Newark asks state to eliminate LLC voting rights from city charter

Newark Post | by Josh Shannon

Newark is one step closer to eliminating a provision in the city’s charter that allowed a developer to vote 31 times in last year’s referendum.

City council on Monday voted unanimously to ask the state legislature to amend Newark’s charter to change the voting requirements for a referendum.

The controversy traces back to the June 19 referendum in which voters gave the city permission to borrow $27.6 million for the Rodney stormwater pond/park and other capital projects.

In Newark’s first referendum since 2001, the vote brought to light a little-known provision of Newark’s charter, which opens referendum voting to a broader constituency than other elections.

The law gives referendum voting rights to not just city residents, but also non-resident property owners as well as corporations and limited liability companies that own property in the city.

The law allows one vote per entity, not per property, meaning that a company that owns multiple properties only gets one vote. However, a person who represents multiple companies or LLCs can cast multiple votes, one for each entity. For legal liability reasons, housing developers often create a different LLC for each project they build, meaning those developers have the opportunity to cast multiple votes.

More than a dozen people cast multiple ballots in June. Chris Locke, senior vice president and general counsel for Lang Development Group, cast the most votes at 31. Developer Hal Prettyman cast 10, with other representatives of his companies casting another three. Developer Kevin Heitzenroder cast nine, a representative of Tsionas Management cast eight, developer Todd Ladutko cast eight and developer Kevin Mayhew cast five.

While LLC voting didn’t affect the results of the vote – the four questions all passed by wide margins – it drew strong criticism from open government advocates and some members of council.

“Entity voting adds to corporate influence by diluting the votes of registered voters,” Nick Wasileski, president of the Delaware Coalition for Open Government and a Newark resident, said Monday night. “Newark has an opportunity to not only prohibit entity voting but also enforce the principal of one person, one vote.”

The proposed charter change takes away the ability of corporations and LLCs to vote in a referendum and dictates than an individual may only cast one ballot.

Notably, though, it retains the provision that allows non-resident property owners to vote.

Amy Roe, another critic of LLC voting, pointed out that the way the proposal is written, a child or foreign national who owns property in Newark could vote in a referendum. She suggested the city limit eligibility to Newark residents who are registered to vote in normal elections.

Council members seemed amenable to Roe’s suggestion but decided to move forward with the current proposal while they research the legality of it.

“We’ll move forward as it is and fix it later,” Councilman Mark Morehead said.

The charter change now goes to the state legislature for approval. State Rep. John Kowalko personally guaranteed that it would pass.

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