A Staten Island judge issued a temporary restraining order this week on the Mamdani administration's pied-à-terre tax launch after a lawsuit by homeowners claimed that the city botched identifying who would fall under the new surcharge.
The city immediately filed to appeal the decision, which means a higher court will look at it before the order can go into effect.
The suit came after city residents began to receive letters notifying them that they may fall under the new tax, with reports showing that some homeowners were chosen despite not meeting its guidelines.
A tax roll was also published, which listed properties that may fall under the new rule, although the city said "the vast majority of properties and units listed in the roll will NOT
be subject to the surcharge."
The pied-à-terre tax plans to annually charge one-, two-, and three-family homes valued at more than $5 million and condominium and cooperative units valued at $1 million or more when owners have a separate primary residence outside of New York City — a measure that Mayor Zohran Mamdani had taken in efforts to tax richer residents.
"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," Matt Rauschenbach, a spokesperson for the mayor, said in a statement to USA TODAY.
"The Law Department will appeal the ruling immediately which will stay the order, and the City will continue with the pied-a-terre's implementation."
Those suing the city are represented by former First Deputy Mayor Randy Mastro, who served under former Mayor Eric Adams. Officials pointed to the lawyer's record when asked about the suit.
"There are few things more certain in New York City than death, taxes and Randy Mastro filing a lawsuit against this administration," Mamdani said when asked of the filing.
"So we look forward to vigorously defending our city's position in court as we have done so with the previous lawsuits that he has filed."
The city deadline gave around 17,000 residents who received the letters until Sept. 18 to prove that they do not meet the guidelines for the new tax. The next hearing for the case is expected Aug. 31.
This article originally appeared on USA TODAY: Mamdani team faces brief setback over pied-à-terre tax launch issues
