A New York judge has temporarily blocked Mayor Zohran Mamdani’s planned pied-à-terre tax rollout after a group of homeowners sued the city, arguing that officials improperly shifted the burden of proving a property’s primary-residence status onto taxpayers.
New York Supreme Court Judge Wayne Ozzi of Richmond County issued a temporary restraining order Monday prohibiting the city from publicly posting a Supplemental Roll containing the names, addresses and property values of hundreds of thousands of property owners.
The order also bars the city from imposing or collecting the new surcharge without first making individual determinations about whether a property is being used as a primary residence.
The ruling represents a significant legal setback for the Mamdani administration as it attempts to implement the new tax, which was designed to generate hundreds of millions of dollars in additional revenue for New York City.
Homeowners challenge how city is implementing tax
The lawsuit was filed Aug. 7 by a group of New York homeowners against the City of New York, Mamdani, the New York City Department of Finance and Finance Commissioner Richard Lee.
The plaintiffs are represented by former First Deputy Mayor Randy Mastro.
At the center of the dispute is a new state law titled “The City Surcharge on Property That Does Not Serve as a Primary Residence.”
Under the city’s implementation plan, officials publicly posted a Supplemental Roll and sent notices to approximately 17,000 residents warning that they could be subject to the surcharge unless they obtained an exemption.
The homeowners argue that the city is improperly requiring property owners to prove that their homes qualify for an exemption rather than first determining whether the properties are actually subject to the tax.
The complaint also challenges the city’s reliance on federal and state tax returns as part of its process for determining whether a property is someone’s primary residence.
Judge Ozzi’s TRO temporarily puts those procedures on hold.
Tax targets high-value non-primary residences
The pied-à-terre tax was included in New York City’s 2026-27 budget after the state Legislature approved the measure in May.
The surcharge was originally proposed by Gov. Kathy Hochul as a way to help address New York City’s budget needs and support Mamdani’s efforts to close the city’s budget gap.
The city announced in July that it would begin implementing the measure, which generally targets residential properties valued at more than $5 million that do not serve as their owners’ primary residences.
Officials estimate the surcharge could generate at least $500 million annually.
The administration has defended the tax as a way to raise what it describes as critical revenue for public services, including parks, schools and libraries.
Supporters and critics clash over tax
The measure has generated sharply divided reactions.
Critics argue the tax could place additional pressure on property owners and create uncertainty over how the city determines whether a residence qualifies as a primary home.
President Donald Trump criticized the measure Aug. 11, describing it on Truth Social as a “dangerous political ‘experiment’” that he said could damage New York City and the state.
Supporters, meanwhile, say the surcharge would require wealthier property owners who maintain expensive residences that are not their primary homes to contribute more toward the city’s public needs.
The Fiscal Policy Institute has called the measure an important step toward creating a tax system that better reflects New York City’s wealth while providing funding for investments in areas including housing, transit and the workforce.
City signals it will fight the ruling
The legal battle is not over.
Arguments over the city’s implementation of the surcharge are scheduled to come before the court Aug. 31. But the city has already moved to challenge Judge Ozzi’s order.
The defendants, represented by attorney Geoffrey E. Curfman, filed an Affirmation of Intention to File for Permission to Appeal. That filing triggered an automatic stay of the TRO.
The development means the legal dispute over the tax can continue while the city seeks permission to appeal the judge’s decision.
Mamdani has indicated that his administration intends to defend the surcharge aggressively.
“There are few things more certain in New York City than death, taxes, and Randy Mastro filing a lawsuit against this administration,” Mamdani said, adding that the city looks forward to “vigorously defend[ing] our city’s position.”
The Aug. 31 proceedings could therefore become an important next step in determining whether New York City can proceed with its current approach to identifying properties subject to the pied-à-terre surcharge.
For now, the case has placed the administration’s rollout under judicial scrutiny and raised a broader legal question over who bears responsibility for establishing whether a high-value New York residence is a primary home or a taxable secondary property.
