September 25, 2013

The Need For Transparency

It is obvious that board members, be it town, village, planning, or zoning, must recuse themselves from voting on matters that they may have a stake in, either directly or indirectly.

Certainly, for example, a town board member would never vote to purchase property owned by a family member -- or would he (or she)?

We're not suggesting these types of things happen (though we're not ruling it out, either) but the way things are set up now we'll never know.

That's because individuals often hide behind the veil of corporations. Variances are granted, and property routinely purchased from LLCs without ever requiring the individuals behind those corporations to be identified. So how do we know someone isn't doing someone else a favor at the public's expense? The sad truth is, we don't.

A case in point is a recent transaction in East Hampton. A reader suggested we look into it – which is where the frustration comes in. In December of 2011 a small parcel of land in Amagansett sold for $340,000. Recently the town voted to purchase it for $585,000. That makes for a tidy little $245,000 profit in less than two years. We're not suggesting anything untoward occurred, but the owner is an LLC, which means we get little more than the name of an agent or lawyer when trying to find out who is behind the deal.

This happens in all five towns. Municipalities that truly want transparency should mandate that corporations doing business with them identify the individuals involved.

By the way, every time a town purchases property – including CPF purchases – lots of people get checks. Appraisers. Surveyors. Lawyers. Often times, real estate brokers. It's a cash cow for insiders who get the contracts. Perhaps there should be a cap on fees charged in connection with municipal purchases? Better still, if preserving what's left is so important to the community, shouldn't a lot of people getting rich from the process offer to reduce their fees or (gasp!) donate their time and services?

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