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New York City Mayor Zohran Mamdani on Tuesday quickly appealed a judge’s decision to cancel previously mailed notices for his second-home tax, triggering an automatic stay of the ruling.
“The auto stay allows the city to continue, as we have been, with the implementation of the pied-a-terre surcharge and puts the lower court’s order on pause,” a city official said.
Just hours earlier, Judge Wayne Ozzi found that the city failed to follow required procedures before mailing the notices, which he described as “arbitrary and capricious, affected by errors of law, and in violation of the recipients’ due process rights,” according to the ruling.
Despite the ruling, Ozzi noted that the policy itself could still survive. He said the city can still apply the tax by removing the current list of taxed properties from its website and posting a corrected list after following the proper procedures.
MAMDANI’S LUXURY-HOME TAX ROLLOUT DERAILED FOR NOW AS JUDGE DELIVERS WIN TO NYC HOMEOWNERS OVER MASSIVE LIST
New notices must then be mailed in compliance with the law.
Tuesday’s decision served as a legal speed bump for Mamdani as he approaches nearly a year since he was elected New York City mayor and is among a handful of other legal challenges he faces as he attempts to implement government-first approaches to promises to bring down costs of living, expand housing and increase public transportation.
In addition to his second-home tax, Mamdani has also faced legal pushback on his rent freeze plan, which landlords have characterized as overly punitive, his state-sponsored grocery store plan, which has sparked challenges from the National Supermarket Association and what they see as unfair competition and challenges to specialized high school admissions that some parents believe unfairly discriminates against Asian-American enrollees.
Mamdani announced the second-home tax back in April.
In its original form, it was designed to levy an annual surcharge on one to three family homes, condominiums and co-ops valued at above $5 million. It also only applied to owners who also had additional property outside of New York City.
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“Thanks to the support of Governor Hochul, we are one step closer to balancing our budget by taxing the ultra-wealthy and global elites with a pied-à-terre tax — the first of its kind in our state. Alongside the governor, our administration is fighting every day to make sure we address this fiscal deficit fairly, where the wealthy contribute what they owe and our budget reflects our commitment to the working New Yorkers being priced out of our city,” Mamdani said in a press release at the time.
Asked about the plan after Tuesday’s decision, representatives for Mamdani said the mayor would stand by his plan.
Matt Rauschenbach, a spokesperson for the mayor, defended the tax rollout, arguing that the pied-à-terre surcharge is a “basic principle of fairness” that supports a city he said should not be a “tax haven for the wealthy few.”
“If you can afford a luxury second home in New York City, you can afford to pay your fair share for the schools, streets and parks that make this city work,” Rauschenbach said.
“Our administration is fighting every day to deliver for working New Yorkers. The ultra-wealthy are fighting in court to avoid paying their fair share. They have filed lawsuit after lawsuit to protect their privilege, and we will not back down.
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“Today’s decision is wrong, and we will invoke a stay of the injunction. With a stay, we will continue implementing the surcharge fairly, efficiently and in full compliance with the law, as we have since day one.”
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