LLCs On The DL

LLCs On The DLHow does a regulatory board know if the homeowner with business before the board, or a member of the board itself, has a conflict of interest?

It would certainly help if the municipality — and the public, and the media charged with holding the government to account — knew the name of the homeowner. But, through the use of limited liability companies, or LLCs, that’s not always how it works.

Property owners use LLCs to hide their identities from the public and the government. Attorneys can represent Mr. and Ms. LLC through the process of securing permits to build or renovate a home or business — securing variances, changes of zone and special exception permits along the way — all while never revealing who their clients are. One would like to think attorneys wouldn’t get on board with doing anything untoward, but without the watchful eyes of the municipality or the press, how would anyone ever know?

The anonymity of LLC ownership has increasingly become the norm for luxury homes. But that could change.

Sagaponack Village is the latest South Fork municipality to require LLC owners to disclose their identities when they have business before a regulatory board, a practice previously enacted in the villages of Southampton and East Hampton.

With all the money at stake, and all the sensitive lands and waters on the East End subject to environmental protection, knowing that both elected and appointed officials are free of conflict is of utmost importance. This is the most basic of government transparency and should be adopted across the region.