Judge halts rollout of New York's pied-à-terre tax pending homeowners lawsuit

A Staten Island judge on Monday issued a temporary restraining order that pauses the city’s pied-à-terre tax, a surcharge on high-value second homes, pending a lawsuit filed by three homeowners. The order requires the city to remove the public tax roll and prohibits it from issuing further notices until a hearing scheduled for Aug. 31.

The plaintiffs, Simon Hedley, Rachel O’Brien and Carmine Morano, allege the city mistakenly flagged their primary residences as subject to the tax, which applies to non-primary homes valued at $5 million or more and to condos and co-ops valued at $1 million or more. The suit does not contest the tax’s legality but challenges the city’s release of a tax roll that listed names, addresses and values of more than 900,000 properties, many of which are not liable for the surcharge.

"We are very gratified by the judge’s decision, which has 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," said Randy Mastro, the plaintiffs’ attorney.

Mayor Zohran Mamdani, speaking at a news conference, said the city will "vigorously defend" its position in court. The tax, enacted as part of the state budget and signed into law in May, was promoted by Governor Kathy Hochul as a measure to address the city’s budget gap.