NYC Homeowners Score Temporary Court Victory Over Mamdani’s New Tax

New York City homeowners fighting a tax on second homes won a brief victory in court on Monday.

A state judge issued a temporary restraining order on Mayor Zohran Mamdani’s pied-à-terre tax that would halt implementation of the tax while a lawsuit against it is in the courts, according to WABC-TV.

The city responded quickly, filing an appeal that blocks the judge’s order from taking effect until the appeal of his order is resolved.

“Since leaving office, Mr. Mastro has already sued the city five times. We disagree with today’s ruling, but we are confident in both the pied-à-terre surcharge and the City’s ability to implement it fairly and effectively,” a Mamdani representative said.

“The Law Department will appeal the ruling immediately, which will stay the order, and the City will continue with the pied-à-terre’s implementation,” the representative said.

Mamdani has said he is fulfilling his mission to tax the rich.

“This pied-à-terre tax is specifically designed for the richest of the rich,” Mamdani said earlier this year.

The city has sent notices to 17,000 residents, telling them that they may be liable to pay the tax.

The notices were excoriated by state Supreme Court Judge Wayne Ozzi, who ruled on the Staten Island-based case, according to The New York Times.

“Sending out notices to 17,000 homeowners who might be subject to a surcharge doesn’t satisfy the intent of the legislation,” he said.

“Notices should state what the records show. They are a treasure trove of information,” he continued. “I can’t unring the bell, but I can stop any further notices going out.”

The next round in the court battle comes on Aug. 31.

Randy Mastro, a lawyer representing the plaintiffs, said Ozzi’s decision “vindicated the rights of hundreds of thousands of New York City homeowners who were subjected to a process they never should have been a part of in the first place.”

Stephen Louis, counsel to the Center for New York City and State Law at New York Law School, said he expects a fast ruling on the appeal.

“Any tax collection scheme can be pretty complicated,” Louis said. “To be told ‘Oh no, now you have to stop doing anything’ is a little extreme.”

Democratic New York Gov. Kathy Hochul, who supports the tax, put some distance between herself and its implementation, according to the New York Post.

“While this lawsuit about the administration of the tax is a matter for the city and the courts to work through, the Governor continues to believe that people who can afford a multimillion-dollar second home in New York City can afford to pay their fair ,” a Hochul representative said.

As noted by The New York Times, the tax applies to condos and co-ops that are used as second homes and have what the city has determined to be a market value of at least $1 million.

One, two, and three-family homes the city says are worth more than $5 million must also pay the tax.

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