San Antonio—Earlier this year, government agents showed up at Rafael Lopez’s business unannounced and told him that he had to shut down immediately, or face fines of up to $2,000 per day. Why? Because Rafael’s business—a taco truck called El Bandera Jalisco, which he parked on private property along Broadway Street—was operating within 300 feet of a brick-and-mortar restaurant. The agents told Rafael that his only chance at reopening was to get permission from the neighboring restaurant. A few days later, Rafael walked over and asked for permission, the restaurant refused, and Rafael was forced to close for good.
Rafael’s story is all too common. That is why, today, a group of San Antonio food truck owners have partnered with the Institute for Justice (IJ) to challenge the city’s unconstitutional law in court. The lawsuit challenges the city’s 300-foot rule as a clear violation of Texans’ right to economic liberty—the right to earn an honest living free from unreasonable government interference.
“No one should need their competitors’ permission to run a business,” said IJ attorney Arif Panju, who is lead counsel for the food truck operators. “We wouldn’t expect a mom-and-pop hardware store to get permission from Home Depot to open down the street, and for the same reason, we shouldn’t expect food truck owners to have to get permission from restaurants. The 300-foot rule does nothing to help consumers; it is used to help restaurants eliminate their food-truck competition.”
For more than a decade, San Antonio has banned food trucks from operating within 300 feet of restaurants and other businesses that serve food, such as convenience or grocery stores. As a result, there are thousands of government-created “no-vending zones” spread across the city that make it difficult to open or operate a food truck. This is true for food trucks operating on private property that they own or lease, as well as those using legal public parking spaces.
To have any chance at operating within these no-vending zones, food truck owners must first get a written and notarized permission slip from each brick-and-mortar food business. The 300-foot rule does not prevent restaurants from demanding money in exchange for their permission—and these permission slips can be revoked without notice, something that immediately forces food trucks to shut down.
“The government should be protecting the public from actual harm, not protecting restaurants from their mobile competitors,” said Matt Miller, Managing Attorney of the Institute for Justice’s Texas Office. “We’re confident that the courts will see this law for what it really is: an egregious example of unconstitutional economic protectionism.”
The plaintiffs in this case illustrate the real costs the law has for food truck entrepreneurs across the city. Rafael is joined in the lawsuit by three other food truck owners:
- Regino Soriano owns a popular food truck named El Bandolero. Soon after opening for business, San Antonio told him he had to shut down. He is only able to operate because he permission to do so from a nearby restaurant, which he could lose at any time, forcing him to shut down. He also had to abandon expanding his business at a second location, because it was situated within 300 feet of three restaurants.
- Bernardo Soriano, Regino’s 24-year-old son, owns and operates El Bandolero II, a food truck on the north side of San Antonio. He vends on private property off of US Highway 281 and wants to grow his business by vending at private events all over San Antonio, something he is prohibited from doing if the event is within 300 feet of a restaurant or other food establishment.
- Ricardo Quintanilla operates Tacos el Regio on private property along Nacogdoches Road. Unfortunately, a cloud of uncertainty hangs over his business. Across the street from his food truck sits a vacant commercial property. If a restaurant moves in, Ricardo will be forced to shut down his food truck.
“You have to look no farther than Austin or El Paso to see the positive impact food trucks and street vendors have had on a city’s economic vibrancy,” said Panju.
According to Upwardly Mobile, a new report released today by the Institute for Justice in conjunction with the lawsuit, food trucks, food carts and other street vendors are more than just a pitstop for a tasty taco—they are a vital economic engine that fosters vibrant streets, creates economic opportunity and supports jobs. The report finds that many vendors in large cities are more than just sole proprietors. In fact, 39 percent of vendors are employers. Of those, they have on average full time 2.3 employees and 2.7 part-time employees.
“San Antonio should be encouraging small business owners like us, not trying to hurt our food truck businesses by playing favorites,” said IJ client Ricardo Quintanilla.
The government cannot use its power to pick winners and losers in the marketplace. This June, in a landmark ruling in another case brought by the Institute for Justice, the Texas Supreme Court decided Patel v. Texas Department of Licensing and Regulation and made clear that economic liberty—the right to earn an honest living free from unreasonable government interference—is a vigorously protected right under the Texas Constitution.
“Laws like San Antonio’s that harm food trucks in order to protect brick-and-mortar establishments from competition are unconstitutional, and we aim to put a stop to them–both in Texas and across the country,” said Bert Gall, a senior attorney at the Institute for Justice who directs its National Street Vending Initiative, a nationwide effort to vindicate the right of street vendors to earn an honest living. IJ is filing today’s lawsuit and releasing Upwardly Mobile as part of this initiative. IJ is no stranger to fighting anticompetitive food truck laws. In 2011, IJ filed a similar lawsuit in El Paso, which had a 1,000-foot rule in place. The city quickly backed down and repealed the law. IJ is also currently litigating a similar proximity ban in Chicago, which prohibits vending within 200 feet of a fixed business that serves food.