NEW YORK CITY — Staten Island Supreme Court Justice Wayne Ozzi issued a temporary restraining order on August 11, 2026, blocking New York City’s implementation of the pied-à-terre tax. The ruling halts the city's enforcement efforts and mandates the immediate removal of approximately 900,000 property records from the Department of Finance website.

The court order prohibits the city from taking further action on the 17,000 notices sent by the Department of Finance to homeowners regarding the tax. Judge Ozzi ruled that the city’s mailed notices did not constitute proper notice under tax law and annulled them. He stated that no law permitted or required the city to publish a list of names, addresses, and property values of more than 900,000 homeowners.

The temporary restraining order remains in effect until at least August 31, 2026, when a court hearing is scheduled. This legal intervention follows a lawsuit filed on August 7, 2026, by three homeowners: Rachel O’Brien, Carmine Morano, and Simon Hedley. The lawsuit argues that the city’s rollout caused mass confusion and unfairly placed the burden on homeowners to prove their primary residence status.

Rachel O’Brien and Carmine Morano are residents of Staten Island who had their homes listed on the published tax roll. Carmine Morano is the father of City Councilman Frank Morano. Simon Hedley is a resident of Chelsea who received one of the 17,000 mailed notices regarding the tax. The litigation was represented by attorney Randy Mastro, who previously served as first deputy mayor under Eric Adams.

Mayor Zohran Mamdani defended the database as the city's complete property roll required under state law rather than a list targeting taxpayers. At a press conference, he stated that he believes the city will prevail in the legal challenge. "And that is a confidence coming from both the legality of the City's actions as well as the importance of a surcharge on secondary homes worth more than $5 million, a surcharge that will help fund safer streets, that will help fund stronger schools, and it will help fund the city that New Yorkers deserve," Mamdani said.

Mamdani joked that there are few things more certain in New York City than death, taxes, and Randy Mastro filing a lawsuit against his administration. Matt Rauschenbach, a spokesman for Mayor Mamdani, stated that the Law Department will appeal the ruling immediately. "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," Rauschenbach said.

Rauschenbach stated that since leaving office, Randy Mastro has sued the city five times. He added that the surcharge asks those who own second homes valued at $5 million or more to contribute their fair share to the city. Prior to the ruling, the city had received 3,801 submissions challenging the Department of Finance’s initial determination as to primary residence.

A spokesperson for Governor Hochul stated that the governor believes people who can afford a multimillion-dollar second home in New York City can afford to pay their fair share. New York Governor Kathy Hochul's office had previously warned that the pied-à-terre tax exemption process could expose residents who falsely claimed nonresident status to avoid paying New York state taxes.

The pied-à-terre tax applies to one- to three-family homes worth at least $5 million and co-ops and condominiums valued at $1 million or more that are unoccupied, non-primary residences. The tax rate tops out at 1.3% of a single-family home’s value when it is worth over $25 million. For condos and co-ops, the rate tops out at 6.5% of the value when the property is worth over $5 million. The tax is expected to raise roughly $500 million in revenue for the city.

State lawmakers and Governor Kathy Hochul approved the tax in the spring of 2026. The tax is expected to be paid on June tax bills in 2027. The ruling shows the tension between municipal revenue generation and homeowner privacy rights, with the court finding the public disclosure of nearly a million records lacked legal authority. The city must now adjust its notification process to satisfy proper notice requirements under tax law before proceeding with the levy.

Why It Matters

The ruling halts a tax projected to generate $500 million for city services like schools and streets while the administration prepares an immediate appeal. By annulling notices sent to 17,000 homeowners and ordering the removal of 900,000 property records, the decision shifts the burden of proving residence status away from owners during the legal challenge. This intervention delays revenue collection scheduled for 2027 and tests the city's ability to enforce the surcharge on high-value secondary homes.