Grocers issue warning over Mamdani’s taxpayer-backed stores: 'We're going to go after' them
Private operators looking to run New York City’s planned government-owned grocery stores are being put on notice: Join Mayor Zohran Mamdani’s program, and grocers fighting the plan say they could face you in court.
"We’re going to go after any operator that’s in there," Frank Garcia, who is leading a coalition of immigrant-owned grocers challenging the city’s plan, told Fox News Digital in an interview Monday.
"We’re hoping that no one puts the RFP."
Garcia, chairman of the Multicultural Business Coalition, was referring to New York City’s request for proposals seeking private operators to run the five taxpayer-backed grocery stores Mamdani has proposed. Under the program, selected operators would receive city-backed space while agreeing to sell a core basket of groceries at prices 30% below typical New York City retail prices.
The Multicultural Business Coalition filed two lawsuits against the city Monday, arguing the taxpayer-backed stores would unfairly compete with minority- and immigrant-owned businesses already operating on thin margins. Garcia said the coalition now intends to extend that legal fight to private companies that sign on to operate the stores.
GROCERY BOSS WARNS MAMDANI'S CITY-RUN STORES PIT GOVERNMENT AGAINST 'ITS OWN CITIZENS'
The threat comes as the city moves from pitching the concept to trying to find companies willing to run it.
The New York City Economic Development Corporation formally opened the operator RFP in July and is seeking up to five companies to operate the stores. Proposals are due Oct. 16.
Mamdani has said the five stores, one in each borough, are expected to open by 2029. The administration says shoppers would receive a fixed 30% discount on a basket that includes fresh produce, meat and seafood, along with staples such as milk, bread, cheese, pasta, rice and beans.
Existing grocers, however, argue they would be forced to compete against stores insulated from costs they have to shoulder themselves, particularly rent.
Mamdani has pushed back on claims that the municipal stores would put neighborhood bodegas out of business, pointing out that the city-backed locations would not sell products such as cigarettes, alcohol, lottery tickets or hot foods — revenue streams that can help sustain smaller neighborhood stores. The mayor has also pointed to public-market models such as Essex Market as evidence that subsidized markets and private businesses can coexist.
"I’m confident in both the legality of this – that it will stand up in court – and the importance of delivering it," Mamdani said in a news conference on Monday.
Asked what he was doing for bodega owners who worry about losing business, Mamdani said: "What we can do is continue with our approach citywide of looking for ways to cut costs and cut the regulations that so many bodegueros, as well as grocery store owners, have to jump through in order to do their work. What we have already found through our OPEN Task Force is already the identification of more than 50 potential changes that target things from the current necessity of having two different licenses to sell hot food and cold, dairy frozen dessert. As well as the kinds of things that make it harder for bodegas to both sell items outside of the store and inside of the store."
The mayor’s office declined to comment on Garcia’s claim that his coalition sought a meeting with Mamdani and did not respond to his threat of litigation against participating operators.
Garcia said his coalition sought a meeting with Mamdani before going to court but was rebuffed, alleging the mayor instead met with a group of Dominican business owners while leaving out other immigrant and minority-owned businesses that could be affected by the plan.
"He’s putting our minority businesses against minority businesses," Garcia said.
Garcia repeatedly invoked the immigrant history of New York’s bodegas, describing businesses that have passed through generations of Puerto Rican, Dominican, Mexican and other immigrant entrepreneurs.
His coalition, he said, represents a broader cross-section of those businesses, including Latino, Korean and Arab store owners.
City officials have also wrestled with how to support existing grocers that fear they could lose business to the taxpayer-backed stores.
Waverly Neer, a senior vice president at the New York City Economic Development Corporation who leads the NYC Groceries initiative, recently said the agency was considering grants and other incentives that could accompany the municipal stores and support independent businesses in surrounding neighborhoods.
NYCEDC later said grants were not currently under consideration but that the agency was exploring other forms of assistance, including potential tax abatements, incentives and zoning benefits through existing city programs.
MAMDANI’S CITY GROCERY PLAN COULD LEAVE TAXPAYERS PAYING FOR EVERY BANANA
Garcia argues the city should put more of its resources behind businesses that already exist.
He said some immigrant-owned bodegas in his coalition have struggled to access affordable capital and turned instead to private lenders charging steep rates.
"A lot of these bodegas are paying 35% loans right now to predator lenders," Garcia said.
His criticism was not reserved for Mamdani or Democrats.
Garcia said Republicans have also "hurt us," pointing to federal restrictions affecting access to Small Business Administration-backed loans for green-card holders, while arguing elected officials across the political spectrum have failed immigrant entrepreneurs seeking affordable capital.
But Garcia saved his sharpest political criticism for Mamdani’s democratic socialist allies, saying the coalition intends to mobilize against the movement as its fight over the grocery stores expands.
"We are creating a path to go after the DSA," Garcia said.
Garcia insisted the coalition is not simply asking the city to abandon its effort to bring down grocery prices.
Instead of creating new city-backed competitors, he said grocers have proposed forming a buying group that would allow independent stores to purchase goods directly from manufacturers, cutting out middlemen and lowering participating stores’ costs.
"We have other solutions," Garcia said. "Work with us to create that."
SIGN UP TO GET THE POLITICS NEWSLETTER
Garcia said the coalition believes the city could use existing minority-business programs and its purchasing power to expand the model, allowing private neighborhood stores to lower prices without forcing them to compete against rent-free municipal stores.
"Why not work with us to create that?" Garcia said. "Work with the supermarket association."