Implementation of the Pied-à-Terre Tax

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Good afternoon and welcome to the New York City Council hearing on the Committee on Governmental Operations, State & Federal Legislation, joint with Finance. At this time, please silence all electronics and do not approach the dais. If you are planning on testifying, please ensure you fill out a testimony slip with the sergeants at the back, or you may do so online at testimony.council.nyc.gov. Thank you for your cooperation. Chairs, you may begin.

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Thank you very much. I am Gale Brewer, the Chair of the Committee on Governmental Operations, State & Federal Legislation. I want to thank all the members of the public who have joined us today as well as colleagues, and the indomitable, fabulous Chair of Finance.

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CM Linda Lee, CM Morano. I think we also have CM Paladino.

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Today is a very strange sort of hearing, but we will conduct oversight of the rollout of the Pied-à-Terre Tax. The most recent state budget included a surcharge on property that does not serve as a primary residence, but it is more commonly referred to as the Pied-à-Terre Tax. There has been a lot of confusion around the City's rollout of the Pied-à-Terre Tax.

First, the Department of Finance published on its website a list of around 900,000 residents that it said could potentially be subject to the tax, even though the Comptroller estimated that less than 14,000 properties would be subject to the tax. No estimate of the number of pied-à-terres in the City comes even close to 900,000. Yet the City still published the list with the small caveat that the properties on the list may be subject to the charge.

The list published by the Department of Finance was so overbroad that it even included my name and my home address. But I have been in that home for 365 days a year since 1994. I do not leave the City and I do not have a second home. We want to know today how all those names ended up on the list and why the Department of Finance published a list of property owners when, admittedly, they knew that the vast majority of the properties on the list were not, in fact, used as pied-à-terres.

Finance ultimately only sent notifications to around 17,000 property owners notifying them that they would be subject to the tax. That number is still larger than most estimates. My office and other Council members have received calls from constituents who received these letters, even though the property listed is their primary residence and has been for many years.

Homeowners who believe that they received the letters in error initially had only a short window to contest the surcharge, although the deadline was ultimately extended by four weeks. This still puts a burden on property owners and has upset people tremendously. They have to prove to the City that the property in question is their primary residence, rather than, as I said, the onus being on the City to ensure that only properties being used as pied-à-terres are subject to the tax.

The City already has plenty of records showing which taxpayers are City residents. For example, the co-op and condo abatement already requires that property owners submit documentation showing that the units are owner-occupied, so the City should already know that these units are not pied-à-terres. The City should have used the information it already had before publishing people's names and addresses and requiring them to affirmatively prove again that they reside in the City.

Not only does this create a burden for taxpaying New Yorkers, but now Finance needs to spend time and resources processing every application for an abatement and collecting and verifying documentation it has already collected — in my opinion, wasting public resources. So far, nearly 42,000 property owners have applied for or are in the process of applying for an exemption to the tax, because either they are using the property as a primary residence or because they are eligible for some other exemption.

Both the Mayor and Finance Commissioner, for whom we have great respect, have already acknowledged that the records they were using to identify property subject to the tax were outdated and that they knew when they posted the initial list that it included a large number of properties that would not be subject to the tax. I think we all want to know why the City published a list that it knew was not accurate.

Like many of my constituents, I have a lot of questions about this tax that we were hoping to get answers to. I do want to thank the Council staff members who made this possible: from the Governmental Operations Committee, Joe Harry Frazier, Erica Cohen and Sigma Hamid; and from the Finance Committee, Brian Sorrow, Owen Gutowski and Cynthia Hornig from my office, and everybody else.

I do also want to say that I thank the Department of Finance because they have been helpful for those constituents who need help. I do not want people to think that has not happened, because it has. Now I am going to turn to the wonderful Chair, Linda Lee. Thank you so much.

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Thank you, Chair Brewer. Good afternoon, everyone. Welcome to today's oversight hearing on the implementation and rollout of the City's Pied-à-Terre Tax, also known as the non-primary residence property surcharge. The Pied-à-Terre Tax was enacted as part of the State's fiscal year 2026-27 budget and took effect on July 1, 2026. The surcharge applies to one-, two- and three-family homes valued at five million dollars or more, as well as condominium and cooperative units valued at one million dollars or more that do not serve as the owner's primary residence. Properties that serve as the primary residence of the owner, an immediate family member or a qualifying tenant are not subject to the surcharge.

Since implementation began, the Department of Finance has mailed notices to approximately 17,000 property owners identified as potentially subject to the surcharge and has published a supplemental roll listing more than 900,000 properties that may fall within the tax's scope. Given the scale of this rollout and the number of New Yorkers who have been affected, it is crucial that this Council conduct oversight of how the administration is planning on implementing this new tax.

Following litigation initiated by a group of City homeowners, the administration extended the deadline for property owners to file exemptions from late August to September 18. Still, even with the extension, we seek greater guidance for those impacted to ensure that this rollout is smooth. Given this ongoing litigation, I want to note again for the record that the administration will not be participating in today's hearing. We understand the sensitivity of testifying while this matter is before the courts and we look forward to continued engagement with the administration once the litigation is resolved and to providing answers to City homeowners directly impacted by the rollout of the tax.

In the meantime, today's hearing will afford us an opportunity to hear from advocates, affected property owners and other stakeholders about the impact of this rollout to date and how to ensure that the Department of Finance's implementation of the surcharge is fair, transparent and legally sound going forward. We intend to send the administration written questions for follow-up in response to testimony shared by the public and questions prepared by myself and my colleagues. I want to thank all the staff who helped make this hearing possible, especially the Council's Committee on Finance and Committee on Governmental Operations. Chair Brewer, thank you.

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Very much, Chair Lee. What will happen now is I am going to read the testimony from the Finance Department. They are not here. Then we will hear from the constituents, as you heard, and then Chair Lee and I will read the questions that we

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would have asked, but we will be sending for answers to every single one of them. Can you acknowledge... Go ahead. Sorry, CM Dinowitz is here. Thank you. And CM Feliz and CM Maloney.

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Dear Gale Brewer, Chair Linda Lee, members of the City Council. My name is Richard Lee and I am the Commissioner of the New York City Department of Finance. Thank you for the opportunity to submit testimony regarding the implementation of the surcharge on non-primary resident properties, commonly referred to as the Pied-à-Terre Tax.

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, absolutely, 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 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 and the rulemaking process to the posting of a supplemental roll and transmission of initial determination letters. On May 28, 2026, as part of the State's 2026-27 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 the surcharge can be found in Article 30-D of the New York State Tax Law and Chapter 32 of the City's Administrative Code. As with all revenue collected by the Department of Finance, these funds help keep the City running. The revenue the Department 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.

The Department of Finance took steps to ensure the surcharge would be implemented through a transparent, consistent and fair process that is legally compliant. On June 9, 2026, the Department of Finance published proposed rules outlining how the new surcharge would be administered and applied. As part of the rulemaking process, property owners and other members of the public had an opportunity to submit written feedback, provide testimony and raise questions or concerns at a public hearing held on July 9, 2026.

The Department of Finance reviewed the feedback that it received through the notice and comment process, made appropriate adjustments to the rule text and promulgated the final rules necessary to implement the surcharge. These rules were adopted on July 14, 2026 and took effect immediately. After adopting these rules, the Department of Finance moved forward with implementing the surcharge and, as required by law, published a supplemental roll on its website.

Each year, the City publishes real property market values and assessed values for all taxable property through its annual assessment roll. The purpose of the assessment roll is to provide the public with notice about every property subject to real property taxation throughout the five boroughs, the assessed and market values associated with such property and certain information necessary to identify the property and its ownership. Both the Real Property Tax Law and the City Charter require the City to publish an assessment roll of taxable property in this manner. Assessment rolls have been required to be published annually for well over a century.

In accordance with the City Charter, Finance publishes a tentative assessment roll for the upcoming fiscal year every January — January 15, to be exact. Apart from publication of this tentative assessment roll, property owners may challenge certain assessment-related matters, including by making a filing with the City's independent Tax Commission. On the date the Tax Commission is required to render final determinations on these challenges — May 25 of each year — Finance releases its final assessment roll.

The City's assessment roll is highly accessible to the public and has been for many years. Any suggestion to the contrary is incorrect. For example, this property data has been publicly available as a fully searchable database on both the Finance website and New York City Open Data. Finance's online archives include assessment roll data dating back to fiscal year 2009. Many data elements included on the roll relating to property ownership are culled from land records and have also been available through the Department of Finance's City Register Information System, known to all of us as ACRIS.

The City has published assessment rolls and made them available for public examination in various forms for over a hundred years. Before internet accessibility, the City's assessment rolls and land records were made available for review in person at offices. Section 11-3100 of the Administrative Code, part of the statutory framework governing the surcharge, requires the City to administer and enforce a surcharge "to the greatest extent practicable in the same manner used to administer and enforce real property taxes" and requires the publication of corresponding property valuation information on a roll.

The law authorizing the surcharge was adopted after the assessment roll for fiscal year 2026-27 had already been published. As a result, the law governing the surcharge required the City to release a supplemental mid-cycle roll for the 2026-27 tax year in order for the surcharge to be administered. Stated differently, for the 2026-27 fiscal year only, Finance published a new assessment roll midyear: the July 2026 supplemental roll. This largely involved republishing data from the May 2026 final assessment roll.

Finance published the required supplemental roll on July 24, 2026. This supplemental roll includes relevant property valuation information and certain descriptive information regarding all property that meets the surcharge statute's definition of "covered property." The universe of properties considered covered property for purposes of the law is much broader than the properties that were sent initial determination letters, as explained below, or that will eventually be subject to the surcharge.

In light of this, it is important to emphasize what the supplemental roll does not do. The supplemental roll does not establish which properties are subject to the surcharge. It generally includes certain information to identify such properties and their ownership. Like the assessment roll, publication of the supplemental roll provides a basis for property owners to challenge the value of their properties. The law also requires Finance to send initial determination letters to property owners whose properties may be subject to the surcharge and whose primary residency could not be confirmed based on the information available to the agency. As described in Finance's rules, only a very small subset of the population of properties that were listed in the supplemental roll received an initial determination letter.

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About 17,000 homes out of an approximate total of 960,000 listed homes. The surcharge only applies to those Class 1 properties, which typically include one, two and three family homes with market values greater than or equal to $5 million, and cooperative and condominium dwelling units with market values greater than or equal to $1 million.

Some properties that would have otherwise received an initial determination letter did not receive one because Finance already possessed data that sufficiently demonstrated that the property was used as a primary residence and was therefore not subject to the surcharge. For example, homeowners who affirmatively established primary residency with Finance already for the 2026-27 fiscal year, such as homeowners who received the Senior Citizens Homeowners Exemption, known as SCHE, or the Disabled Homeowners Exemption, known as DHE, and therefore have provided proof of residency as well as proof of income for eligibility, did not receive this initial determination letter.

One of the most important aspects of this procedure is that this initial determination is not a tax bill. These notices simply inform property owners that, based on the information currently available to Finance, their property may be subject to the new surcharge. This is an initial determination, not a final one. Property owners who believe their property should not be subject to the surcharge have an opportunity to submit proof that the property is used as the primary residence. This process allows property owners to provide information that is readily available to the owners but may not be reflected in Finance's records.

Through this process, property owners can provide the Department of Finance with the information Finance needs to make an accurate determination regarding surcharge eligibility before the surcharge is applied. For example, a primary homeowner can submit their driver's license as proof of primary residence. Property owners can alternatively challenge Finance's initial determination directly with the Tax Commission if they are also challenging their market value for the 2026-27 tax year. They have until March 2027 to do so.

In implementing the surcharge, we have focused on providing transparency about which properties will be affected and ensuring homeowners have a straightforward way to resolve their status. We recognize that homeowners need clear information and meaningful support as they navigate the process. That is why the Department of Finance has prioritized direct assistance and outreach. Finance has been engaging homeowners and plans to further conduct proactive outreach at senior centers, community meetings and other public forums, provide information through our dedicated website at nyc.gov/psurcharge and 311, and where needed, work with co-op and condominium boards, property managers and building representatives to share information with residents. Where contact information for a property owner is available, we are also reaching out directly to homeowners who received notices to answer questions and provide guidance on the initial determination appeals process.

In addition, we are partnering with elected officials and community staff to distribute accurate information and connect homeowners with available resources. We have also announced an extension through September 18, 2026 for homeowners to submit appeals of initial determinations. We believe these efforts reflect the administration's commitment to ensuring that every potentially affected homeowner understands the process, knows where to turn for support and has a fair opportunity to challenge a Finance initial determination.

I understand there are concerns regarding this surcharge. I also understand that there are individuals who received an initial determination letter who will not ultimately owe the surcharge. That is exactly why the Finance Department has expanded its customer service and extended the deadline for property owners to challenge initial determinations. Finance is working directly with building managers, elected officials and homeowners to answer questions and make the process as straightforward as possible.

Whenever government implements a new law affecting thousands of property owners, questions inevitably arise. Government should communicate clearly and effectively about new policies, and Finance is committed to doing that — not just with respect to this law, but of course all aspects of Finance's work. The Department of Finance is committed to ensuring that this surcharge is only applied to those properties that are subject to the surcharge under the law. Finance is focused on making sure every homeowner has the information they need to understand the key contours of the law and determine whether they are subject to the surcharge. Finance's role is to administer and implement the law. As implementation moves forward, Finance has continued to engage with elected officials, responded to constituent concerns and provided updates and guidance to help New Yorkers navigate the process. We welcome continued feedback from the City Council and all stakeholders as we work to administer this new law with fairness, consistency and clarity. I am prepared and

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will welcome the opportunity to testify after August 30. That concludes the testimony from the Commissioner.

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I want to say that we also have CM Marte here. Anyway, so we are now going to hear public testimony. I remind members of the public: this is a governmental proceeding. Decorum shall be observed at all times. Members of the public shall remain silent at all times. The witness table is reserved for people who wish to testify. No video recording or photography is allowed from the witness table. Members of the public may not present audio or video recordings as testimony but may submit transcripts of such recordings to the Sergeant at Arms for inclusion in the hearing record.

If you wish to speak, please fill out an appearance card with the Sergeant at Arms and wait to be recognized. When recognized, you will have three minutes to speak on today's hearing, although we ask you to follow up. If you have a written statement or additional written testimony you wish to submit for the record, please provide a copy of that to the Sergeant at Arms. You may also email written testimony to testimony@council.nyc.gov within 72 hours of the close of this hearing. Audio and video recordings will not be accepted. For the in-person panelists, we will start with you. Please come up to the table once your name has been called. And now we will call the names.

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We are going to start with Kyle Bragg for the first panel, then Mary Ann Rothman, Jason Haber, Rebecca Pool and Thor... okay.

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Good afternoon, Council Members and fellow New Yorkers. My name is Kyle Bragg. I want to be clear that any legislation that is proposed to hold the wealthy accountable to their fair share is a good thing. My challenge is with the rollout and how unclear it is, with so many questions in the minds of so many hard-working New Yorkers. By way of example, I had a friend call me just recently asking me to explain whether or not he believes he might be subject to the Pied-à-Terre Tax. He worked over 50 years in the City. He and his wife purchased a brownstone 40 years ago, and he believes it is now worth over $5 million. He has retired to the South to seek warmer weather and to stretch his retirement dollars, and he is concerned now because he kept his brownstone here so they can stay in touch with his kids and his grandkids, whether or not

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he would be subject to the Pied-à-Terre Tax. It is the unknown facts and the unknown intent or consequences of the Pied-à-Terre Tax that is troubling to everyone. It is not only billionaires that are concerned. It is the everyday hard-working New Yorkers who are themselves trying to make things work that are very concerned about what impact it might have. My challenge, as well as that of all the people I have spoken to, is: what does it mean to them? Are there any unknown consequences or impacts to hard-working New Yorkers who this was not intended to affect? So thank you for your time and thank you for allowing me to speak.

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Go ahead. Next. Jason, go ahead.

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Thank you. Good afternoon. My name is Jason Haber, the co-founder of the American Real Estate Association and the president of NAIREA, a leading real estate voice here in the City. I have also been a licensed real estate broker for 20 years. First, thank you to the Council. When the State Legislature first proposed this tax, there was no hearing on the tax, and so today is actually citizens' first opportunity to speak to a legislative body about the tax and, in today's case, its execution. So thank you for that, Madam Chair.

Let us begin with the obvious. Let us begin with the docs. The City published 959,710 names and addresses in a downloadable list larger than the population of San Francisco. Imagine the gift that this is to fraudsters, to scammers, to anyone with ill will. Now, what does the administration have to say about the release of this information? Well, we heard from the letter that they are not able to comment today. Yet in 2016, during pending litigation, and in 2017, during pending litigation, they appeared before this Council. Yet not today.

They will tell you that this information was already public. But there is a difference between public and published. Any one of these records could be pulled from ACRIS, but to pull 959,710 records would take a single person working eight hours a day, five days a week, 15 years — or roughly 498 Scaramuccis, depending on how you mark time. Now the courts have a name for this. They call it practical obscurity: the Supreme Court principle that information no one can feasibly assemble is functionally private. That obscurity was willfully erased by the City. The Department of Finance did 15 years of labor for anyone who wished these New Yorkers harm. They handed it out, sorted and searchable, for free.

And what did this list have to do with the tax in the first place? According to officials, the pool of taxable homes is around 13,000. So how did that swell 74 times? And why is the burden on the individual instead of on the enormity of government? Why is it guilty until proven resident? CM Brewer herself was on the list, as she said — although to be fair, CM Brewer is at 10 events a night and sometimes in two places at once, so perhaps for her it is a Pied-à-Terre and she is never there and always out in the community.

Look, I am not here to litigate the tax itself. That debate is not with this body. But I am here to talk about the execution, and when that execution fails its citizens. Was this a doxxing by accident, by incompetence or by hubris? Keep asking questions. The citizens of New York deserve better and they deserve to know why this happened. Thank you.

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Quiet, quiet, quiet, quiet. Go ahead. Next.

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Good afternoon, Chair Brewer, and thank you for holding this important hearing. My name is Mary Ann Rothman, and I am the Executive Director of the Council of New York Cooperatives and Condominiums, a not-for-profit membership organization that has been providing information, education and advocacy for housing cooperatives and condominiums since 1975.

The State legislation that created the Pied-à-Terre Tax surcharge made co-operatives responsible for collecting and remitting to the Department of Finance the surcharge due from shareholders. This is a huge departure from past practices, where Finance has provided documentation to enable co-operatives to distribute credits to shareholders who qualify for exemptions and abatements. Never before have co-operatives had to collect funds and remit them to Finance. Any cooperative unable to collect from a shareholder in time for the January 1, 2027 payment will need to invade reserves, assess shareholders or borrow funds to keep the building's property taxes current. The smaller the building, the larger the portion of the non-resident owners' Pied-à-Terre Tax that each resident shareholder will have to find a way to pay. Where is the justice in jeopardizing the financial stability of a cooperative in this way?

Instead, the Department of Finance should collect the Pied-à-Terre Tax directly from each affected non-resident shareholder. Finance is already in communication with them by letter, and there is precedent — parking tickets, et cetera — for the Department to collect payment directly from individuals. Our organization is seeking Senate and Assembly sponsors for legislation to amend the Pied-à-Terre Tax to have the surcharge remitted directly to the Department of Finance. We hope that the City Council will support this practical and reasonable goal. Thank you.

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Hi. My name is Thor. I am a lifelong New Yorker. Thank you for holding this hearing. I am not speaking on behalf of any organization, simply myself. I am a co-op owner here in New York and I just want to share what the rollout of this tax has meant to me personally.

If any of you live in co-ops, you know that when you get assessments like this, as this woman said, it can be very disruptive to your economic situation. And that goes for all different types of co-op owners. Most of the co-ops in my building do not fall in at over a million dollars as judged by the Finance Department. However, there is one that does. It is a penthouse — three combined apartments. So I believe that as a result of that one penthouse, our whole building was on the list, and I was able to personally download and see the alleged value of everybody's apartment.

And you know what? It really feels to me like the administration, or the powers that be, are saying, "We see you. We understand. We see the value of the apartment. We are willing to expose you. We are willing to tell everyone." That is a direct result of the policies of this administration — I think they have said as much. I am not really asking questions. That is what I believe: that it comes from the socialist policies of a socialist administration that has manifested in the rollout of this very unfortunate doxxing. Thank you.

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Thank you very much. Next.

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Good afternoon, members of the Committees on Finance and Governmental Operations. Thank you for the opportunity to testify. My name is Rebecca Pool and I am the Director of Membership and Communications for the Council of New York Cooperatives and Condominiums. Our membership includes over 100,000 co-op and condo homeowners across all generations, living in member buildings ranging in size from a few apartments to well over 6,000 units, in 47 of the 51 Council districts.

As outlined in our recently released report on co-op and condo affordability issues, co-op and condo homeowners are struggling with escalating housing costs and well understand the City's need to close the budget gap without further increasing expenses for the majority of New York City's homeowners and residents. Therefore, we do not oppose a surcharge on luxury second homes that have sold for more than $5 million. We appreciate the difficulty in implementing this type of surcharge and believe that several changes to the State

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legislation would help resolve the strain the surcharge will place on New York City homeowners, particularly in co-ops and condos. We have attached our comments on the State legislation and rules, but I will highlight three key issues that concern us.

Co-ops and condos, as Mary Ann mentioned, are not set up to collect the substantial sums of the Pied-à-Terre surcharge from individual shareholders, and the requirement that the co-op take on this responsibility could be devastating, particularly to a small co-op where the Pied-à-Terre charge may be larger than the entire co-op's real estate taxes for the year. In a four or five unit building, the $1 million imputed market value of the co-op or condo used in the legislation does not equate to a $5 million sales price or market value, particularly in Class 2 co-ops and condos. Our analysis of Class 2 condominiums that sold between 2021 and 2026 showed that 68% of these apartments with an imputed market value of $1 million actually sold for less than $5 million in the past five years.

There are also issues with the definition and proof of primary residency, who qualifies as family members, and what happens upon the sale or alteration of an apartment or the death of the existing shareholder. Our recommendations regarding these issues are clearly laid out in our comments on the rules and State legislation, which will be provided.

Lastly, I would like to add that our concern over the retroactive nature of this surcharge is that what it did was remove options from some longtime homeowners who have resided in New York City for over 40 years and purchased a home in the 1970s, and now found out that because they were not a primary resident on January 5 of 2026 — already passed — they owe $80,000. We welcome the opportunity to work with the Council, the administration and the State Legislature in ensuring there is a solution that works for all parties. Thank you.

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Thank you. I want to say that CM Ariola is on Zoom and CM Brooks-Powers is here with us. Do people have questions for this panel? Yeah, go ahead, CM... yeah.

Thank you for being here. Carl, I mean, Carl, I do not know what you are doing. You are getting younger and younger after the fight on the streets. So thank you for being here.

My question is about the mailing of this big list. So now you are telling folks where people are located and how much money they have approximately, because one person said she does not have that kind of money. Is this a safety concern? Because I am hearing... do any of you have a concern about people knowing where you live and approximately how much your house is worth? Is that a problem, especially given that we have so many scammers around, as we have always been fighting against? So anyone can answer that.

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Thank you. I would just say that it has just been totally confusing. There is no conversation that I have had with anyone in this City that I feel really understands the Pied-à-Terre Tax and the impact on them personally. I am talking about people who have worked and lived in the City. It is our lives. So there is a lack of clarity and that is a problem. That is a problem when you are rolling out such an important piece of legislation and people do not understand whether or not it has an impact on them personally. We are not talking about the wealthy when I talk about billionaires. We are talking about everyday New Yorkers who spent their time, lives and service making this City better. So I think there is a lack of clarity and a lack of information available to people around the rollout, and that is a challenge.

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Council Member, if I could just address that also. I think a foreign actor could have already downloaded that list and can very easily do a mailing, make it look like it is from a City official, and say something like "pay $50 or $100 and you will not be subject to the tax." There are plenty of seniors unfortunately who already know all too well that they can be victims of scams. This is a perfect opportunity for those with bad intent to reach out to seniors on that list and target them for fraud.

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And on the letter you received, or your friend received, do they give them an opportunity to appeal if they need to? Any option like that, on their behalf?

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Do they get... no, I mean, absolutely you can. I think the process is that the burden is on that person, not on the government itself, and I think that they have that inverted. So they have put people, again seniors, in an awkward position. You know how hard it can be just having a senior upload information to their Social Security account, and now we are asking them to do something they have never done before, or hire an attorney to do it, which adds an additional cost and burden. The burden is reversed. It should be on the City, not on the citizen.

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I am still having a problem for folks, and like you said, some of the condos they may be worth whatever they might, and in the long run you cannot even sell it for probably three quarters of the price if you are lucky. So the surcharge... I am wondering how the board is handling it. Is the board dealing with that and how are they helping folks? Most of you are probably seniors in the condos and co-ops. So in your case, do they give an opportunity to discuss how you are going to face the challenges of the surcharges?

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Rebecca, go ahead. So a lot of boards and property managers have been providing education and holding meetings with their shareholders and unit owners to explain the tax and the rollout. The concern is really for co-ops: what happens if the tax is actually assessed and the shareholder does not pay the $40,000 or $80,000? Then the rest of the building would need to make up that amount. So in a 10-unit building, if the charge is $80,000, all the other shareholders are picking up slightly less than $8,000 each in order to pay their portion of the real estate taxes. So that is the primary concern for co-ops.

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I can see that. So thank you for your time. And the Pied-à-Terre... if it is just a little hazy on the ground, we are going to have to define what Pied-à-Terre means. Thank you. Thank you.

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CM Carr is also here and we want to hear questions from CM Carr.

Thank you, Chair, particularly for presiding over this hearing today. It is crucially important. I am just here on behalf of the many of the over 900,000 folks who are on that list inappropriately, because so many constituents are in fear and in confusion at a minimum, based on the release of their information in a way that is unprecedented. Everybody in government knows that for years the City publishes its tax rolls, but never has it been so easy to get at that information and to give a road map to individual property owners across the City, many of whom made the biggest investment they ever made, or the biggest investment their family ever made, and to be made to appear to be subject to this tax because of their success as a family, which is why so many of us came here over the generations. It is a shame.

And despite what was said in the testimony from the Finance Department, I do not believe a plain text reading of the law meant that they needed to publish this list in this way. They only needed to send out the determination letters to those they believe were subject to the tax. I could not agree more with what was said: it is a total inversion of the burden of proof for the City to be the ones telling property owners it is on you to prove that you are actually a resident here, it is on you to prove that you lease or rent out your property to a residential tenant. It is completely wrong.

I really want to commend Speaker Menin and the leadership here of the two

(00:46:37)

committees for trying to make sure that this rollout never gets bungled again, because that is exactly what happened. In particular, I am disappointed that we cannot ask the Finance Department directly in a hearing today any questions at all. But in particular, another issue that has not gotten enough attention is whether the Finance Department's evaluations of properties are correct.

(00:46:58)

There are many in this room and on this dais who spent years wading into that debate. Nobody thinks the Finance Department's evaluations are correct. It is a systemic problem that has been wrong for decades, and now we are relying on that flawed system to determine whether or not certain properties should be subject to the Pied-à-Terre Tax. In particular, so many of my neighbors, none of whom meet the property threshold or the financial threshold to be included on any list with respect to a second home tax... it just beggars belief that this is where we are at today.

So my question to the panel, whoever wishes to answer, is: do you believe that this rollout was done effectively or appropriately? And secondarily, what are your comments on the Department of Finance evaluation system in a general sense, with particular particularity to condos, co-ops or one- and two-family homes?

(00:47:52)

Councilman, the only word to use is "botched." It was botched. And just to further your point, Councilman, the weekend that the list was downloadable, I downloaded it. In two hours I was able to sort it using information also about age, and I could integrate age information if I wanted to create a targeted list. I decided not to release it. I kept it locally on my computer because I thought someone could use it with malicious intent. If I could do it in two hours and I am not even a computer programmer, imagine what someone could do who wanted to do harm to New Yorkers.

(00:48:27)

It is just that easy and it is just wrong. CM Wong next. Thank you, Chair.

(00:48:40)

So much for transparency. The administration is refusing to send anyone to answer for a rollout that has produced thousands of challenges, widespread confusion, a court fight and nearly 2,700 homeowners who have been told the City got it wrong. The Charter Revision Commission already showed that the Mayor's view of the Council's checks and balances is not something this administration respects when they get in the way. Now at the hearing convened to conduct oversight of the Mayor's own tax rollout, the administration is sending no one.

I would like to say this: my residents in my district should not have to hire lawyers to prove they live in their own home. Thank you. And if the City can access tax data that the statute allows Finance to use to verify residency, it makes no sense that the work is being handed to the homeowner to do instead. So my question is: do you feel safe now that the list is out there? Do you think homeowners will be targets of fraud, threats or harassment? Can anyone answer that?

(00:50:09)

Somebody besides Jason... I love Jason, but somebody besides Jason can answer that. On the specific safety question, I am more concerned that this is putting homeowners on the hot seat. What they are saying is: we know who you are, we know how much your apartment is worth, it is all up in the air, and there are going to be future taxes. We are going to tax you in the future. OK, thank you. Thank you, Chair. CM Hanks.

(00:50:54)

Thank you so much. Thank you, Chair Brewer, for holding this important hearing. I just really want to reiterate for the record my earlier statement that we really are not here to dispute the Pied-à-Terre Tax. This hearing is about everyday New Yorkers who have just been treated in a manner that is completely unacceptable. If the administration had shown the care in this rollout that it took to provide the written testimony, we would not be here today answering and asking these questions.

The one thing I have learned in my short time having the privilege of representing District 49 on the North Shore of Staten Island is that how you provide information to your constituents really reflects how you feel about them. It reflects respect. If you respect the people that you represent, you take great care in how that information is provided and absolutely in how it is perceived. So how the administration published more than 900,000 names and addresses showed me that this is how the administration feels about homeowners in this great City. This is something that we need to be ashamed of: a hit list of the haves and the have-nots, a scarlet letter letting everyone know, as you said so poignantly, "we know who you are and we see you." More importantly, the absence of a response and the written testimony as an amplification of that message.

So my question is: many of my constituents have found themselves on this larger hit list, but their home is in trust. Many people will do planning without letting their partners or their families know, so this is also an invasion of privacy on things that are very intimate, like how you are going to handle your parents' situations as they get older. People put housing in trust. Can anybody talk to me today about how that is interpreted when it comes to this kind of list? Because that is really the question I should be asking the administration, but this is the question that I would say ten or more of my constituents have asked. They are living in their primary home but it is in a trust. So I do not know if you have any... thank you.

(00:53:30)

The Department of Finance rules outline how a beneficiary of a trust can go about proving primary residency. I do not remember the exact details, but if you look at the Department of Finance rules it tells you what information the trust would have to provide. Unfortunately, the trust is automatically assumed not to be a primary residence, although perhaps the tax returns of the primary

(00:54:04)

beneficiary could be used to show that that is their address. I really appreciate you answering my question, but it is not the obligation of this panel to answer these questions, so I hope I did not put anybody on the spot. It was kind of rhetorical, but thank you all so much and everybody here that is here at this hearing. Thank you.

(00:54:24)

Thank you. And good luck if the in-laws are in there, because they are not on the list... just thinks he has been there. Oh, and now CM Morano.

(00:54:39)

Thank you, Chair Brewer. Thank you, Chair, for holding this hearing. Thank you to the members of the public that signed up to testify both here and on Zoom. Not only the five of you who we have already heard from, who all did a brilliant job, but for everybody who took the time to make sure this does not turn into a Clint Eastwood speech of us talking to an empty chair.

I do want to begin by talking about who is not here today, which obviously is the administration, and quite frankly I find that outrageous. The City was able to identify nearly a million properties and put them on a list for this tax. It was able to find 17,000 homeowners and send them letters telling them they could be subject to a substantial surcharge. But somehow today the administration could not find its way within the same building to City Hall to answer questions about it. I find that to be totally unacceptable. They have cited ongoing litigation. Well, litigation does not suspend legislative oversight. There are plenty of questions about administration customer service, data, staffing and basic competence that do not

(00:55:55)

require anybody to discuss litigation strategy. I do not accept that. This City's administrations have testified before this Council all the time while litigation is pending. Jason cited a few examples. In fact, the Law Department itself has appeared before the Council and discussed active lawsuits involving the City. Just last month, Corporation Counsel testified about the City's ongoing federal litigation over sanctuary city laws, and the Law Department routinely appears before this Council while simultaneously representing the City in scores, if not hundreds, of active cases. Nobody is asking the Department of Finance to waive attorney-client privilege or reveal its litigation strategy.

We are asking basic questions about how a major tax was administered. What records did you use? How did you identify the 17,000 homeowners? How many were identified incorrectly? Why were not government records cross-checked first? And why did you publish a supplemental roll containing more than 900,000 properties associated with the surcharge? These are basic oversight questions. So when the administration refuses to sit here and answer them, I think New Yorkers are entitled to ask a very simple question: what are they hiding?

In their written testimony, they claimed they were required to publish this massive supplemental roll. That is very much disputed. The state law, as Minority Leader Carr cited, says the Department of Finance must make an individualized initial determination about whether a covered property is not a primary residence. What I do not see in that statute is a direction from Albany saying "publish the names and property information of more than 900,000 New Yorkers and describe that list as related to the tax." In fact, the City's own website now acknowledges that the vast majority of the properties on that roll will not be subject to the surcharge. Only roughly 17,000 owners even received notices. So I would have liked the Commissioner to sit here today and explain that discrepancy. If you truly believe state law required this particular list, come before the Council, point us to the language and answer questions about it. But you cannot make a sweeping assertion in written testimony, decline to appear, and then expect the Council to simply accept it. That is precisely why oversight hearings exist.

(00:58:36)

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. So I sincerely hope that the administration does not decide to make this routine.

What was the error rate? We do not know. We do not want to hear a press release from the administration or a talking point. We want to hear your error rate. How many New Yorkers did government unnecessarily frighten? How many hours did people collectively spend fixing something that City Hall could have gotten right beforehand? How many seniors had to find documents? How many people called an attorney? How many people simply assumed that because an official letter came from the Department of Finance, they must have done something wrong?

I would also ask this, not of you but of the administration: the Comptroller estimated that roughly 13,000 properties would be subject to this tax. Why the difference in that number? Thank you. CM Dinowitz, thanks.

(00:59:51)

Good morning, everyone. I do have to agree, by the way. We were promised a new era of transparency in this administration, and it is deeply disappointing. Regardless of whatever is going on in the administration, they should show up and answer basic questions about the rollout — the role that is clearly impacting tens of thousands of New Yorkers.

I have a question about co-ops. I have a number of co-ops in my district, as you well know. We have a lot of things like local laws, and a lot of local laws like the Pied-à-Terre Tax. Most people support raising money for our City services from non-New Yorkers who have a vacation home in New York City. But like so many of our local laws that deal with the environment or health and safety, there are often costs associated with it — unintended consequences, unintended costs and quality of life concerns — because of the amount of work we need to do to comply with these laws.

I am wondering, for those of you representing co-ops or living in co-ops, if you not only anticipate concerns about that one or two apartments in the building, but any costs that the building itself would have to pay for consultants — that you are so used to paying for — or legal fees. Have you paid any of those costs yet, or do you anticipate, as this gets rolled out, that you will be incurring those sorts of costs?

(01:01:30)

There has already been discussion amongst co-ops about potentially changing proprietary leases in order to deal with the collection of this tax, which will not be done based on a shared distribution, but will rather be assigned to an individual. So that is a change in how expenses are collected. There will be proprietary lease amendments, which will require an attorney. Then obviously, if there is a Pied-à-Terre Tax and the tax does not get paid, there will be an attorney needed to try to collect the funds to pay to the Department of Finance.

If the building cannot pay the Pied-à-Terre Tax and it is left as an expense, there is the potential for insurance problems if the building has to renew their insurance and they have this debt to the City because they have not been able to collect it. The same thing applies if a mortgage renews. Those are sort of the issues that we have already seen people planning to try to address, depending on how this is rolled out. We just wish that there had been some discussion in advance of the legislation being introduced in the State with co-op and condo professionals, so that they could have weighed in on these issues before the legislation

(01:02:49)

went through. I would add, having served on the board of my co-op, I can tell you that co-ops are highly risk averse. So any little hint that something could cause a problem in the building — with the finances or the management of the building — will immediately trigger most co-ops to say, well, we are not going to allow any more Pied-à-Terre. That is just going to happen. That is going to close out a large portion of the market in many of these buildings. They are just not going to allow a Pied-à-Terre, so that is going to close out a lot of people who may not even be anywhere near the limit. They are just going to shut out anybody who is out of town, and that is going to severely impact the market. It is also going to reduce the price of co-ops. They are not going to be able to get the prices that they want.

Thank you. I appreciate that. It seems that there are going to be costs and concerns associated with this tax — which I support, by the way. I think most people in the Council support it. But without the administration here to even discuss these things on the record in public, it is very difficult to address these issues in a public forum.

(01:04:21)

I think you are right. I think the burden should be on the government, not on the individual shareholder or homeowner, to address the costs. In particular, in the case of co-ops, the burden should certainly not be on individual shareholders who would not otherwise be subject to this tax. So what steps should the City government be taking to put the burden on them regarding co-ops? Put a mike on, please.

(01:04:57)

The State legislation sets up the chart of evaluations and sets up the process as it is now, where the Department of Finance can have the co-op be the collector for them. So I think we have to work very hard on amendments to the State law as soon as the State Legislature reconvenes. I do not know that I can think of specifics that we could do here — they are right that it is State legislation — to help with the implementation of this difficult law.

(01:05:54)

But correct me if I am wrong...

(01:05:59)

I would just add that, if I had a magic wand, I would get the list off the internet immediately. I would invert the whole process and require the enormity of government to be required to tax the citizens and demonstrate it — not the other way around. I think those basic steps would cure a lot of confusion and would be fair, and I think that is a step in the right direction. Thank you.

(01:06:24)

Thank you so much. Thank you. CM Paladino on Zoom.

Good afternoon, everybody, and thank you very much for the opportunity, and to the two chairs — thank you for hosting this very, very important and troubling hearing. To echo what has been said again and again by my colleagues CM Carr and CM Morano: it is an absolute disgrace that the administration is not here to address these people, let alone us. This is extremely, extremely troubling. This list is indeed a targeted list. Let us cut through the chase here.

When you tax people to the point... let us say that one speaker spoke about a family that bought their house in 1970, was not aware, of course, that there was going to be a change, and they bought a second home in Florida or wherever. They are going to be facing something like $40,000 or more in back taxes on the new tax as being implemented. This tax is being implemented for one reason. It is being implemented because we have watched this administration go after private ownership. We have watched this happen continuously. It has been on his agenda since he ran for office.

So our mayor and the people who surround our mayor, and the State government — this is eminent domain, folks. Because if you cannot pay your property taxes, what happens after that? They come in and they seize the property. This is one of the ways in which they can foreclose on a property, be it a co-op and condo or private home ownership. This has been the ultimate goal of this administration from the beginning. The fact that they are not here — to Frank's point, leaning on their legal troubles, what is happening in court — that is not a reason not to be here. They are not here because they do not want to answer questions. This is a considered and deliberate conclusion, and it is a shame that these nice people, regular New Yorkers, came out to talk to what they hoped would be answers to the confusion.

There are 900,000 people. How is this possible? There are so many question marks to this. This is a targeted list. To everybody on that panel, you made a perfect, perfect statement, each and every one of you. But I want the people of the City of New York who can hear us today — and this will be recorded — I highly advise you to watch carefully, because the burden of proof is being left to the individual citizen once again. It is being left to the individual citizen. They will have to bear the burden of proof. This is totally unfair, and cowardly — absolute cowardice of this administration — because they watch everything that goes on. Yes, I am being very critical of Zohran Mamdani and his entire housing czar and their whole committee that they set up. This is all part of a plan. This is ultimately eminent domain. Who is going to be able to pay $40,000, $80,000 in back taxes and then pay lawyers to go up against the Department of Finance and drag their cases into court?

To the other gentleman's point about real estate: take that list down immediately. Immediately take that list down. This is so unfair and cowardly — cowardice on our mayor. Thank you very much for giving me the time. Thank you.

(01:10:13)

This panel is dismissed. I appreciate very much your testimony. You should know that I got a letter from somebody who says that they will take care of my Pied-à-Terre Tax. I do not have one, but I appreciate the letter.

The next panel is Ana Champeny from the Citizens Budget Commission, Charles Diamond, Susan Peters, Leonard Steinberg and Heather Tommy. Thank you.

(01:10:54)

Little groups — whomever would like to begin, feel

(01:11:01)

free to start. I will be brief. That is okay.

(01:11:04)

Yes, please. Thank you. Chair Brewer, the entire Council — my name is Charles Diamond. I worked for the City for nearly a decade, including on probably close to a dozen implementations of State law changes into local law. I am here today to speak in my personal capacity. I do not even own a home, but I am so disturbed by this process that when I saw it, I wanted to really thank the Council for refusing to abridge its responsibilities during a time like this and holding this hearing.

Regardless of one's thoughts on the underlying policy, the release of personally identifying information by the City — like names and addresses — is usually a tortuous process on purpose. Talk about all of the different times when we release PII, and there are reasons why this takes a long time. In this case, over 98% of the people are probably not subject to that tax. That kind of over-inclusion of PII should be extremely concerning to us all. If it was in furtherance of a political objective, that should be even more concerning.

I found it very disturbing — the argument in the Finance Commissioner's written testimony that this information is otherwise publicly available. That is not usually the standard when the government collates and releases and publishes information in a different way. It carries its own risk. Chair, you and I have spoken about this in a previous time with procurement. Talk about the cautions list — a list of people who have gotten poor performance reviews. The City has refused to ever publish one list like that because of — to use the phrase I think someone else used — it would be a scarlet letter and could be used in negative ways and give negative implications. That is about contractors who choose to contract with the City. For some reason, that normal, cautious analysis did not happen here, and we need to ask why.

So thank you for doing that. What is even more disturbing and more important is the fact that no one from the administration is here to testify today. It is unacceptable to use the idea of pending litigation as a reason not to testify at an oversight hearing. Almost every City action is subject to some potential litigation. I myself have sat here during the asylum response hearings, and there have been individual questions when I said, you know what, I cannot answer that question due to litigation or pending actions. But here is what I can talk about, and here is how it generally works. That is how it is supposed to work.

In fact, what this really reminds me of is an incident in the last administration when the Director of Intergovernmental Affairs read their testimony, then stood up and walked out. The entire Council at that time was unanimous in their condemnation of the administration. In this instance, they did not even show up. It was bizarre, Chair, to hear you reading a commissioner's testimony into the record. It is utterly, utterly bizarre.

So in that sense, I urge the Council to condemn the actions of the administration in this instance — what may be less politically convenient — because they have shown through their actions that they do not consider the Council as an equal partner in government.

(01:13:57)

Contrary to many of their assertions before getting here. So thank you to the Council. Thank you. Next.

(01:14:05)

Good afternoon. I am Ana Champeny, the Vice President for Research at the Citizens Budget Commission. Thank you for the opportunity to testify. Clearly, implementation thus far has been rocky. Insufficient vetting, compressed rollout and inadequate communications all contributed to confusion, and both the City and the State can learn from the early stumbles. CBC does not support the Pied-à-Terre Tax. There are, in our belief, better ways to stabilize the City's budget. But our decades of experience on tax policy importantly reinforce the importance of high quality tax administration.

Looking more specifically at the challenges: first, the legislation received limited public vetting. The Bill language was released just one day before the State Legislature voted, leaving little opportunity to identify ambiguities and implementation challenges. Greater vetting would not have prevented all issues, but would have improved the odds. Second, implementing a new and administratively complex tax with less than eight months from enactment to revenue collection — the law requires determinations about values, ownership and residency, including special rules for co-ops and condos. To meet the deadline, the City developed regulations and administrative processes in less than seven weeks. This time constraint makes the desired careful consideration of public input and communication harder.

Third, the City's public education and communications were insufficient. Many did not understand that the law directed the City to, quote, "open to the public the books of annual records of market values of covered properties," which is a much broader group than those subject to the tax. The City chose to comply by publishing the supplemental roll. This choice appears reasonable, but it did also create near-instant confusion. Notably, adequate vetting of the legislation would have helped inform the public or led to a change in the legislation itself. Also, the City did publish more variables than were required and did not indicate whether properties might be subject to the tax. Concerns about public disclosure of private information are understandable but potentially misplaced, as the information is already public in the tax roll, in the PLUTO database and in numerous other sources.

The City should have communicated more clearly about the 17,000 letters — who would receive a letter, why they needed additional information and the next steps. Given this confusion, the City was right to extend the deadline. In addition to the lessons noted above, the City should take this as an ideal opportunity to evaluate the Pied-à-Terre Tax's impact on property values, transactions, housing supply, ownership patterns and tax revenues. These findings would enable the Legislature to smartly adjust the policy if it generates unintended consequences, while also informing comprehensive property tax reform. The City could also evaluate broader related impacts of changes in supply and ownership — not just on property taxes, but all revenues. Thank you.

(01:17:13)

Thank you. Next. My name is

(01:17:15)

Leonard Steinberg. I am in the real estate world, and I was a little kid in Africa at the age of 20 dreaming of coming to the United States of America specifically because of the dream of fair and equal treatment. That is what is specified in the Constitution of the United States of America. Everything about the rollout of this tax has been pretty unfair and unequal and extremely punitive. I speak to all of you here and I thank you, especially those of you who were capable of showing up to something that is important.

I think there is a misnomer about the numbers, and I am going to look at some of the numbers today. But the messaging around this tax is outrageous, and I will give you some examples of just how outrageous it is. Even today there was mention of this tax applying to apartments and co-ops, condos and co-ops with a market value of a million dollars or more. That is the message that has been sold to the entire United States of

(01:18:09)

America, all New York citizens and around the world. That is a false statement.

(01:18:14)

Because the market value that the City applies to property is not the market value that most people would assume is market value — what it would sell for. That means that statement is grotesquely inaccurate. Secondly, homeowners, yes, but it applies. How many people live in each one of these homes, Eric? That amounts to about 3 million New Yorkers out of 8 million New Yorkers. That is about 40% of the population you are alienating. But the messaging around this is so divisive and anger-fueling, and it stands in sharp contrast to the message we have been given about uniting this City and bringing us together.

New York City is the dream of people around the world, just like myself. I dreamed of this City and I dreamed of this country because it was inclusive, it embraced everyone. Here you have something that is specifically and purposefully aimed at dividing, fueling anger and division. That is wrong. So what I am asking today is for the Mayor and for the City Council to come together and come up with an apology to all New Yorkers, because it is every single one of us in this room who pay taxes. Yes, 900-plus thousand people pay a lot of real estate taxes, but everyone in this room pays sales tax and a whole host of other taxes. This City Hall is paid for by the taxpayers of this room and everywhere, to do the job of the people. The people of New York demand that New York City is represented by its Mayor and City Hall as the bastion of desire throughout the world. The world should crave to be in this City. This sends the exact opposite message.

So I am asking for a great, beautiful video that comes out on social media — because this is a very social media savvy group — to apologize to all New Yorkers and to clarify the message to the world that no, we are not aimed at dividing, but we are actually aimed at uniting the people of New York City. Thank you.

(01:20:17)

Thank you. Next.

(01:20:24)

Hi, my name is Heather Domi. I am a resident of District One and I am very grateful to be here today. I am a real estate broker, have been for 20 years, and I am grateful to the Committee here and Council Members for taking this issue with such seriousness. Personally, there are going to be talks about the unintended consequences because we have not gotten to any of that and that is really important. I do want to make sure we do not lose the fact that this was meant to target homes above $5 million, and as Leonard Steinberg pointed out, the assessed estimated market value of $1 million is what tends to get swept up in the conversation. We are losing the fact that this was meant to target above $5 million.

There is inequality in our system of estimated market value. Point blank: examples of an apartment at 15 Central Park West that closed for $21 million, and a $3 million condo on the Battery that closed for $3 million. The property that is seven times the amount of the other one has a lower estimated market value than the $3 million property. So the system is so incredibly flawed in the way that it is valuing these properties that it is targeting all of the wrong people. We are targeting retired people. This is targeting people who have bought from deceased trusts, so there is no one to claim residency for the January 5th date. People going through renovations who are here full time but cannot claim residency to the property because it is unlivable. Unhappy owners who have rented their properties out — they have made investments in our City and paid taxes for years, and they put tenants in their property who have long-term leases. Maybe those people are not full-time residents. But guess what?

(01:22:26)

They are stuck in a lease with a person who is not a full-time resident. So now they are going to have to also pay the Pied-à-Terre Tax on that. So the unintended consequences and the cases are so wide and so vast. A client who is retired, exited the City, selling their property — now they have to contest the tax, but by the time the property sells and closes, they will no longer own it. Will the City honor the fact that this property is not worth more than $5 million and that they sold the property, and will they get credited back? So there is so much uncertainty, so much fear that has been created within New Yorkers who have lived here and invested here, that it really has to be looked at. So many different cases: trusts that were not set up with this tax in mind, owners with joint partners that own 33, 33, 33%. This structure and the cases need to be examined very closely.

(01:23:28)

Thank you. Do not forget about the angles. Go ahead. Can you

(01:23:40)

hear me?

(01:23:41)

Can you hear me? OK. Hi. My name is Susan Peters and I am a resident of the Upper West Side of Manhattan and a member of the American Monetary Institute, a 30-year-old monetary reform organization. I speak today about the root cause of distress in our City, displayed today by our need to legislate a wealth tax. The root cause is the U.S. monetary system, which determines the creation and distribution of money — who creates all the money our citizens need to live, who decides who will receive that money.

I worked for 17 years as a data professional for a Wall Street bank. I learned the secret of private banking. Our money — the money we all need to pay rent, buy food, clothe our families, send our children to school — is privately created by commercial banks. Quote: "Every time a private commercial bank makes a loan, it creates the loan principal by writing a bookkeeping entry for the principal in the borrower's checking account." This is new money, creating the U.S. money supply. Hard to believe. Legally, the banks can charge interest and foreclose on property when the borrower defaults. This is a vast power in the hands of private parties, not taught in our schools or discussed in our media. These private banks are deciding who gets loans, therefore deciding where the money goes. As any citizen can see, the loans are going to the financial sector, which creates stocks and bonds, bubbles, and ignores the real economy where we all live. Real infrastructure in our City suffers.

I would like to give you some documentation. One of them is an article from 2014 published by the Bank of England, which has the same system as ours. The title is "Money Creation in the Modern Economy." Quote: "This article explains how the majority of money in the modern economy is created by commercial banks making loans." End quote. Number two: quote: "In the modern economy, most money takes the form of bank deposits. But how those bank deposits are created is often misunderstood. The principal way is through commercial banks making loans. Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower's bank account, thereby creating new money." Thank you very much.

(01:26:46)

The Council has a question, and then CM Wong. CM Menin is here as well. Go ahead.

(01:26:57)

Thank you, Chair. I was not very surprised the administration had no one come to testify. Sometimes even when they are here, they are not prepared to answer any questions anyway. I just want to make some statements and also have some questions. I want to be very clear: I am here not to speak up for the outrageously wealthy people who own multiple luxury properties, who will never pay that — they have tens of thousands of dollars in attorneys working for them. I am speaking up for hard-working people who have been wrongly identified and have been asked to prove they should not be taxed. The City sent around 17,000 notices to property owners. I actually got three phone calls from my constituents. One person is elderly right now, his granddaughter is living in his apartment. He has another house in my district and he is worried about what he is going to do. Maybe he should sell his apartment in Manhattan and kick his granddaughter out, or something else — he cannot afford an additional $40,000 expense for the tax. This is the type of person we see every day.

I also have someone in the military asking me, does he need to pay the additional tax? These are the questions I get asked, and I just feel it is embarrassing for New York City government. We should not tax hard-working people. We should encourage them to work hard and not just give them an extra tax all the time. So my question is for the administration: how was the decision made, and how did you identify 17,000 people on the list? What did you gather to do with those people, and what is the next step if they are not able to provide the information on time? Some people are not here in the summer. So what is the purpose and what is the benefit to New York City? Well, these people cannot answer those questions, but I know. Yes. No, you answer my question.

(01:29:35)

This is my answer. Thank you, CM Wong. Thank you.

(01:29:42)

Chair, I have a question about the Citizens Budget Commission. We have this tax with a five-year sunset clause. How does the Commission assess the risk of this five-year sunset clause ending after fiscal year 2031? Does that create instability in the City's revenue planning, and would you recommend any reauthorization or phase-out framework right now?

I think it really depends. Having a tax that sunsets and is temporary is arguably not the sort of recurring revenue that you would want to base your budget on long term, so it is a fiscal risk that it is set to sunset. Though we have seen that many taxes set to sunset in Albany get repeatedly extended, so I think there is some possibility of that. I also do think there is a question about comprehensive property tax reform and, if that were to take place, how that would interact with this tax going forward. But I do think you raise a good question about long-term planning with regards to a tax that will sunset, and we really do have to wait to see how much revenue it will yield, so that is an unknown as well. Okay. Thank you.

(01:31:01)

Thank you.

(01:31:01)

Just to add — the problem that we are having right now is those folks who are not really millionaires, like many of the people we are talking about. We are talking about average folks. We heard it from earlier — people who did everything they were supposed to do. Like this young man said, that is what is appealing about New York City. This is a place you want to be. They work all their lives, and like my colleagues just mentioned, those are the people we are really concerned about. How are they going to do it? In the letter that you receive — have any of you received that letter from the Department of Finance already? We have read them. Okay. So that is not directly for you by name. So what is actually for me? I am asking — by the way, before I have even asked my question — we are not the ones that are talking about the Pied-à-Terre Tax. We are just trying to find out what we can do to help, because you elected us to do our job. So it is not us that came up with the Pied-à-Terre Tax directly. We are trying to do our very best. I just want to tell you that. So what are the options left on the table for those who received the letter? Because we are talking about September. Did you find an organization — any organization listed? Did you call anyone? Did you call the

(01:32:40)

Mayor's Office or the Department of Finance to see what options you have? Because when you receive letters as bad as this — we disagree, it should not be online for all those folks. I am concerned about seniors, the people that do not have anyone. People are knocking on their doors or sending them emails. I am concerned about all of that. But I am saying,

(01:33:01)

do you have a nonprofit organization listed from the Department of Finance? I tell you, this is what you need to do and how you can do it to make sure that you are not falling into the bucket, because you worked so hard, you do not have extra money, and now you have that tax over your head. If you do not pay it, you are risking your livelihood, which is your home.

(01:33:21)

So do you have that? What does he have to say? Yeah, go ahead.

(01:33:25)

I think the letter was somewhat clear, but I think the messaging is the problem. I think the communication style is so unclear to so many people, and for others who are more adept to these matters it is pretty basic what you have to do and pretty obvious. But for a lot of people it is overwhelming. They are calling brokers, they are calling lawyers. I think what needs to happen is a very aggressive clarification of exactly the action steps as to exactly what you should do. Maybe that should come from the Mayor himself, so that he can explain to people: step one, do this; step two, do this; step three, do this. And I apologize for this horrific public relations difficulty — probably the most expensive public relations debacle in the history of New York City.

(01:34:10)

Anybody else want to comment? Yeah, also, so for a lot of the people with the unintended consequences — these are use cases that are outside of your typical

(01:34:21)

very basic situation. Just send out your information verifying your residency status. When you have to do that, you have to hire an attorney. Attorneys are charging $2,500 just for the first initial consult. Some are charging success fees like 10% of the money that they save you, and then some others are not able to give them the full total of their fees and charges depending on their case. So it is becoming an instance where there is an attorney grab going on, but people do not have a choice because it is not clear and they do not know what else to do.

(01:34:55)

I would also just add — I mean, let us compare this to the norm. Would you say local law 97? Eight years of implementation. How many focus groups? How many specialty groups were created to provide one-on-one customer service? Containerization, right? That was sped up, and that was still three or four years of explaining, mailers, all these different things. So in terms of the norm, I think we can see a very big difference between educating our taxpayers, educating our homeowners, and what they have to do — how we normally do it versus how we did it this time.

(01:35:24)

So there is no structure for you to follow to see how — because I know some folks, they are millionaires on paper but they are not really having the extra. We are talking about getting a lawyer if they have to do that. They are running the risk of losing their homes, and that is my concern. Anyway, thank you so much for your time. We are going to do our best. I can only apologize for the government in general, but on this City Council side, that is not us. I just have to be clear. Thank you, panel, very much.

(01:35:52)

The next panel is Robinson, Beverly Solo, David Backer, Isabelle, parents are Curry and Laura Panera, Amanda — whoever wants to join us. Are you all here? All right. Whoever would like to start, go ahead. You have got to push the button.

(01:36:41)

My name is Beverly Solo. I live in Inwood, in northern Manhattan. I have lived in New York City for 44 years. I am a grandparent and a parent of two public school teachers. I am also a lactation consultant and have worked to help countless new parents return to the workplace. I am not here to talk about the merits of how this was rolled out or the implementation — clearly it has been a mess. The vast majority of the discussion has been about that. But let us say those problems could be resolved. My message is simple: I want to see the revenue from the Pied-à-Terre Tax go to schools and child care, properly funded. The school where my son teaches in Queens could more meaningfully support all students in growing and learning to the best of their abilities. More funding could mean hiring more teachers and lower class sizes in accordance with the law, which is not being followed now. More tutoring hours for students — as it is now, my son often tries to fill the gaps on his own time with extra tutoring. Teaching teenagers is not as stressful as the lack of resources for public school teachers.

Some of his students are also unhoused. The cost of child care is one of the causes of homelessness. With free child care, hopefully we will no longer have nearly one in seven students living in homeless shelters. On a personal level, I want my son to be able to continue to live in the City where he was born and raised. I want to be near my grandchildren. Taxing the rich is extremely popular among working New Yorkers, as is our Mayor. Whenever I wear this "Tax the Rich" t-shirt, people on the street smile or say, "I like your shirt." We who live, work and pay taxes here year round make this City a desirable place to have a second home. It seems reasonable and fair to ask those who do not 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 students. I really, really hope that the problems in implementation can be resolved so that those who are able and willing to pay taxes on their second pleasure homes are able to do it, so that we can have the revenue for really important public services. Thank you for the opportunity to speak as a private citizen not representing any organization.

(01:39:37)

Hello. My name is Isabel Opinion and the Curry. I am a page and researcher at the University of California, Berkeley and I study public finance, land and property taxation and city planning. I am also a Colombian born in Washington Heights, resident living on a graduate student budget, working multiple jobs and even then, after paying rent and basic expenses, there is not a lot of money left. I strongly support the Pied-à-Terre Tax. My research has taught me that a city's fiscal system is more than an accounting mechanism. It is an expression of a social contract. I have also learned that there is a surprising consensus in orthodox economics on what makes land and property valuable and it is not the property owners.

A $5 million or $20 million apartment, say, overlooking Central Park is worth that much because it overlooks Central Park, because of our parks and subway systems and public investments and its proximity to Wall Street, and because this is a productive and unique city that millions of people make run. In other words, urban property value is socially produced and precisely for this reason it is entirely reasonable that those who can most afford it, those who not only own a $5 million property but own more than their fair share, should return that value to the public that helped create it.

Unfortunately, our current property system does the exact opposite. We tax the wealthiest the least. The City's own reform commission found that a $500,000 home could face more than three times the effective tax rate than a $5 million one. I ask you: what kind of social contract does that reveal and is that the social contract that you want to uphold?

New Yorkers know what they want. Recent polls found that roughly two thirds of New York City voters support higher taxes on millionaires. Economists also agree land taxes do not dampen economic activity. The richer the residents, the less likely

(01:41:39)

to leave New York, according to the Fiscal Policy Institute. Even economists call this a gentle tax. They also know that an economically successful city requires public investments rather than a few slightly wealthier millionaires.

(01:41:55)

I should also add that I am a little shocked that the foundation of local public investment, property taxes, is being referred to in these proceedings by City Council members as a hit list, a scarlet letter, a security threat or a form of eminent domain.

(01:42:12)

I am sympathetic to the concerns over difficulties in implementation. I myself have spent months observing assessors and bureaucrats who implement property taxes as part of my research. I also know that if this tax is blocked or significantly delayed because of the minutiae of the rollout, which perhaps does have problems, New Yorkers will see these hurdles exactly for what they are: ideologically motivated and meant to protect private wealth.

If we want New York to remain a city for teachers, families and everyone else who makes it run, not simply a place to store wealth, we need a tax system that reflects that social contract. I expect the City Council to stand by that and to support the Pied-à-Terre Tax. Thank

(01:43:00)

you. Next.

(01:43:00)

Hi, Council. My name is Dave Backer. I am a parent of a six year old who is going to first grade in Brooklyn and a nine month old who I am hoping will go to pre-K after that. I am also a co-op owner and I was excited about the rollout of this surcharge. I did not feel fear, I did not feel nervousness, I did not feel any panic at all. In fact, I was excited about it and I was excited about it for a lot of the reasons that the last speaker just said. I happen to be a professor of school finance as well and I know that the real problem here is not necessarily the rollout but the way that property taxes are misstructured and the way in which our kids' schooling and child care is all relying upon it.

The real problem: 43% of the money that goes to our kids' schools and child care comes from revenues brought in from property. Now we have a trillion dollars of market value in this city that we could tax but we are only assessing about a fifth of it. We are falling short there. Single family homeowners, as the last speaker just mentioned, actually already pay 2.4 times less in their effective tax rate than multi-family dwellers.

So my partner and I actually moved out of New York City. We went to a more affordable city. We had our daughter and when we heard that pre-K was coming out we were like, wow. We looked at the numbers and it turned out we could save $60,000 a year by moving back to New York City, so we moved back. We came back and we want that for everybody in this city and we want to keep building on it. I think the wealthy homeowners here doth protest a little too much and I really hope that this debate, quote unquote, actually does not get in the way of much needed revenue in the City. Thank you.

(01:44:58)

Thank you. Next.

(01:44:58)

Good afternoon, Chair and members of the City Council. My name is La Pena Amanda and I am here today as a worker, a co-op president and public sector union member to speak in support of the Pied-à-Terre Tax. Today we stand under the emblem of a government of the people, for the people, by the people, a principle which should hopefully inform today's hearing. I am a full time CUNY staff member, a member of the CUNY union, a researcher at the CUNY Research Foundation and a CUNY alum.

Everything I am, I am thanks to the public education institutions of New York City. CUNY as well as many public services are the infrastructure that makes private and common wealth possible. The question before us is simple: who should pay for that infrastructure?

I believe those who have accumulated the greatest wealth should contribute the greatest share. That is not an attack, contrary to what we have heard today, on ordinary homeowners. It is a recognition that housing should be a place to live, not simply another vehicle for accumulating and parking wealth. As a CUNY worker I see every day what public investment makes possible.

CUNY is one of the great democratic institutions of New York. It gives working class New Yorkers like myself access to education, research and economic opportunity, but higher education has been asked to do more and more while operating under enormous strain. Our public institutions are the common wealth of the City. We should reject the idea that government must constantly make working class people choose between the services that allow for a dignified life and other basic necessities. The wealth exists.

Today's City Council hearing asks: are we visionary, bold and courageous enough to organize our tax system so that wealth contributes to the society that produces and sustains it? I urge the City Council to stand with public sector workers and stand with CUNY. City Council, stand for the principle that the wealthiest among us should pay their fair share. Thank you.

(01:47:14)

Thank you very much. We always stand with CUNY, I wanted you to know. But also many of us, the Speaker and certainly both co-chairs and many of the members support this tax. I want to be very, very clear. The Speaker was the one who suggested it initially to the State, so it is a tax we are debating. It is the implementation that has some challenges, but I just want to make that clear. Some members disagree, but I want you to know that CM Lee and I in particular support this tax, so you are clear.

I do not think there are any questions, so next panel. Thank you all. This panel is Lucy Sexton, Ed Lee, Arlene Barwick and Ken Fisher. Okay. Go ahead and start. Lucy, you want to start?

(01:48:19)

My name is Lucy Sexton. I lead New Yorkers for Culture and Arts. It is a coalition of hundreds of artists and cultural organizations of all sizes across the City. I am here to talk about the impact of this law on artists. I want to also start by saying that I have long supported and been in favor of a Pied-à-Terre Tax. I lived in SoHo for some time and it was distressing to see that neighborhood with dark windows at night, no families, no people living there. It really hollowed out the neighborhood and raised those prices. So while I am in favor of it, I am asking the City Council to address one particular part of it.

The artists who moved into SoHo and other places in the 70s and transformed industrial spaces were at risk of being told they should not live there. So the City Council came up with the joint living and work quarters designation for those units, which meant that they were going to work there, rehearse there, hold dance classes there and also live there.

Right now I have a member of my organization whose parents were very famous postmodern dancers. David Gordon and Valda Setterfield established their loft in SoHo in 1976. They died recently and he now owns it. He is continuing to use it as he has for 40 years as a place for his theater company to rehearse. He gives it out at low to no cost to dance companies for dance classes and performances. It is in heavy use. He got a notice that he has to pay $90,000. He makes less than that in a year, so this will wipe him out and force him to sell the unit if it goes through.

I am asking that the Council look at the joint live and work quarters designation and make a special exception to say that yes, if it is being used for nonprofit arts purposes, if it is being actively rented and particularly rented at well below market costs to artists to live, work and create work in, that should also be a reason that they should be able to hold on to that unit. The City Council stepped in in the 70s to

(01:50:37)

protect them and make sure they could stay there. At this time when artists' housing and artist workspace is in woefully short supply and we are barely able to make a living and live here, do everything you can to protect spaces that must be able to prove it but are still being used for nonprofit arts production and rehearsal. Thanks.

(01:50:55)

Thank you very much. Next.

(01:50:59)

As a Republican, I do not think... Thank you. Hi. How is it going? My name is... I am a Republican and I do not take a knee-jerk reaction to everything someone says and say that it is bad. I am with the Pied-à-Terre Tax in spirit because we know that the rich use tax shelters like capital gains and dividends and pay proportionally less than the rest of us and I am for fair treatment. By the way, Trump has done significant work to prevent people from hiding money overseas, but this tax unfairly targets people who choose real estate versus other industries such as securities. Family assets will be impacted also. What are the taxes spent on? Is this really for the little people or is this just one set of aristocrats attacking another set of aristocrats, but now with fancy marketing language? I see a wolf in sheep's clothing and the wolves in sheep's clothing honestly spill more blood.

I am homeless right now because the not-for-profit system picks winners and losers. I work with the longest wrongfully incarcerated man in New York State history, Otis Johnson. The parents of Antonio... caused the resignation of the chair of... Gregory Rust, a disabled victim of deep theft, terrorized by a tax-sponsored anti-violence group who was here speaking later today. I have extensive documentation of City agencies and funded not-for-profits not just ignoring my coalition but actively raising barriers and interfering with our quest for justice, sometimes even violently assaulting members of my coalition with no acknowledgement or consequences.

Private universities do not pay property taxes while they destroy the financial futures of our children. Maybe they should be considered to pay property taxes. What prevents this from happening? A 2016 Inspector General report found that CUNY spent significant resources on outside contracts, including for lobbyists engaged in questionable and seemingly redundant tasks, despite also employing its own central and school-based government relations staff. A highly visible electoral action group, which is primarily a unionized college professors group, is asking for more federal research dollars, while... was having cocaine parties and sexually harassing staff and misusing federal research dollars.

I hold New York City's only third-party debates and every candidate in the 2025 election cycle has asked for a public debate between myself, Corey... and the CUNY Chancellor as well as Hunter College president on that. City agencies and not-for-profits have consistently let us down. Before the City raises new taxes, the City should focus their efforts on fixing the broken and corrupt systems that pay homeless shelter executives more than the U.S. President. My fellow homeless people are dying, protesting the violent and dysfunctional, self-serving City services. Parents have left this City. They are now in Florida, disgusted by the lack of care for their issues. Thank you for listening and God bless. I know there is a lot of well-meaning stuff behind this tax, but...

(01:53:33)

You are not spending it well. Next. My name is...

(01:53:39)

...Borrowing. I am the treasurer of a small self-managed building in... We have four units. It is unclear, as it is for many people, which of those will have to pay the tax, but they each will have to pay, if they do, almost as much as the whole building pays, which is completely unfair.

Most of that is due to the rather unusual decision made that somehow co-ops are valued at only 20% of single family homes. We get values on our property taxes on the notice of property values and so on and we know roughly what those values are. There is no way that our building, despite being a beautiful landmark, is worth $44 million, which is what the de facto jump of five times for a co-op building for each unit implies.

I have a couple of problems about the tax, most of which I suspect nothing can be done about. The idea of a retroactive tax, where it is kind of an unhappy surprise that something that happened last year is what defines what has to happen to you next year. The second thing is it is somewhat of a surprise to have a real estate tax being based on market value not assessed value, both in New York City and elsewhere.

But the third thing, and the thing that might be actionable in some way by the City Council or by the Department of Finance, is that there ought to be some kind of exemption that enables a co-op worth theoretically by market value between, let us say, $1 million and $2 million, which sounds like a lot of money, frankly to me, and there is a lot of money, to be shown to have a specific market value. Once they have that they can be put into the class of single and two and three family homes.

We live in co-ops. They are single family homes. Why there is a discrimination between us and the other single family homes is really kind of beyond me. Most people who live in a co-op or condo have a reasonable idea of what their market value is and anybody who is either the treasurer or the property manager of the building knows what the assessed value of these buildings are and I think those should be used. Thank

(01:56:22)

you. Thank you very much. Next.

(01:56:26)

First of all, I would like to thank the Committee very much for holding this hearing. I am wondering, before I even give my testimony, what power does this Committee even have to assist in the implementation of this tax? Could anybody answer?

(01:56:40)

We have oversight responsibility and certainly the fact that you are all here gives us even more ammunition to question the implementation. So it is a process, but we are going to get answers to the questions. Thank you.

(01:56:56)

I would like to relate to you two cases today. The first case is for my own apartment. I live at 733 Park Avenue, floor 29. I have lived in this apartment full time since 2018 and have always filed New York City and New York State tax returns. I would like to add for the record that I pay a ton of tax.

When I was in the elevator going to my apartment I just happened to bump into a neighbor. He informed me that he had received my non-primary residence property surcharge notice. I was shocked and I took a cell phone picture of it. My apartment was clearly listed on the notice. However, my neighbor's name and his wife's name were on the notice. The post office had delivered the notice to his apartment. If I had not run into my neighbor in the elevator that day I never would have even known about this matter.

So I gathered my documents to prove my primary residence, such as my shareholder's certificate, my tax returns showing my address and my driver's license. When I went into the website, at first the website would not let me proceed, claiming an incorrect PIN. I tried several times and it would not let me proceed. So I put it aside and I decided to give it a try another day.

Yesterday I tried again. This time the PIN worked. However, my apartment was marked as filed and it would not let me proceed or submit any documents. At this point I have no way of objecting to the non-primary residence notice. I think that this entire process has been completely botched. Am I not entitled to due process? Am I just supposed to pay a tax of $58,479 without at least having an opportunity to rebut it?

(01:58:53)

I have to prove that I live in this apartment. That is case number one. Case number two relates to my son's apartment. In 2012, I established a trust for the benefit of my daughter and my son. We purchased an apartment right down the street from me for my son to live in, and he lives there full time. He got the same notice. Now, under the law, the rule is that if you are the sole beneficiary of the trust, you can contest that. But if there are two people who are beneficiaries, you cannot contest it. Now in this instance, unfortunately, my daughter passed away. So we will be able to contest that, but it is such an unfair thing. We set up that trust in 2012. Here we are in 2026 with a law that applies prospectively, not retroactively. It is just so unfair.

(01:59:51)

Well, we will be glad to set you up with somebody at Finance if you want, particularly for case one.

(01:59:59)

I filed a complaint with Finance, and I checked my cell phone while I was waiting to testify today and they replied. A very truncated answer. All it said was withdraw the prior submission and resubmit.

(02:00:13)

Now, I did not submit the first submission. Okay, well, we will be glad to help you with that. Just so you know. All right. So thank you very much. Thank you. All right, go ahead. Thank you for being here. Whoever would like to start, go ahead.

(02:01:03)

Yes. Hi. Good afternoon. My name is Katie Presley. I am a resident of New York City. I am here because my case is relevant not to taxes, but because it is with the Department of Finance under the deed theft office. I have lived in my building for over 11 years. Seven years ago, someone came into the building with no paperwork, no authority, nothing, and took over the building, and has harassed and beaten and did everything under her power, claiming that she is a former NYPD employee. Her name is Christine Jordan. She has done nothing but domestically terrorized us in the building, shut off electricity, shut off water. I just got back electricity two days ago. I was without electricity.

I have taken this matter to the DA's office, Alvin Bragg. The case has been going on, and the case has been here, Gale, since you were Manhattan Borough President, and nothing has happened. It has been years.

(02:02:16)

A hundred years ago. Yes.

(02:02:19)

Ma'am, but the good thing is that we want an investigation to go in, because I have been assaulted, my sons were assaulted and arrested, and these people were given protection. Now they have warrants out for her. She has never been arrested. This is my face — a concussion. They kicked in the door and busted my face. I ended up three days in the hospital. This is domestic terrorism.

I filed with the Division of Human Rights office, and finally we have a case number 10229414-7. It says here that on July 27, 2023, Katie Presley filed a complaint with the New York State Department of Human Rights, charging the above, which is Christine Jordan, the respondent, with unlawful discriminatory practice relating to housing because of age, creed, origin, disability, et cetera. After the investigation, the Division has determined that in its jurisdiction in this matter, there is probable cause to believe that the respondents have engaged or are engaged in unlawful discriminatory practice.

So they have been found guilty, and I would like for this committee to look into the deed theft, because this individual has no right over this building and it is still going on. I just got back. I have a disability and this has affected my entire life. Thank you very much. It is not relevant, obviously, to the topic, but deed theft is a big issue for this Council, so we will be in touch.

(02:04:02)

Thank you. Go ahead. Thank you very much. Good afternoon, Chair Brewer and the members of this Council on this important committee. My name is Jamal Henderson, and I am honored to be of service as the New York City Regional Council Chair of Citizen Action of New York, which is a proud grassroots organization that is fighting for everyday New Yorkers as well as building community and political power.

Citizen Action of New York supports the fair and timely implementation of the Pied-à-Terre Tax and urges the Council to support the City's efforts to ensure the tax is implemented. As you all know, New York State suffers from the greatest economic inequality in the entire country. The data shows it time and time again, and despite having one of the largest economies, New York State has a long history of underinvesting in state programs and services, which has disproportionately hurt working class communities, more explicitly Black and Brown communities. New York State is home to the highest concentration of wealth in the country, and the deepest economic inequality. New Yorkers worth over 30 million, which is fewer than 0.4% of the population, collectively own $6.7 trillion in wealth.

This particular tax we are focusing on the second home, not the primary home, and this particular revenue can bring up to $500 million. Think about the youth and young adults that are getting ready to go back to school to have little to no after-school programs. Think about our public schools in our communities that are still waiting for funding to help improve the lives of our young people. Think about our seniors who are no longer looking for trips and food, but looking for prescription drug policies and resources to help them get by. Let us think about the infrastructure of those who, like myself, live in and are proud to be part of the moving, shaking economic foundation of this City. Let us think about all of those who are proud immigrants who call this City home and are working tirelessly to make sure that they are able to make ends meet. This tax revenue will help the everyday New Yorkers that are in your district.

I want to close with this. We, the people of New York, and members of the Council who represent us — you cannot allow the few millionaires and billionaires in our City to dictate over 8 million plus everyday, hardworking, educated people of this City. We are tired of it. Please stand with the people. Thank you.

(02:06:49)

Can you hear me? Great. Thank you so much for your time. My name is Brava Ranga, the campaign manager with Invest in Our New York. We are the statewide coalition of over 80 organizations representing thousands of New Yorkers and millions more who support our issue, fighting for state level legislation to tax the ultra wealthy and most profitable corporations in order to fund our communities. This year we campaigned for progressive revenue, and while we did not win everything that we wanted or that New Yorkers needed, we supported and continue to support the Pied-à-Terre Tax as an important step forward to generating the revenue needed to maintain the City's fiscal health and enact new programs to address the affordability crisis.

This tax on second homes would only affect the wealthiest homeowners, many of whom own second, third and fourth homes valued at over $5 million, which would raise $500 million to fund critical programs from housing to schools to sanitation. The ultra rich are making more money than ever before. Income inequality is continuing to widen and New York remains the most income unequal state in the country. These ultra rich residents of our state just received a $12 billion annual tax cut from the federal government on the back of slashing our health care, our food assistance and our support for housing. The ultra rich can afford to buy multimillion

(02:08:20)

dollar second and third homes, while the rest of us are struggling just to survive. Most New Yorkers cannot afford their rent, their groceries, their child care or their utility bills, and we know we deserve better. That is why we have built so much momentum for taxing the rich to keep our existing government services open and fund Mayor Mamdani's wildly popular affordability agenda.

But the rich are fighting back. They are launching bad faith attacks on the Pied-à-Terre Tax, weaponizing the courts, taking advantage of this hearing process to ramp up opposition and criticizing its implementation. They are doing this because they do not have valid criticisms of the substance of the law and they know they are losing the political battle. Poll after poll shows that super majorities of New Yorkers support taxing the rich to keep our existing services open and enact new ones to address the affordability crisis. Mayor Mamdani was elected with a mandate to enact his affordability agenda by taxing the rich.

I am heartened to hear that the majority of the Council supports this tax. I urge you to not let this hearing process be taken advantage of by a few bad faith actors. I urge you to implement the tax with all due haste and to be effective governing partners with the Mayor so we can enact his affordability agenda, keep the City's fiscal health intact and ensure New York is a place where all of us can thrive. Thank you.

(02:09:48)

Thank you very much. And thank you to this panel. Next is Jack Bone and Robert Bertaghani.

(02:10:12)

Sorry. Go ahead, sir. Can you hear me?

(02:10:17)

Thank you, CM Brewer, for convening this hearing. My name is Robert Bertaghani. I have come here to talk about the implementation of the Pied-à-Terre Tax. My wife and I purchased our home 30 years ago. We raised our family there. We have filed taxes as New York City residents for decades. My driver's license, voter registration, tax records and property records all provide readily available evidence that we are New York City residents.

Yet last month, I received a letter from my government telling me that my family will be subject to over a $52,000 annual Pied-à-Terre Tax unless I apply for an exemption and convince the City that the tax does not apply to me. The letter effectively said we presume you owe this annual $52,000 — now prove that you do not — and it will be at the sole discretion of the executive branch to determine whether you should pay the tax. Every New Yorker should be appalled by this underlying principle. The expansion of socialist state power rarely begins with government announcing that it intends to control the lives of its citizens. It happens incrementally. Government assumes a little more authority, citizens surrender a little bit more privacy, and the burden gradually shifts from the government justifying its actions to citizens being required to justify themselves to the government. Each new intrusion is then defended as reasonable, necessary and insignificant. That is precisely why this episode troubles me.

Yet even as the coercive nature of this rollout became clear, the Mayor has continued to defend it. His willingness to defend and encourage this kind of prototypical socialist government intrusion should alarm each and every one of us. This is not simply about whether one supports or opposes an anti-free-market tax. It is about whether New Yorkers are prepared to accept an authoritative government that is allowed to selectively target certain citizens and require them to prove that the government should leave them alone. I urge the City Council to provide the essential check on the Mayor and ensure that this type of outrageous government intimidation of its citizens does not happen again. Thank you for listening.

(02:13:00)

Thank you very much, sir. I appreciate it. Now we are going to go to the people who are testifying via Zoom. Elizabeth Valdez is first, followed by Ryan Foley. Elizabeth Valdez, go ahead, you may begin.

(02:13:19)

My name is Elizabeth and I am an advocate with Brooklyn Center for Independence of the Disabled. We are a disability-led organization living and working with people with disabilities to live the fullest life possible in the community of their choice. We support increasing funding for many essential services, supports and systems used by people with disabilities and others here in New York. We especially support innovative progressive taxes that can bridge New York City's budget shortfall and support programs that will benefit disabled New Yorkers and all of us.

The tax being considered today would raise $500 million in desperately needed funding by taxing the residences of those who can afford to contribute to our social safety net. As you know, the federal government wants to slash funds from the social safety net in order to deliver the wealthiest Americans a massive tax break. So the tax under discussion today would allow us to take back a small portion of that lost revenue to benefit programs that will help the rest of us. Funding from Albany has also been used to expand child care for two and three year olds, only in this tremendously expensive City, and the pre-K expansion has already directly benefited disabled children who need additional services and, of course, relieved their parents as well.

This is one step towards making New York City a far better place to live for everyone. I would be remiss if I did not note that the City and State face real challenges in delivering home care and health coverage for all. Care workers struggle to make ends meet. Family caregivers provide hours of unpaid care, and people with disabilities struggle to find the care that they need. The home care crisis only continues to grow as our population ages and more and more people need long term care. At the same time, over a million New Yorkers will lose their health insurance by next year due to Medicaid cuts in the federal budget, and we are expecting even more cuts to health care in the next year's budget. You find yourselves facing tough choices about taxation, but ultimately this comes down to priorities. Someone will pay for these budget cuts. Will it be those who own high-priced second homes in New York City, or will it be home care workers, family caregivers, older adults and people with disabilities, paying the cost in services, hours and wages? The tax being considered today is a significant first step in addressing the

(02:16:20)

Thank you very much. Next, we are going to go to Ryan Foley, followed by Shannon Richter.

(02:16:29)

You may begin. Thank you. Good afternoon. My name is Ryan Foley. I am senior counsel at the law firm Starr Associates, where we represent sponsors and developers of condominiums across the City. I want to raise an initial point or two before I get to the substance of my message. I would like the record to reflect a rejection of the characterization that people here today, spending two and a half hours waiting to talk about the utter failures of the implementation of this tax, are bad actors. I will set aside and will not focus any of my time on the substance of the policy, which I do have views on, but that is not the purpose of this hearing. To characterize anyone coming with concerns or criticisms of the implementation as bad actors is simply false.

Before I get into the substance, I also want to mention that I have heard a lot from this body today about everyday New Yorkers versus wealthy or second and third home owners in New York. Again, that is irrelevant. Every New Yorker deserves fair tax implementation. So I want to now dive into

(02:17:42)

the issues that we have seen at our firm. One is the letters. The notice letters the Department sent were sent to everybody. They were the same letter. It is important to recognize that the statute contains two entirely different concepts. Under the definitions, there is covered property and there is excluded property. Now, when you talk about covered property, the primary residence exemptions and some of the things we have heard today come up. But what we have not heard at all today is excluded property. Under Administrative Code Section 11-321, there are exactly two categories of excluded property under the surcharge. One of those, and the focus of my comments, is unsold residential units that are subject to sale under an offering plan with the Attorney General. Those properties should never have made it on the list in the first place. They are easy to track. They are registered under the condominium declaration filed with the City of New York, and the City has all of the deed transfers. So anything that would have appeared as a unit that has not had a deed transfer should never have made it on the list anyway.

But it did not matter. All of the letters that went out went to everybody, including the sponsor entities that hold the unsold inventory as well as the buyers of new development that, as of January 5, 2026, the date on which the surcharge takes effect, would have been excluded property. The fact that everybody, including people that purchased or hold unsold condo units, still received these notices is...

(02:19:34)

Time expired. Thank you very much. Next, we are going to hear from Shannon Richter and then...

(02:19:46)

Hi. My name is Shannon Richie. I have lived in New York City for nearly 20 years. I am raising my son here and I fully support the Pied-à-Terre Tax. It feels a bit strange to even need to write and speak on this issue, and the wealth disparity in our City is so apparent. You all see it every day. As a public school teacher in Brooklyn, I have students who lived in family shelters learning alongside students who lived in waterfront penthouses. Some kids would travel to far island resorts during winter break while others I would send home with extra snacks, even gloves and hats that I swiped from last year's lost and found, because I was worried a week away from school meant they would go without such necessities. These disparities, at least in the area where I taught and still live, are only becoming more and more glaring, and we are seeing them here as people testify complaining about the second homes that they own here in New York City and having to pay slightly more in their taxes. I am not going to give you my sympathy.

Towers are going up along the river sitting empty. Luxury condos sell for millions and no one actually lives there. Maybe I am nosy, but it is hard to miss that the new big glass boxes behind my apartment with soaring ceilings and tons of natural light sold for eye-watering prices and now they just sit empty. Occasionally someone will come to clean and draw the curtains, but it is an insult that I witness daily as my husband and I search rental listings, wondering how much longer we can afford to live in this neighborhood that we have called home for decades. A Pied-à-Terre Tax feels like an obvious way to fund our most necessary public needs. The wealthy will barely notice the difference.

(02:21:27)

At most, it will be a footnote from their tax consultant.

(02:21:30)

The children who can now attend a well-funded after-school program instead of riding the bus for hours until their mom gets off work, they will notice. The teacher who does not need to cut into her food budget to buy pencils and notebooks for empty backpacks, she will notice. The proposed $500 million will change so many lives for the better. We voted for this, we canvassed for this, and our City deserves this. Please stop platforming the ultra-wealthy and those who can be bought by them, and listen to the actual New Yorkers who live here and make this City what it is.

(02:22:07)

Thank you. Next up is Allison Clem.

(02:22:11)

Hello, everyone. My name is... I am a housing and health community organizer at the Center for Independence of the Disabled, New York. We are for people with disabilities in the five boroughs of New York City. Thank you for giving us an opportunity to testify today. We strongly support the Pied-à-Terre Tax.

We appreciate the City's effort to implement the surcharge, which addresses affordable and accessible housing challenges. It is very disturbing that the Mayor's administration did not show up to testify. I am asking the Mamdani administration to establish a clear priority for accessible housing investment. The City should increase the number of affordable and accessible apartments designed and constructed for people with mobility, vision and hearing disabilities. Current policy requires that 7% of certain affordable housing units be set aside for people with disabilities. The administration should examine whether the percentage set aside for people with disabilities is sufficient given the housing needs of New Yorkers.

We are asking the City to collect reliable data on accessible units and applications to identify unmet demand and then use that information to increase supply. Regarding the transparency of the implementation of the surcharge, we hope that the administration will be fair and just in requiring all wealthy homeowners who mostly do not live in their homes to pay the taxes without any exception. We hope everything proceeds as projected to bring in more than $500 million. We are urging the City to strictly dedicate that money to more affordable and accessible housing for people with disabilities. Thank you. I will submit my written testimony.

(02:24:32)

Thank you very much. Next is Allison Clem, and then Valerie Mason. Allison Clem, you begin.

(02:24:41)

Hi. My name is Allison Clem. I am a new parent living in Brooklyn. I have lived in New York City for 15 years. I met my husband here and we are now raising our son here. I want to be clear about why we are here today. It is not because a list of already public information was aggregated and published online. It is not because 17,000 people who are lucky enough to own high-value homes have to upload documents. Anyone who is trying to apply for unemployment, food stamps, WIC or Medicaid knows that it takes many hurdles, countless hours on the phone and dozens of documents to prove eligibility for services they need to survive. So I believe in every homeowner's ability to upload that.

You know, once upon a time there was a big book that got sent to everyone with people's addresses and phone numbers. So this hand-wringing around the list feels quite silly. But these concerns about the list go to show how wealth inequality is harmful even to those at the top. I propose that taking measures to address that inequality would go a long way towards relieving that anxiety. We are here to talk about a tax on second homes worth $5 million and more for nonresidents, so I am not sure why any New Yorker, regardless of their tax bracket, would oppose this. Many must have been committing tax fraud, claiming residency elsewhere to avoid New York income taxes, for which I have no sympathy. None of this applies to average New Yorkers. Most average New Yorkers are renters and most of us are rent-burdened. This tax will raise necessary City revenue from

(02:26:00)

people who use our City as a playground and keep valuable excess real estate as a tax shelter or an asset to profit from. As a new parent navigating a lot of uncharted territory, I am preparing to go back to work and figure out how to incorporate childcare costs, which is nearly a second rent payment and an albatross around our necks. Childcare costs are a severe burden on too many New York City families, which is why universal childcare was such a motivating factor in last year's mayoral election. The revenue generated from this Pied-à-Terre surcharge should go towards making universal childcare a reality, which would lift a huge burden on working class families. We are priced out of the City because of cost. We do not have a second home, luxury or otherwise, to retreat to. As a millennial who will likely never be able to own a home, let alone multiple homes in New York City or elsewhere, I urge the Council to prioritize the millions of poor and working class New Yorkers whose survival will be made easier from the money raised by the surcharge. Thank you.

(02:26:56)

Thank you. Next is Valerie Mason. You begin.

(02:26:59)

Hello. My name is Christopher... I oppose the rollout of the Pied-à-Terre Tax. Make no mistake, this tax is nothing but a way to make sure that corrupt nonprofits and organizations have to work for people, getting paid to give a mayor that is penalizing success. And that is not right. If you work your butt off, you deserve every fruit of your labor. This is a mayor that does not believe that people who are successful should reap the rewards of their success. The problem with these organizations that were outside City Hall Park this afternoon is that they are professional parasites. They are professional grifters that only care about getting paid through donations, and they do not understand what it means to do your work to get a paycheck.

As I said before, this is nothing but a scam to line the pockets of nonprofits. This does not affect a person that is on Section 8. It does not affect the person that is on food stamps. It does not benefit them at the end of the day. No matter what, even if this tax is not implemented, Section 8 will always be supplied because that is political suicide for any politician in New York City. So no matter what, this is just a scam. Shame on the City Council for supporting this tax, and I appreciate every member of the City Council that has opposed this tax. I said before this tax should not be permitted and I hope that the high court says that this tax is unconstitutional. It is a broadly unconstitutional tax that penalizes people and it really hurts people from doing better in the City, because why would you want to own a home here where you will be taxed to help others.

If I am successful, I deserve to be able to buy three cars. If I am successful, I should not be penalized for having three phones. This is ridiculous. This mayor and his nonprofits are just jealous of people who are making money. They are just mad at the next person. It is starting to be about pocket-watching. That is what they are doing. Shame on the City Council for allowing that to happen. And a lot of these guys are not men, because men do not pocket-watch. This should be an anti-pocket-watch year in this administration, because this administration is more about pocket-watching instead of finding a way to line the pockets of people directly. Just because you are part of nonprofits lining pockets does not mean that your party is effective. This is ridiculous. I do not like it at all. I am disgusted by this whole process. I do not support it. I believe in free capitalist commerce. If you work, you eat. Like the Bible says, a man does not work, does not eat. And that is the problem with the City. They enable lazy people. They want to water lazy people while people have busted their backs and done the work. So thank you.

(02:30:00)

Thank you very much. Next is Valerie Mason. You begin.

(02:30:07)

Thank you. Good afternoon, Chair Gale Brewer. I am not here to talk about the tax per se. I am here to talk about the fact that this is an oversight committee and that no mayor, nor his or her commissioners, are above the law. They should come and testify, and the Council has subpoena power. I know the statement that you read, Chair Brewer, said that they would come after the thirtieth. I did not know that people have the right to tell you when they were going to appear to talk about what they are doing. I think that this sets an extremely bad precedent, and I would hope that the City Council does everything in its power to make sure that the administration is responsive to any oversight inquiries that you have.

On an additional note, I echo what was said very early on in the public testimony today about how co-ops are going to be able to respond to this. I think this should have been part of the initial hearing when the tax was being implemented. I do know people who are scrambling now to show that their properties are either investment properties. It is hard to ask a tenant to show you proof of an electric bill or residency when it is not in your lease and they are not compelled to provide that kind of information. So the fact that this goes back to 2025 seems rather like a retroactive tax. I know that this was deemed necessary because we are going to find out we had a $500 million budget gap, but I think that we should all be New Yorkers. The testimony here is really disheartening today. It shows that people are trying to fan the flames of discord amongst people who live in New York City and that should not be. There were 900,000 people on that list, many of them erroneously, and that should not be how the government of the greatest City in this country operates. I am calling for more transparency, and the Department of Finance should come forward and stand behind what it did. If they made a mistake, they should be able to say it out loud. New Yorkers should be able to rely on their government, and I just think this is an extremely bad precedent that is being set by this administration. Thank you very much.

(02:32:44)

Thank you very much. Now Charlie is going to read a statement from one of our colleagues, CM...

(02:32:51)

Great. So thank you so much. This statement is from CM Joann Ariola. She could not be here and we do not have a forum for her to say it over Zoom, so I am reading it on her behalf. Thank you, Speaker Menin, Chair Brewer and colleagues for hosting this hearing, as well as all who have come to testify. As mentioned by my colleagues and many of those who testified, the Department of Finance published a database covering roughly 900,000 plus properties' valuations. The City says the underlying property information was already public, but I argue that compiling the list and making it easily accessible subjects the people on that list to appearing to be potential tax targets. That creates substantially different privacy and security concerns. It can incorrectly label people as tax cheats or wealthy targets. Additionally, this database may be misinterpreted by the public into believing that if a person is on the list, it must mean they owe the Pied-à-Terre Tax. That is potentially damaging to the integrity of innocent homeowners. Publishing

(02:33:52)

the names and locations of people associated with, and in some instances wrongly identified as owning, very expensive properties can create obvious concerns such as burglary and targeting, stalking or harassment, political intimidation, scams, identity theft and unwanted media attention. It also puts the burden of proof on the homeowner and will cause them to incur legal costs to prove what they already know: the home listed is their primary home. The disrespect the mayor has shown the Council, the committee, this hearing and the residents of the City by not showing up tells me that they could not defend their actions. So again, that is a statement that I just read from CM Joann Ariola for the record. Thank you.

(02:34:32)

Thank you very much. Now we are going to, as quickly as possible, read the questions that would have been asked of the Department of Finance and the Tax Commission. I am going to start with number one and we will go back and forth, Charlie and I. So the public list on the website, which we all heard about, has 900,000 residential properties, the ones below the market value criteria established by State law, while the list of properties that received notices included 17,000 properties. We have heard these questions. Why is the list of properties receiving letter notices and the published property list different?

(02:35:11)

Is the published property list information similar to the publicly available property tax assessment roll data that Finance publishes as required by the State Property Tax Law? What are the reporting and public notification requirements based on State law? State law requires the phase-one market value records of covered properties to be open for public inspection while separately requiring Finance to make initial non-primary residence determinations. Can you explain how Finance interpreted and implemented these two separate requirements? Does Finance believe that its public reporting and notification process satisfies the requirements established by State law, and are there any changes Finance plans to make to that process going forward? There were certainly a lot of suggestions here today. The public list posted on Finance's website indicates the properties on the list may not be subject to the tax.

(02:36:23)

How can owners verify if they need to file an exemption? According to analysis by former Finance Commissioner Martha Stark, a beloved person to all of us, when the more than 900,000 properties on Finance's published list are filtered using the statutory market value thresholds, approximately 24,000 properties remain. Why did Finance not apply those thresholds before publishing the list, so that the public-facing list more clearly reflected the universe of properties that could potentially be subject to the tax? Despite those 24,000 properties remaining on the list after this initial screening, Finance sent out 17,000 letters. What accounts for the difference between the two?

(02:37:14)

Prior to mailing out the letters, did Finance conduct an analysis of how many individuals on the list had filed taxes in 2025 listing New York City as their primary residence? If so, how many residents were mailed letters? Okay, next set of questions.

(02:37:32)

For the past 30 years, the City has published annually lists of properties that are eligible for the City's tax lien sale. Recognizing that elevating a list like this creates a target for predatory actors, the City's practice had long been to publish the bare minimum necessary. The lessons from that do not appear to have been followed here. The list published did not only include names but also properties that would qualify for the tax due to the value of the property. Why did the Department of Finance ignore its own practices in terms of publishing the bare minimum? The owner name is not needed for the lien sale. Why is it needed here? Why publish a list that includes properties whose market values come nowhere near the statutory minimum value required to be subject to the tax, rather than clearly distinguishing those properties from the much smaller universe that could actually be subject to the tax? What steps is the Department taking now to mitigate confusion or potential misuse of the information that was published? Number three...

(02:38:35)

Number three: on the Department of Finance website there is a checklist to determine if taxpayers need to file an exemption for this tax. The checklist directs taxpayers to the exemption filing process without first verifying whether their property meets the market value thresholds. A: why does the eligibility process not begin by clearly determining whether the property meets the applicable market value threshold before directing an owner to the exemption filing process? B: considering the published list includes over 900,000 properties, including homes valued by Finance as lower than five million dollars and condo units lower than one million dollars, how can residents who are on the Finance published list be confident that they are not required to file an exemption?

(02:39:29)

Next question. Number four: the Department has acknowledged that the published list is not a list of properties subject to the tax. Approximately how many, and what percentage, of the properties on the published list do you expect will ultimately not be subject to the tax? Did the Department estimate the false positive rate before publishing the list, and if so, what was the estimated rate? What quality assurance procedures were performed before publication? And looking back, would the Department have published the same list again?

(02:40:00)

Number five: former Finance Commissioner Martha Stark has recommended, as you heard earlier, several steps Finance could take to address the problems with the rollout. Does Finance agree with the following recommendations and does it intend to implement any of them going forward? A: publish a list limited to properties that meet the statutory market value thresholds, while making clear that meeting the threshold does not necessarily mean that the tax applies. B: provide property owners with more specific notices explaining why their property was not initially identified as a primary residence and what documentation they need to submit based on their circumstances. C: create an online tool that allows property owners to check whether Finance has identified their property as subject to the tax, potentially without requiring the code provided in the mailed notice.

(02:40:57)

The next set of questions is on primary residence determinations. The City already administers multiple programs that require proof of primary residency. A: why must homeowners prove residency again if they already received the cooperative and condominium property tax abatement? B: to evaluate automatically exempting homeowners already verified through existing programs. And C: why was information already possessed by the City not leveraged to reduce unnecessary...

(02:41:24)

...burden. Seven: the State law allowed Finance to make an initial determination of primary residency based on information available to the Department. Despite this, longtime residents received a letter from Finance...

(02:41:37)

...asking why the burden to prove primary residency is left to longtime residents when Finance already — this has been asked a lot today —

(02:41:45)

...had information to determine...

(02:41:48)

...which properties would be exempt from the tax based on other filings, in relation to STAR, the veterans exemption and the condo co-op abatement. B: what were the criteria used by Finance for determining that latter list? C:

(02:42:04)

Did Finance utilize any other exemption data that would indicate primary residency, such as STAR or co-op and condo, to avoid sending letters to constituents that are known to the Department as primary residents? D: State law expressly authorized information sharing...

(02:42:23)

...between the State and the City for purposes of implementing the tax. Did Finance request information from the State to identify owner occupancy prior to sending the letters? If yes, when, and how was it incorporated into the determination? If no, why not?

Regarding the 17,000 properties that were notified: how many of the owners received the abatement, veterans exemption, STAR or other benefit for which primary residency is required? Of the owners who have already successfully established primary residency in response to the letter notice, how many were already receiving one of these benefits? How many have responded so far? Of those, how many has the Department of Finance determined are not subject to the tax? C: how many applications remain pending? D: how many have been denied? How many of the properties does the Department currently estimate will ultimately be subject to the tax? How many of the initial determinations were based on affirmative evidence that a property was not a primary residence versus an absence of information demonstrating it was a primary residence? G: can you provide this Committee with the list of 17,000 properties that mailings were sent to? And H: can you provide this Committee with a sample letter that was sent to the 17,000 properties, including any different notices used for Class 4 properties, condominiums and cooperatives?

Notice and public outreach. Nine: it appears that Finance is relying on mailings to notify owners about this tax, and the only way to confirm that a property may be subject to the tax is to have received a letter. However, mail does get lost. It is not unusual for Finance mailing addresses to be out of date, although some of that is the responsibility of the owner. A: how many notices will Finance be mailing each affected owner? B: how can an owner who did not receive a notice from Finance determine whether Finance never sent one or whether it got lost in the mail? C: how many notices have been returned as undeliverable? Are there other ways Finance is contacting these owners? And: State law says for notice to be transmitted by electronic means when practicable. Why was electronic notice not practicable for this year's implementation, and does Finance intend to provide notices electronically in future years?

Number ten: why is there nothing on the landing page or under its news and updates about the Pied-à-Terre Tax? It should be there in a very prominent and noticeable way.

Submissions for exemptions. Eleven: the Department recently expanded the deadline to file an exemption from August to September 18. Do you believe this is an adequate time? A: how will Finance handle late filings of exemptions? B: is this administration comfortable with imposing the tax on a primary resident homeowner if they end up missing the deadline by one day? C: what if they had been hospitalized? D: what if they missed the deadline by a few weeks? E: can you commit to allowing people to continue to prove their residency even past the deadline, maybe allow for an extension where there is good cause for a late submission, and whether to not require those who missed the deadline to pay a late fee, which would encourage people to file before the deadline but not face the full tax if they missed the deadline? People have mentioned that people might be in the hospital.

Who can file documentation for an exemption? A: can an authorized person other than a covered owner submit proof of primary residency on behalf of a covered owner who is 65 or older? B: what about for condo and co-op unit owners — can the managing agents file the paperwork on behalf of a covered owner? And C: can an owner of a joint live-work quarters for artists unit apply for an exemption, and under what criteria?

Thirteen: there are homes in gentrifying communities throughout the City with market values that have now begun to exceed five million dollars. Some of them have been in the same hands through generations. While the values of the homes have soared in recent years, residents of these homes are solidly working class and are subject to many pressures. One of those results is unclear titles when a prior owner passes away without a clear will. In those cases, heirs have a claim to the title of the property but the deed has not been legally transferred to the heir. This creates a dynamic where it may be difficult to document primary residency. In these circumstances, are there any mechanisms in place to assist these longtime residents with filing an exemption?

Fourteen: residents have asked what documents are sufficient to establish primary residency. A: what documents does the Department consider the strongest evidence? B: can taxpayers rely on the same documentation used for STAR, the veterans exemption or the cooperative condominium property tax abatement? C: can electronic records be submitted? D: to evaluate conflicting documentation. E: what opportunity will an applicant have to cure an incomplete application before the Department issues a denial?

Fifteen: how is Finance dealing with homes that are held by LLCs? What is the process to ensure that these individuals who have property are determined as having primary residency in the City?

Sixteen: State law provides authority to audit within six years of any certification or documentation of primary residency submitted as proof of exemption. Given the potential penalties for inaccurate or misleading submissions, did the Department communicate to the property owners any document retention requirements for information that was used as proof of primary residency?

Seventeen: could you clarify the process for Council offices assisting constituents with filing exemptions? We were informed at the Department of Finance full session on August 4 that cases could be submitted through the new Department of Finance case management portal. A week later, we were informed we should follow the exemption process outlined in the letter, despite many constituents being unable to do so. Can we email the necessary documents directly to the Department of Finance on behalf of constituents who come to our offices? We have been told that the Department of Finance is unable to accept paperwork that way, but many constituents cannot use the online portal. Will Finance commit to promptly letting Council offices know whether exemptions have been approved or denied for cases that we have reached out on?

Eighteen: constituents have shared concerns about the privacy and security of documents they have to submit to file for the exemption. Could you clarify how these documents are stored and the process for deleting them?

Implementation for cooperative units: property tax and market value information for co-ops are at the development level, while this new tax has a market value threshold at the co-op unit level. This makes it difficult for individual co-op unit owners to determine if they are required to file an exemption. How can co-op unit owners determine if they need to prove primary residency? C: what type of outreach and assistance is provided by the administration to assist co-op unit owners? For instance, is Finance working with the co-op and condo managing agents to assist with exemption applications?

And this is about the appeals process. Number twenty: many homeowners are concerned about being incorrectly identified as subject to the tax. If a homeowner's exemption is denied, A: what rights exist? B: what is the timeline for filing exemptions and appeals? C: will there be an independent review? D: can taxpayers submit additional documentation after an initial denial? E: will penalties and interest accrue while an appeal is pending? F: is information about appeal rights included in determination letters? And the Department of Finance website states that if an owner chooses to have the Tax Commission review the initial primary residence determination, the owner must also challenge the property's...

(02:50:53)

...market value and cannot submit proof of primary residency to the Department of Finance. Why are property owners required to choose between these two processes, and how has the Department communicated this distinction to affected...

(02:51:05)

...owners. Thank you very much, and I want to thank also Speaker Menin and all who attended and the staff. These questions will be submitted to the administration. In addition, we have questions along with those from the New York City Co-op and Condo Coalition. They too will all be submitted and we would like answers to all of them. Thank you very much. This hearing is...