RESOLVING THE LEDGER
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See the full story · 3 sourcesCity Council is holding a public hearing Tuesday about Mayor Zohran Mamdani's rollout of a new tax on luxury second homes. cmart7327/Getty Images
NYC City Council is holding a meeting on Tuesday over the pied-à-terre tax rollout.
Mayor Zohran Mamdani's team submitted testimony explaining how they've started informing homeowners.
A lawsuit over the Department of Finance property records release is ongoing.
New York City homeowners say they're confused by Mayor Zohran Mamdani's rollout of the pied-à-terre tax — and they're joining City Council on Tuesday to testify.
The Mayor's Office opted to forgo an in-person appearance at the hearing, instead submitting a written memo. In a copy obtained by Business Insider, Mamdani's team said their release of home values and addresses ahead of the levy is standard, with Department of Finance Commissioner Richard Lee writing that the information is "highly accessible to the public, and it has been for many years. Any suggestion to the contrary is incorrect."
The levy on luxury second homes sparked a public uproar in late July after the NYC Department of Finance sent letters to 17,000 addresses that could potentially be a pied-à-terre based on property value and internal records. The DOF also published a list of over 900,000 properties and their valuations across the city.
In the Tuesday testimony, Lee continued that "the supplemental roll does not establish which properties are subject to the surcharge," and is intended to provide "a basis for property owners to challenge the value of their properties." Residents have until September 18 — an extended deadline — to prove their property doesn't qualify for the tax before it starts showing up on bills in 2027.
On social media, some New Yorkers said that they mistakenly received a letter for their primary residence, while others felt their privacy was violated during the DOF records release.
Council Member Gail Brewer, who represents Manhattan's Upper West Side, told Business Insider that her office has been "bombarded" by concerned constituents in recent weeks. Brewer said that she and other council members complied "pages and pages" of questions about the pied-à-terre rollout they hope the Mayor's Office will address.
A lawsuit — filed by three residents based in Manhattan and Staten Island — is also pending, with a court date scheduled for August 31. The plaintiffs are seeking "emergency relief" after the records release that court documents allege "caused mass confusion" and "facilitated, invited, and amplified unwanted scrutiny of homeowners' personal information."
Their attorney, Randy Mastro, said hundreds of thousands of New York City homeowners were "subjected to a process they never should have been a part of in the first place."
The city said it has hired two dozen staffers to answer resident questions about the tax and assist with appeals. Passed in May, the policy will impose a progressive levy on non-primary homes valued by the DOF at least $5 million and condos and co-ops valued at least $1 million.
Deputy Press Secretary Matt Rauschenbach told Business Insider last week that "the Law Department is prepared to vigorously defend the city against this suit" and the money raised by the levy will "help deliver the city New Yorkers deserve: cleaner parks, safer streets, and critical public investments that make our city a more affordable place," to the tune of $500 million a year.
Lee said in his testimony that he is submitting only written material due to the ongoing litigation and will be available to testify after the lawsuit is settled.
Read the full memo:
Chair Gale Brewer, Chair Linda Lee, and Members of the City Council, My name is Richard Lee, and I am the Commissioner of the New York City Department of Finance (DOF). Thank you for the opportunity to submit testimony regarding the implementation of the surcharge on non-primary residence properties, commonly referred to as a "pied-a-terre." I understand the Council's interest in holding this hearing to discuss the implementation of this surcharge. The public understandably has a range of questions about this surcharge and the manner in which it has been implemented. I have been engaged with members of your team, and directly with many of you, to ensure that New Yorkers have the information that they need. I would have welcomed the opportunity to appear in person and field your questions directly, but the pending and active litigation precludes me from doing so. The Administration requested that the City Council postpone the hearing to the near future but the Council declined. In the meantime, I appreciate the opportunity to address some of those questions in my written testimony. First, let me walk through the steps that led to implementation of the surcharge — from the passage of the state legislation authorizing the surcharge, through the rule-making process, to the posting of a supplemental roll and transmission of initial determination letters. On May 28, 2026, as part of the State's 2026/2027 budget legislation, the State enacted part HH of chapter 59 of 2026, which authorized this surcharge on certain high-value New York City residential properties that are not used as a primary residence. The law was enacted with support from the Mayor and his Administration to help close a significant budget gap. The statutory provisions relating to this surcharge can be found in Article 30-C of the New York State Tax Law and Chapter 32 of Title 11 of the City's Administrative Code. As with all revenue collected by DOF, these funds help keep the City running. The revenue DOF collects supports essential services that New Yorkers rely on every day, from educating our children in public schools and maintaining our parks to ensuring our streets are clean and our trash is collected. DOF took steps to ensure the surcharge would be implemented through a transparent, consistent, and fair process that is legally compliant. On June 9,...
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