By Sabina Mollot
On Tuesday, three Democratic state legislators filed a lawsuit against the Board of Elections aimed at closing the “LLC Loophole.”
The so-called loophole, created by the board in 1996, came under scrutiny this year due to all the campaign cash that had been legally funneled to legislators through limited liability companies. Many of the LLCs were controlled by real estate interests, most infamously Leonard Litwin of Glenwood Management. The loophole has allowed them to give nearly limitless contributions — up to $60,800 in a single election year by allowing them to be considered individuals.
“It’s not just (Litwin),” said Brent Ferguson, an attorney with New York University’s Brennan Center for Justice, which helped prepare the lawsuit. “In the real estate industry, they can operate a separate LLC for every building they own.”
He added, “We think it’s an incorrect reading of the law.”
The Brennan Center got involved with a suit on the loophole, said Ferguson, because it’s “become very popular” in recent years. “The amount has skyrocketed.”