New York City Regs Strangling Street Food Vendors

Reason magazine contributing editor Michael Moynihan has an important article in the Wall Street Journal (June 18, 2011) logging the confusing, costly, and anticompetitive regulations New York City has imposed on food cart vendors in the city. Unfortunately, the full article is only available to subscribers, but Moynihan does a nice job of showing how byzantine these rules can be and the fundamentally anticompetitive nature of those adovcating for the rules. Michael writes:

“It’s no surprise that the mayor who required fast-food restaurants to display the caloric content of every menu item would declaim food trucks. But while New Yorkers barely reacted to calorie counting with a shrug, the popular haute-cuisine trucks, where the adventurous eater can find gianduia-flavored ice cream, Korean “tacos,” and BBQ pulled pork Belgian waffles, is a rather different matter.

“The business of selling street food doesn’t lack for regulation. In Manhattan—and most cities in the U.S.—the legal proscriptions governing food trucks are baffling, and the barriers to entry for new businesses predictably onerous. To sell food cooked in a truck, one must possess a vendor license. But the city caps these at around 3,000, with a waiting list just as long. And with sometimes as few as a dozen new licenses dispersed in a year (via a lottery system), for most this means waiting a dozen years to start a legal operation.

“Baylen Linnekin, executive director of Keep Food Legal, a Washington, D.C.-based advocacy group devoted to “culinary freedom,” says that the regulatory hurdles faced by truck owners ensure the creation of an underground economy. Because the City Council has so limited the number of permits, often “the only way to open up a new truck is to pay a bribe and buy a permit on the black market.” While it’s technically illegal to resell permits, Mr. Linnekin estimates that over half the city’s trucks either “rent” or purchase permits, which can cost upwards of $20,000.”

Reason Foundation has researched this issue extensively in cities across the nation. One of more thorough studies is Giving a Let Up to Boostrap Entrepreneurship where we examined local regulations in Boston, Atlanta, Los Angeles, and Dallas. We’ve also used taxicab regulation to demonstrate the perverse and highly political nature of these local regulations (see here and here).

Samuel R. Staley, Ph.D. is a senior research fellow at Reason Foundation and managing director of the DeVoe L. Moore Center at Florida State University in Tallahassee where he teaches graduate and undergraduate courses in urban planning, regulation, and urban economics. Prior to joining Florida State, Staley was director of urban growth and land-use policy for Reason Foundation where he helped establish its urban policy program in 1997.

Staley is the author of several books, most recently co-authoring Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century (Rowman & Littlefield, 2008). Texas Gov. Rick Perry aid Staley and Moore "get it right" and world bank urban planner Alain Bartaud called it "a must read for urban managers of large cities in the United States and around the world."

He is also co-author, with Ted Balaker, of The Road More Traveled: Why The Congestion Crisis Matters More Than You Think, and What We Can Do About It (Rowman and Littlefield, September, 2006). Author Joel Kotkin said, "The Road More Traveled should be required reading not only for planners and their students, but anyone who loves cities and wants them to thrive as real places, not merely as museums, in the 21st Century." Former U.S. Secretary of Transportation Mary Peters said, "Balaker and Staley clearly debunk the myth that there is nothing we can do about congestion."

Staley's previous book, Smarter Growth: Market-based Strategies for Land-use Planning in the 21st Century (Greenwood Press, 2001), was called the "most thorough challenge yet to regional land-use plans" by Planning magazine.

In addition to these books, he is the author of Drug Policy and the Decline of American Cities (Transaction Publishers, 1992) and Planning Rules and Urban Economic Performance: The Case of Hong Kong (Chinese University Press, 1994).

His more than 100 professional articles, studies, and reports have appeared in publications such as The Wall Street Journal, The New York Times, Washington Post, Los Angeles Times, Investor's Business Daily, Journal of the American Planning Association, Planning magazine, Reason magazine, National Review and many others.

Staley's approach to urban development, transportation and public policy blends more than 20 years of experience as an economic development consultant, academic researcher, urban policy analyst, and community leader.

Staley is a former chair for his local planning board in his hometown of Bellbrook, Ohio. He is also a former member of its Board of Zoning Appeals and Property Review Commission, vice chair of his local park district's open space master plan committee, and chair of its Charter Review Commission.

Staley received his B.A. in Economics and Public Policy from Colby College, M.S. in Social and Applied Economics from Wright State University, and Ph.D. in Public Administration, with concentrations in urban planning and public finance from Ohio State University.