Judge temporarily blocks rollout of Mamdani’s pied-à-terre tax

By Katherine Koretski, CNN

(CNN) — A Staten Island judge on Monday temporarily blocked New York City’s rollout of Mayor Zohran Mamdani’s pied-à-terre tax, pausing enforcement while a lawsuit brought by a group of homeowners moves forward.

Under the temporary restraining order, the city must take down the public tax roll and is barred from issuing any additional notices while the order is in effect. The next hearing is set for 2:15 p.m. August 31.

The judge said from the bench that the notices caused irreparable harm because they did not explain why recipients had been flagged for the surcharge and warned that homeowners who failed to file for an exemption would be subject to the tax.

The ruling came hours after Mamdani, at a Monday morning news conference, vowed to “vigorously defend” the city’s position in court.

The pied-à-terre tax places a surcharge on non-primary residences in New York City valued at least $5 million and on condominiums and co-ops valued at $1 million or more. It was enacted as part of the state budget and signed into law in May in an effort to close the city’s budget gap. Gov. Kathy Hochul announced the proposal alongside Mamdani in April and signed it into law.

The lawsuit, filed Friday in state Supreme Court, Richmond County, was brought by three homeowners — Simon Hedley, Rachel O’Brien and Carmine Morano — who allege the city incorrectly identified their homes as potentially subject to the surcharge despite the properties serving as their primary residences, according to a news release.

The suit does not challenge the legality of the tax itself but scrutinizes the city’s release of a tax roll that included the names, and addresses and property values of more than 900,000 New York City residential properties — including those not subject to the tax — as well as notices sent to some residents. About 17,000 property owners received letters alerting them that they may be subject to the surcharge.

This is a developing story and will be updated.

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