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SAN BENITO — City officials are considering taking legal action against an investigative firm accusing Mayor Rick Guerra and Commissioner Deborah Morales of nepotism while claiming City Manager Fred Sandoval is violating the City Charter requiring he live in town.
On Tuesday, Sandoval said officials are mulling a lawsuit against Dolcefino Consulting, accusing the Houston-based firm of harassment.
While considering taking legal action, officials are subpoenaing some of the firm’s records, Sandoval said.
“We’ve discussed it at length and we’re investigating further because this is getting to the point of harassment,” Sandoval said in an interview.
Sandoval noted he and city officials are “public figures,” which makes them subject to scrutiny.
“I know we’re in the public eye,” he said. “Scrutiny and transparency — there’s a bright line between that and harassment. This is a political campaign without an election — an attempt to discredit the mayor, the council, the EDC and me.”
In response to Sandoval’s disclosure of the city’s consideration of a lawsuit against his firm, Wayne Dolcefino, the firm’s owner, described his investigation as “legitimate.”
”If they see that as harassment, let’s bring it on,” Dolcefino said. “He’s a public official. These are legitimate questions. If he wants to use taxpayer money to sue me, I will see him at the courthouse. That is such a blatant misuse of taxpayer money. Tell Mr. Sandoval to put his big-boy pants on.”
In response to the city’s subpoena requesting records, he said, “they are not going to get my records.”
Meanwhile, Sandoval and city officials believe VARCO real estate, a Brownsville company which has filed a lawsuit against the city over the development of the Resaca Village retail center, is behind Dolcefino’s investigation.
While Dolcefino has declined to disclose who hired him, Paul Serafy, an attorney representing VARCO, has said the company did not hire Dolcefino’s firm.
On July 12, Dolcefino Consulting released a video titled “Arrogant with Power,” in which Dolcefino accuses Guerra and Morales of nepotism while claiming Sandoval is violating a charter clause requiring the city manager live within the city limits.
Since taking office last October, Sandoval has continued living in his home in Pharr.
On Tuesday, Guerra and Morales did not respond to messages requesting comment on Dolcefino’s claims of nepotism.
In the 15-minute video, Dolcefino accuses Guerra of appointing his cousin John Flores, who was convicted of sexually assaulting a 13-year-old girl, to the city’s Economic Development Corporation’s board of directors.
On an EDC form, Flores described Guerra as his cousin.
In a previous interview, Guerra said he did not know of Flores’ criminal history.
In the video, Dolcefino also points to a lawsuit in which the San Benito Housing Authority’s former executive director claimed board members fired her because she fired Guerra’s brother Johnny Guerra for sexual harassment.
In 2022, Yvette Nieto, the housing authority’s former executive director, filed a federal lawsuit against Guerra and then-board Chairman Ben Cortez, claiming they fired her as a result of “discrimination and retaliation” amid a “hostile work environment.”
The lawsuit states Nieto fired Johnny Guerra following her investigation into allegations of sexual harassment.
The lawsuit in U.S. District Court was dismissed.
In the video, Dolcefino accuses Morales of nepotism, citing her for appointing her husband Jose Luis Morales to the EDC board and her son to another city board.
At City Hall, Sandoval said personal matters are holding him back from moving into the city.
“I’m actively looking to see what I can find,” he said.
In Dolcefino’s video, Sandoval says he’s “never” moving to San Benito.
“They quoted me badly,” he said in Tuesday’s interview. “I lost my temper — they were picking on the mayor.”
Now, his son is a high school junior in Pharr, while he is serving as his 85-year-old mother’s “primary caregiver,” Sandoval said, adding, “I can’t be away from her for a very long time.”
Around the time he was hired last October, he told commissioners he planned to move to town, Sandoval said.
“The board asked me if I would move to San Benito, and I said I would,” he said. “But I had some personal matters that don’t allow we to pull up stakes right away. I love San Benito. I would love nothing better than to move here.”
Sandoval added state law does not require him to live in San Benito to serve as city manager.
“Technically, statutorily, I don’t have to live here,” he said.
Citing local Texas Government Code Section 150.021, Sandoval pointed to a law stating, “a municipality may not require residency within the municipal limits as a condition of employment with the municipality, adding, the prohibition doesn’t apply to “municipal department heads appointed by the mayor or governing body of the municipality.”
As city manager, he’s not a department head, Sandoval said.
As part of his arguments, Dolcefino described Sandoval, who serves as the EDC’s executive director, as the city’s “cheerleader,” working to draw new business to town.
“If he doesn’t live there, why should they,” Dolcefino said, referring to prospective businesses.
In the video, Dolcefino noted commissioners removed Commissioner Carol Lynn Sanchez, who had three weeks left on her term, because she had moved out of the city limits to run for state office.
The video marks the second Dolcefino has released since mid-June.
Since then, city officials have said they believe VARCO is behind the investigation, while Serafy has said the company did not hire Dolcefino.
In April, VARCO filed a lawsuit against the city, claiming the EDC breached the parties’ contracts surrounding the development of Resaca Village, failing to “honor its obligations” under an agreement extending its construction timeline while claiming its amendments “void” because city commissioners had not approved them.
In response, the city filed a counter suit, claiming VARCO breached its contract when the company failed to comply with the city’s agreements granting extensions on the project’s completion, originally set for 2022.
“VARCO sued, they told me, because they felt the city was trying to steal the project in the 11th hour,” Dolcefino said. “Why are we going into litigation in the 11th hour — because you’re mad about the deal?”
