A Staten Island judge wrote ‘no crime is involved here’ as he canceled every notice NYC mailed out for Mamdani’s second-home tax

A Staten Island judge has canceled every notice New York City mailed out regarding its new pied-à-terre tax. Judge Wayne Ozzi, who serves on the state’s Supreme Court, issued the ruling on Tuesday in a lawsuit brought by homeowners over how the city rolled out the tax.

As reported by The Hill, the city initially published a list of more than 960,000 properties that could potentially be subject to the surcharge. It later clarified that only about 17,000 property owners received notices in the mail.

The number of properties that actually meet the statutory value thresholds is estimated to be far lower, potentially between 5,000 and 6,000. Plaintiffs argued the approach placed the burden on homeowners to prove they were exempt, rather than on the city to identify which properties qualified.

The judge was not impressed with the city’s rollout

Ozzi ruled that the Department of Finance violated homeowners’ due process rights through its method of determining who would pay the tax. “No crime is involved here,” he wrote, adding that homeowners were being substantially harmed and penalized needlessly by the department’s approach.

The judge also wrote that the notices “irresponsibly and unnecessarily caused homeowners to expend time and money.” He noted they failed to provide guidance on what proof was required to dispute the designation.

Under the order, the city must replace its current roll with a more limited one that includes only properties actually subject to the surcharge. All previously mailed notices are canceled, and the city cannot send new ones until it makes an individualized initial determination for each property.

Matt Rauschenbach, a spokesperson for Mayor Zohran Mamdani, called the ruling “wrong” and said the administration would invoke a stay of the injunction. He said the city would continue implementing the surcharge “fairly, efficiently and in full compliance with the law,” and argued that the ultra-wealthy are using the courts to avoid paying their fair share.

A source from the administration said the city planned to move for a stay as early as Tuesday evening. The ruling came in the same news cycle as a New York clip of an influencer confronted in West Village.

The lawsuit does not challenge the legality of the tax itself, which Mamdani and Governor Kathy Hochul proposed in April to help close the city’s budget deficit. According to Sheppard Mullin, it applies to one, two, and three family homes valued over $5 million, as well as condos and co-ops valued over $1 million, when the owner has a separate primary residence.

In August, Ozzi issued a temporary restraining order to pause the rollout, but the city appealed, which kept the process moving until this latest ruling. Randy Mastro, the lawyer representing the plaintiffs, had described the rollout as a “total screwup, totally botched, a debacle” when the lawsuit was filed.