BENEFICIAL LANDOWNER TRANSPARENCY MODEL ORDINANCE FOR JERSEY CITY

BENEFICIAL LANDOWNER TRANSPARENCY MODEL ORDINANCE FOR JERSEY CITY

Title

AN ORDINANCE AMENDING CHAPTER 188 - HOUSING ACCOMMODATIONS AND AFFORDABLE HOUSING COMPLIANCE, OF THE REVISED GENERAL ORDINANCES OF THE CITY OF JERSEY CITY, NEW JERSEY, BY ADDING A NEW SECTION TO REQUIRE LIMITED LIABILITY CORPORATIONS SELLING AND BUYING 1- TO 4-DWELLING UNIT RESIDENCES TO RECORD BENEFICIAL OWNERSHIP INFORMATION WITH DEED OR TRANSFER OF TITLE.

Preamble

WHEREAS, the City of Jersey City seeks to ensure the health, safety, and welfare of its citizens by maintaining high standards in the maintenance and management of residential properties; and

WHEREAS, increasing investment and development in Jersey City have raised concerns about rising housing costs, potential displacement of low and moderate-income residents, and transparency in property ownership; and

WHEREAS, the City recognizes the need for enhanced transparency in real estate transactions involving limited liability corporations (LLCs) to combat abusive practices by corporate buyers and to promote a balanced real estate market; and

WHEREAS, LLC ownership of residential properties can obscure the identities of the actual owners, complicating efforts to regulate and enforce local housing and safety codes; and

WHEREAS, it is imperative to uphold the public interest by requiring disclosure of beneficial ownership of residential properties to prevent practices that can undermine the character and stability of residential neighborhoods;

NOW, THEREFORE, BE IT ORDAINED BY THE MUNICIPAL COUNCIL OF THE CITY OF JERSEY CITY, NEW JERSEY, THAT:

Section 1: The preamble of this ordinance is hereby incorporated by reference and made a part of this ordinance.

Section 2: Chapter 188, Housing Accommodations and Affordable Housing Compliance, is amended to add the following new section entitled "LLC Public Disclosure":

188-XX LLC PUBLIC DISCLOSURE

188-XX-1 Definitions

Residential Property means any real property within the City of Jersey City, whether single or multi-family, used for residential purposes.

Grantee includes every person or legal entity to whom an estate or interest in residential property passes, in or by a deed.

Grantor includes every person or legal entity from whom an estate or interest in residential property passes, in or by a deed.

Beneficial Owner means a natural person who, directly or indirectly, holds a significant interest in or substantially controls an LLC involved in real estate transactions within Jersey City. Further details on what constitutes a Beneficial Owner are specified in the attached schedules.

188-XX-2 Requirements of Limited Liability Company Disclosure; Exemptions

Effective immediately, all LLCs participating in the buying or selling of 1- to 4-unit residential properties must accompany any deed or title transfer with a disclosure document ("LLC Disclosure Form") that identifies all beneficial owners.

This form must be filed with the Hudson County Register of Deeds and Mortgages and include full legal names, contact information, and the nature of each beneficial owner’s interest in the LLC.

Disclosure requirements extend to any legal entity that is a member, manager, or beneficial owner of the LLC, ensuring transparency up to the ultimate natural persons.

188-XX-3 Enforcement; Retroactive Application

No Certification of Occupancy (CO) or Certificate of Code Compliance (CCC) will be issued for any property transferred under this section without a completed LLC Disclosure Form.

The form and its details must be verified and approved by the Department of Housing, Economic Development, or their designee.

Section 3: If any part of this Ordinance is declared invalid, the remaining parts shall remain in effect.

Section 4: This Ordinance shall take effect immediately upon passage and publication as required by law.

STATEMENT

This Ordinance amends Chapter 188 of the Jersey City Code to require all LLCs buying or selling 1 to 4 unit residences in Jersey City to disclose beneficial ownership information. This measure aims to enhance transparency in property transactions and support the city's efforts to maintain affordable and safe housing.