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Clarkstown Adopts New LLC Registry And Disclosure Law

The Town of Clarkstown has historically been a model municipality for fair and effective
enforcement of Building, Safety, and Fire Codes. Under my administration, we have
continuously looked for ways to improve on the Town’s well-deserved reputation for doing things
the right way and protecting the health, safety, and quality of life of our residents. From the
hiring of additional Code Enforcement Officers, to establishing a registry of rental homes and
passing a local law banning short-term rentals on residential properties, the Town has been a
leader in doing everything it can to ensure code compliance. But just as the Town gets better at
enforcement, those looking to circumvent the rules continue to find new ways to avoid being
held accountable.


Single family homes have been traditionally owned by one or two individuals. Over the past
decades, many homes have been moved into trusts, but those are typically tied to just a few
individuals, usually the children of the current owners. In these cases, it’s very easy to look at
the tax roll and know exactly who owns any given home in Clarkstown. Recently, there has
been a growing trend where homes are purchased by LLCs and then rented out on the open
market. That’s all perfectly legal, and in most cases there’s no issue with that setup. However,
the built-in anonymity that LLCs offer provides an easy and effective way for code violators to
hide from investigators.


At last week’s Town Board meeting, we unanimously adopted a new local law that institutes an
LLC registry with mandatory disclosures of owners. The law requires any LLC purchasing
residential property in the Town of Clarkstown to register and make known all individuals with a
5% or greater ownership share in the corporation. Specific contact information for each person
must be provided in this listing. This legislation will close the increasingly common loophole that
is created when property violations are issued, but the Town’s legal department gets tied up in
knots trying to establish who needs to be brought to court. The Town will now have a list of
individuals with contact information, removing the secrecy of LLC ownership as an obstacle to
bringing violators into compliance.


This phenomenon of LLC ownership of residential properties has dramatically increased all
across the country, and while it is not rampant here in Clarkstown it does seem to be an
increasing trend in the county. Again, many LLC's are indeed responsible property owners and
if a home near you is bought by one, that isn’t necessarily a reason to be concerned. Whereas
in the past, an LLC had the ability to shield its owners, that is no longer the case here. This new
local law is part of our continuing efforts to maintain the integrity of our community by fairly
enforcing our codes and laws. We won’t tolerate anything less here in Clarkstown.