Not So Mobile: How Local Protectionism Curbs Food-Truck Entrepreneurs
In cities across the country, mobile food vendors have radically transformed the way Americans eat and work. Food trucks provide entrepreneurs a lower-cost, accessible alternative to a traditional brick-and-mortar restaurant while offering consumers incredible and affordable variety, often in previous “food deserts” where dining options were limited or nonexistent.
Despite these important contributions to local communities, food truck entrepreneurs face some of the worst examples of economic protectionism, ranging from New York City’s permit system, which limits how many mobile vendors are allowed to operate, to many cities’ bans on operating in particular locations or during certain hours. These requirements aren’t designed or even intended to protect public health and safety, but instead seek to prevent food trucks from competing with existing restaurants.
The result is predictable. In places like New York City, a secondhand market for leasing mobile vending permits has emerged, resulting in exorbitant prices that can reach tens of thousands of dollars. 1 Luis Murua, for example—a vendor who sells hot, caramelized nuts in Manhattan—paid $24,000 every two years to rent his permit prior to the pandemic. 2 Many of these secondhand licenses can obscure actual ownership, making it harder for regulators to enforce other health and safety measures.
Cities that restrict vending locations or times aren’t any easier to operate in. Telling an entrepreneur that they can only operate their business far away from the parts of town where people are likely to gather, or severely limiting their operating time to 30 minutes (less time than it takes many vendors just to park and begin working), both have the same effect as an outright ban.
On top of all that, state and city health officials often make it unnecessarily difficult for certain kinds of entrepreneurs, like returning citizens, to enter the food truck industry. Forms for permits often ask about an applicant’s criminal history—and even though street vending is especially popular among immigrant entrepreneurs, government resources are often difficult to navigate or unavailable in vendors’ native languages. 3
In many cities, vendors may give up after repeated, unsuccessful attempts to navigate outdated or overly burdensome local requirements that don’t fit the needs of food truck owners and customers, and simply operate without a license.
Instead of fearing innovations like food trucks, local policymakers should consider revisiting the way they regulate mobile food vending in their city. Embracing the flexibility, diversity, and opportunity that food trucks provide is a win-win-win for vendors, customers, and local officials.
Luis Murua operates Nuts4Nuts, a food cart on the corner of 5th Avenue and 46th Street in New York City. Since 2006, Luis has manned this corner and sold warm, caramelized nuts to office workers and tourists. “It’s tough working a cart like this, but I love working for myself. I stopped working during the pandemic when New York City was a ghost town and worked in a warehouse for a bit. The work was good, but I missed being my own boss. When things started to open again, I was back out here working the cart.” Originally from Mexico, he took after his father by starting his own business and working for himself.
But to do that as a vendor in New York City is incredibly difficult. New York City caps the number of mobile vending permits at 5,100 citywide. And while recently-passed legislation increased the number of available permits, relief for vendors like Luis is still out of reach. With the waitlist for permits over a decade long, Luis rented his permit from another vendor for a whopping $12,000 a year, or $1,000 a month. “It’s expensive. But I make it work. I’ve got rent to pay and have to support my family.” Fortunately for Luis, his monthly payments were reduced during the pandemic. But for other vendors, they are not as fortunate and continue to pay exorbitant prices for the right to operate their vending businesses. New York City could provide immediate relief to thousands of vendors by removing the caps completely, allowing vendors to obtain their own permits and provide in-demand goods to their communities while supporting themselves and their loved ones.