The pied-à-terre tax may not be dead after all.
Though the bill to impose an additional tax on pricey second homes in NYC was shut down in the New York state legislature in the spring, State Sen. Brad Hoylman, who first introduced the proposal in 2014, will continue to push for the legislation, The Real Deal first reported.
“It’s still of great interest I think to my colleagues—I’m continuing to carry it,” Sen. Hoylman told The Real Deal. “I hope to have a bill that’s ready for prime time as it were.” Hoylman added that he’s pushing for the bill to go to the floor by the start of the Senate’s January session.
The bill, which would impose a tax on non-primary residences with a market value of $5 million or more, failed to gain support in the spring following fierce opposition by the real state industry, who argued that it would depress real estate values. Instead, lawmakers included a “progressive mansion tax” in the state’s 2020 budget.
The “mansion tax,” which went into effect in July, is imposed on properties valued at $1 million or higher and is expected to generate $365 million a year, to be put in a dedicated “lockbox” for the MTA. As far as the pied-à-terre tax, supporters say it could generate at least $665 million for the city every year.
“I think the overall issue is that a lot of New Yorkers believe a lot of nonresident wealthy owners of condos… aren’t paying their fair share,” Hoylman told The Real Deal. Hoylman also said he hopes the tax could help fund affordable housing or education.
The piece of legislation is currently in the Cities Committee, and its chair, Sen. Robert Jackson, has expressed his support as an opportunity to fund public education, The Real Deal says.
The pied-à-terre tax gained traction earlier this year when Hedge fund billionaire Ken Griffin bought a 220 Central Park South apartment for a record-breaking $238 million. Given the fact that the pad was not meant to be his primary home and that the city is facing an affordable housing crisis, several politicians, including Gov. Andrew Cuomo, supported the tax proposal at the time.
Correction: An earlier version of this piece said the mansion tax would be imposed on properties valued at $25 million or more, but the tax is imposed on those valued at $1 million or more. Curbed regrets the error.