fadgen didn't outright own the strip mall, he controlled it in every way.
Fadgen has routinely portrayed his willingness to take over the strip mall simply as an attempt to honor his dying friend's wishes. It may be that his motives were as pure as the driven snow. But Fadgen was also breaking the law. State ethics laws forbid elected officials from forming contractual relationships with businesses that are regulated by their own governmental body. Not only was Fadgen president of Vanella Enterprises, but he was negotiating on behalf of the company directly with his own city in an effort to stave off foreclosure.
And Fadgen, regardless of his motives, has also made money from his involvement with Vanella Plaza. The public, however, wouldn't know that. The state Commission on Ethics recently reported in a press release that Fadgen "received no compensation for his service" from the Vanella estate, and The Miami Herald followed that up with a story stating that the councilman didn't receive a dime from Vanella Enterprises.
Not true. These myths have been fostered by Fadgen and his attorneys. It's true that Fadgen didn't receive money from the estate while serving as personal representative -- a point his attorney trumpeted at a recent Commission on Ethics hearing. Fadgen had waived those fees. But he did award himself a $1500 payday as "accountant" of the estate. As for the corporation, Fadgen paid -- and continues to pay -- himself an hourly rate for his work there, according to Plantation businessman Phil Demeo, who is currently serving as president of the corporation.
While Fadgen doesn't deny this, he also won't say how much he's made, and the information isn't a matter of public record. But there is the possibility of significant profit. The strip mall, which is assessed by the county to be worth roughly $600,000, generates thousands in rent each month from its dozen or so tenants. Fadgen also had the ability to set the rent on his own office in Vanella Plaza, which houses his wife's photography studio as well. (Again Fadgen would not disclose how much rent he pays.)
What's more, the will Cunningham drafted for Vanella dictated that Fadgen would control the estate and assets until the year 2009, when Vanella's son will finally take over, at the age of 31. In essence Fadgen was slated to make himself an income from Vanella Enterprises for 13 years -- no minor thing for a smalltime independent accountant like Fadgen.
Fadgen enjoyed one other little-known fringe benefit: He could hire his political friends to work on behalf of the strip mall.
There's nothing politicians covet more than the ability to dole out favors, and for Fadgen the strip mall became something of a favor clearinghouse. In August 1996, just a few months after he took over as president of Vanella Enterprises, he awarded a contract to fix up the plaza to RCA Construction. RCA is owned by then-councilwoman and current mayor Rae Carole Armstrong and her husband, Tom. The business just happened to be located in the Vanella strip mall, right next door to Fadgen's office.
In 1997 Fadgen gave RCA -- which recently moved out of the strip mall -- a second contract to help correct code violations. Combined, the contracts generated more than $8000 worth of business.
State law holds that elected officers are forbidden from having a "contractual relationship that will create a continuing conflict between" their private interests and public duties. Fadgen and Armstrong's relationship appears to fall under that category.
"A red flag should go up," says Ernest Bach, a long-time board member of Common Cause of Florida, a political watchdog group. "There is a very obvious potential for conflict of interest there, when it's dealing with two elected officials on the same council and it's dealing with code violations within that city."
It's pretty clear that Armstrong broke ethics laws by accepting the contracts. She was contracting with a company that was subject to an enforcement action by her city, and RCA was actually making the city-ordered improvements. Her conflict has only deepened since she became mayor last year. Now she is ultimately in charge of enforcing code laws at the strip mall.
The cozy contractual relationship between Fadgen and Armstrong has never been disclosed publicly. And Armstrong still won't talk about it openly. After last week's city council meeting, Armstrong refused to comment on the strip mall or the RCA contracts. She bristled at the notion that her actions constituted a conflict of interest, going so far as to threaten to have a reporter physically removed from city hall.
The mayor isn't the only powerful player who Vanella Enterprises employed. There was also Ron Kall, a prominent Plantation architect hired to design a cosmetic overhaul of the strip mall. Kall also happens to be one of Fadgen's campaign contributors and has good reason to pad Fadgen's coffers: The architect often appears before the city commission, asking for variances and waivers of city rules on his building projects. Fadgen rarely, if ever, votes against Kall's projects. Reached by telephone, Kall said he was in a meeting and promised to call back. He never did and didn't return additional messages seeking comment.