Mamdani Admin Skips Pied-à-Terre Tax Hearing

Lawmakers, homeowners and even supporters of the pied-à-terre tax had choice words for the Mamdani administration over the rollout of its controversial second-home surcharge.

But nobody from the mayor’s Department of Finance attended the Tuesday oversight hearing held jointly by the City Council Finance Committee and Committee on Governmental Operations, State & Federal Legislation.

The DOF’s written testimony, offered in lieu of Commissioner Richard Lee appearing to testify in person, acknowledged the outpouring of questions after the administration sent 17,000 initial notices to possibly eligible homeowners, which will then be whittled down even further. A mayoral spokesperson attributed the administration’s lack of attendance to concurrent litigation challenging the release of more than 900,000 names on a supplemental tax roll.

“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,” Commissioner Lee wrote in his testimony. “The Administration requested the City Council postpone the hearing to the near future but the Council declined.”

Mamdani’s DOF is pressing on with its rollout of the tax — which targets single-family homes valued at $5 million or more and condos and co-ops valued at at least $1 million that are deemed non-primary residences — with an extended deadline of Sept. 18 for homeowners to apply for an exemption, after a court affirmed that a temporary restraining order must be stayed pending the administration’s appeal. DOF Commissioner Lee noted that he would be prepared to testify after Aug. 31, when the parties are scheduled to appear in court.

The administration’s testimony highlighted that information published in the initial broad list is publicly available and has been published in annual assessment rolls for more than a century. Even so, the word “botched” came up frequently in lawmakers’ remarks and public testimony.

“I do want to begin by talking about who’s not here today, which obviously is the administration. Frankly, I find that outrageous.” Council member Frank Morano, whose wife and father are plaintiffs in the lawsuit, said. “Litigation is not a hall pass from legislative oversight. The more New Yorkers and the more this Council learned about this whole process, the more clear it was how rotten it was, how bungled it was and the more questions we had.”

Morano and other lawmakers cited instances where past administrations have sent agency officials to testify before Council oversight panels about sensitive topics while legal matters were pending. Finance Committee Chair Linda Lee took a different tone, nodding to the sensitivity of testifying while a matter is before a court. Committee on Governmental Operations, State

& Federal Legislation Chair Gale Brewer insisted that the committee would be sending their questions and expecting thorough answers, despite the administration’s lack of in-person attendance before the joint committee.

More than a dozen public commenters — from brokers to co-op owners and advocates for taxing the rich — offered a wide swath of perspectives, but many agreed that the Mamdani administration’s new tax debut created a mess for implementation.

“This administration is putting homeowners on the hot seat,” Jason Haber, co-founder of the American Real Estate Association and Compass agent, said. “What they’re saying is, ‘we know who you are, we know how much your apartment is worth, it’s all up in the air, there’s going to be taxes in the future.’”

Advocates for taxing the rich, who rallied in City Hall Park ahead of the hearing, view the second home surcharge as a way to fund public programs, with commenters at the hearing citing education and childcare as priorities that pied-à-terre owners should contribute to via the tax.

“We who live, work and pay taxes here year round make this city a desirable place to have a second home,” public commenter and Manhattan resident Beverly Solow said. “It seems reasonable and fair to ask those who don’t pay full-time income taxes here, but who have luxury homes here for pleasure, to contribute to the well-being of New York City, its families and its students.”

Brewer noted that some, but not all, lawmakers agree with the ideas underpinning the tax, but began to take issue when the rubber met the road.

“Many of us, the Speaker, the co-chairs and many of the members support this tax,” Brewer said, having noted that her own property appeared on the initial supplemental PAT tax roll. “It’s the implementation that has some challenges.”

Other lawmakers including Council members Phil Wong and Mercedes Narcisse highlighted complexities primary residents in their districts have faced when attempting to prove they live in their homes full-time. When asked by one public commenter what the Council could ultimately do to push back on the tax rollout, Brewer thanked him for providing “ammunition” with his testimony to question the administration on its implementation of the surcharge, tacitly admitting the limitations on the City Council’s power to control the rollout itself.

Most members of the Council subcommittee and virtually all spectators had cleared out by the time Co-Chairs Brewer and Lee got around to their laundry list of questions for the Mamdani administration, which they posed to a set of empty chairs after hours of public testimony. Their questions echoed those raised by many commenters, including issues with the process of submitting for an exemption online. They also requested a sample of the DOF notices that had been sent to upwards of 17,000 property owners who may be subject to the new tax.

“Oversight is an incredibly important function that the City Council performs,” Council Speaker Julie Menin told The Real Deal. “Having worked in numerous administrations as commissioner, I have routinely seen that city agencies still testify despite ongoing litigation. So the choice not to be here because of that, I don’t agree with and I think it’s unfortunate.”