An organization dedicated to reforming New York’s notoriously byzantine property tax system has filed a motion against the city over its assessments for the upcoming fiscal year, arguing that they blatantly disregard a 2024 ruling from the state’s highest court.
The Court of Appeals last year revived a 2017 lawsuit from Tax Equity Now New York that challenged New York’s property tax system. The group had argued that the current system violates the state’s real property tax law and federal fair housing law by overtaxing rental properties compared to owned homes and by overtaxing communities where most residents are people of color. The court ruled in a 4-3 decision that both arguments could proceed.
But Tax Equity — a coalition that includes property owners, renters and civil rights groups — claims in its new motion (filed as part of the 2017 case) that the city has disregarded this ruling. If successful, the motion would make the city redo its latest round of property tax assessments, which officials released earlier this month, said Martha Stark, policy director for Tax Equity.
“Despite the city’s expressed desire to make the city more affordable for hardworking homeowners and renters, they are ignoring their ability to do just that in the area where they have the most control: the property tax,” she said in a statement.
Tax Equity is seeking a summary judgment against the city, given that officials must notify property owners by Feb. 20 if their assessment has increased and by how much. If the court does not issue a judgment before then, thousands of property owners will have to pay taxes based on improper assessments, Tax Equity argues.
The city violated the Court of Appeals ruling by overassessing homeowners in majority-minority and low-valued neighborhoods, according to Tax Equity. Officials also used rent-stabilized buildings as value comparisons for luxury condos and co-ops, which causes heavier tax burdens for cheaper outer-borough residences and lighter ones for luxury Manhattan residences, the group claims.
The city can fix these issues on its own without legislation, but “it seems determined not to do so,” the lawsuit says. “Instead, it seems anxious to run out the clock.”
The city did not immediately respond to a request for comment. At the time of last year’s Court of Appeals ruling, former Law Department corporation counsel Sylvia Hinds-Radix stressed that the judges had said only that Tax Equity had the right to bring the suit, which was returned to a lower court following the decision, where it remains ongoing.
New York’s current property tax system dates back to 1981 and has been harshly criticized for years. Former Mayor Bill de Blasio’s administration was vocal about problems with it even as it ultimately declined to take major steps toward reform or support the Tax Equity lawsuit. A commission de Blasio formed to study the system did release a report shortly before the end of his second term with recommendations for reform that included removing growth caps on assessed values and establishing a new tax class for small residential property owners.
The city published its tentative assessment roll for fiscal year 2026, which starts July 1, in mid-January. It placed the market value of all properties at about $1.6 trillion, a 5.7% increase year over year. The market values for condos, co-ops and rental apartment buildings were projected to rise by 7.3%, while the market values for office buildings were projected to rise by 2.7%, according to the Department of Finance.
