While Washington Teachers' Union President Barbara A. Bullock allegedly was spending union money on furs and alligator shoes, the labor organization failed to pay rent, telephone bills and other expenses on time or at all, and misdirected money budgeted for pensions and other purposes, according to sources familiar with the finances.

The union also failed to deliver key services to its members, the sources said. For example, it allowed the D.C. school system to ignore deadlines for addressing grievances brought against teachers, several union members said.

"Absolutely, they were not delivering services while she was out shopping," said one union activist with knowledge of some spending anomalies. The activist spoke on condition of not being identified, citing fear of retribution from union leaders.

Bullock, who became president of the 5,000-member union in 1994, resigned this fall as federal and city authorities began investigating allegations of financial irregularities. According to an FBI affidavit filed last week, she spent more than $1 million in union dues on personal items, including designer clothing.

Sources said that while artwork and Tiffany silverware were being purchased, the union repeatedly was late paying its rent, telephone and electric bills. Last year, the union was ordered to court amid complaints that it violated its office lease, but the money was paid at the last minute, the sources said.

The union also was late in making tax payments to the Internal Revenue Service for union staff members, as well as in paying hundreds of thousands of dollars in dues to its parent body, the American Federation of Teachers, the sources said.

The union's interim president, Esther S. Hankerson, did not return telephone calls yesterday. A day earlier, she said in an interview that she and leaders of the parent union were attempting to unravel how more than $2 million in union funds was allegedly misspent in the past seven years.

On Thursday, FBI agents seized bank documents, tax records and hundreds of luxury items from the residences and offices of Bullock and former assistant Gwendolyn M. Hemphill, according to documents filed in U.S. District Court. Hemphill was once campaign co-manager for D.C. Mayor Anthony A. Williams (D), Authorities also searched the residence of James O. Baxter II, the union's former treasurer.

Like Bullock, Hemphill resigned after being asked to do so by the union's 22-member executive committee. Baxter was ordered to step aside pending results of the investigation.

No charges have been filed in the case. Law enforcement sources said the matter is likely to be considered by a grand jury.

According to the sources familiar with union spending, the labor organization also apparently misspent funds that its executive committee budgeted each year for reimbursing its school building representatives for their dues.

The union has a policy of reimbursing dues if building representatives meet certain requirements. And each year, the executive committee approved enough money -- usually up to $80,000 -- to reimburse all of the roughly 150 building representatives in the D.C. school system, the sources said.

But the union gave the money back to at most 10 building representatives each year, the sources said. From 1995 to 2002, at least $600,000 was budgeted for this use, but it is unclear where the money went, the sources said.

The executive committee also typically budgeted up to $100,000 a year for a pension fund for union staff members. But pension statements sent periodically to union staff, including Hankerson, showed that the fund was virtually empty, the sources said.

Hankerson confirmed this week that she had been told about discrepancies in union funds but said that she was unsure how much might be missing.

Union auditors also are investigating whether the local organization failed to pay premiums to two health care providers for retired teachers who had been members, the sources said.

Retired teachers paid their premiums for health and dental benefits to the union, and the union was to turn over the money to the providers, United Optical and Dental Benefit Providers. But some payments were not made, the sources said, and retirees were denied benefits last year for glasses and other services.

Staff writer Justin Blum contributed to this report.

Barbara A. Bullock resigned this fall after having served as president of the 5,000-member Washington Teachers' Union since 1994.Gwendolyn M. Hemphill had been Bullock's assistant. She also was asked by the union's 22-member executive committee to resign.