A Staten Island judge has ruled against the Mamdani administration’s rollout of New York City’s new pied-à-terre tax, ordering the city to withdraw and redo tax notices sent to thousands of homeowners.
The ruling came in a lawsuit brought by New York City homeowners represented by attorney Randy Mastro, a former deputy mayor under Mayor Eric Adams. The homeowners challenged the city’s process for identifying properties that could be subject to the new surcharge.
Judge Wayne Ozzi ruled that the city must issue new notices and disclose the records it used to determine that properties were not the owners’ primary residences. The ruling is pending a possible city appeal.
The city sent notices in July to approximately 17,000 property owners who could be affected by the tax. The Department of Finance had also compiled a list of nearly 1 million properties it considered when assessing which homes could potentially be subject to the surcharge. The city has since exempted about 4,000 of the homeowners who received notices.
Mastro said the administration improperly placed the burden on homeowners to prove that they live in their own homes.
“The fact is that this administration failed to follow state law,” Mastro said, arguing that homeowners should not have to prove their primary-residence status simply to avoid the new tax.
The pied-à-terre surcharge applies to certain high-value second homes, including properties valued at $5 million or more and qualifying condominiums and cooperatives. City officials estimate the tax could generate approximately $500 million annually.
The administration is defending the surcharge, saying it is intended to require wealthy owners of second homes to contribute toward city services.
The latest ruling adds another legal challenge to a tax that remains the subject of ongoing litigation.
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