Why Should Delaware Care?
There are a handful of towns that allow owners of LLCs and other artificial entities to vote in town elections, potentially swaying election outcomes compared to full-time residents.
A Delaware Superior Court judge ruled this week that when it comes to elections in the small coastal town of Fenwick Island, business entities like family trusts and limited liability companies are able to vote.
The 20-page ruling by Judge Craig Karsnitz, which has been picked up in the national media and drawn eyebrow-raising headlines, began with a philosophical meditation on what it means to be a “person,” but ultimately denied a challenge by the American Civil Liberties Union of Delaware that allowing such non-human entities to vote diminished the voting rights of human residents.
“Visions of faceless large corporations or even [2001: A Space Odyssey’s] HAL, controlling a small town are frightening and the stuff of science fiction. However, the plaintiff has not demonstrated that this policy violates the principle of one person/entity/one vote,” Karsnitz wrote.
In part, Karsnitz’s ruling leans heavily on the fact that the Delaware state legislature gave the business entities voting rights in amendments to Fenwick Island’s town charter in 2008. Because the state recognizes the rights of such entities in other matters of law, the judge concluded that lawmakers could extend voting rights to them as well.
The ruling may not be the end of the road, however, as the ACLU could appeal it to the state Supreme Court.
“Voting should be for the people — not corporations. We believe strongly that allowing corporations to vote in local elections harms our democracy and dilutes the voices of voters. Over the coming days, we will review the Court’s decision and determine our next steps,” Andrew Bernstein, the lead voting rights attorney for the ACLU who filed the case, said in a statement Thursday.
Conversely, Fenwick Island Mayor Natalie Magdeburger noted that the majority of properties in her town are owned by family or marital trusts.
“We firmly believe our voting system is just, fair and gives everyone a voice. As a town, we believe that a property owner who pays taxes and is subject to our ordinances should have a say in who represents them on our Town Council,” she said in a statement.
Aside from the court’s consideration, it’s also possible that the Delaware General Assembly intervenes in the scenario.
Commenting on the ruling, Rep. Eric Morrison (D-Bear) said Democrats may introduce legislation to reverse the voting rights of non-human entities.
“No one and no entity should be voting in any election except individual people. Full stop. Fortunately, we Democrats in Dover are introducing legislation to make things how they should be,” he wrote on Facebook.
When reached, he said that he was not writing such legislation, but that is was under consideration within the caucus.
When the General Assembly approved the voting rights nearly 20 years ago, it received near unanimous approval and was sponsored by State Sen. Gerald Hocker (R-Georgetown). Such charter amendments, if supported by the municipal officials, are rarely controversial and often approved with little debate.
What does the Fenwick law say?
Voting rights are not an idle provision for Fenwick Island, as nearly a quarter of votes cast in the last municipal election in 2024 – or 109 in total – were cast by owners of entities like family trusts or LLCs rather than full-time residents.
In beach communities, it is common for many homes to be owned by such entities as investment properties or second homes for part-time residents.
There are four other small Delaware towns – Henlopen Acres, Dagsboro, Bethel, and Dewey Beach – that allow for artificial entities to vote in municipal general elections, or elections that choose mayors or town councils. Others allow for such entities to participate in certain special elections.
Fenwick’s town charter provides that any artificial entity that owns property in the town as of March 1 prior to an annual municipal election can cast a ballot.
A person can only vote once in the town election, regardless of whether they cast a ballot as the owner of an artificial entity or as a town resident. That is different from the situation uncovered in Newark in 2019, when a single developer voted 31 times on behalf of his many LLCs in the city and led officials to ban the voting by artificial entities there.
However, there are no limits on the number of artificial non-human entities eligible to vote based on their ownership interest in any single property parcel nor is there a minimum share of a property required to register. That means if several LLCs jointly own a beach home in Fenwick Island, all of the owners can register to vote, regardless of how little a stake.
The ACLU, which noted that it has members in Fenwick who have participated in the elections there, argues that artificial entity voting could sway election outcomes.
The town’s 2024 election was a contest between four candidates running for three council seats, and the third-place candidate was only 55 votes ahead of the losing candidate.
“This means that the votes cast on behalf of non-human artificial entities could have determined the outcome of the election,” the ACLU wrote in its lawsuit.
In 2023, the town election was a contest between eight candidates running for four seats. Then the fourth-place finisher, who earned a town council seat, beat the fifth-place finisher by only 42 votes – a margin that the ACLU also believed could have been affected by non-resident voters.
