Food Carts Fuel Black Market

March 9, 2011  |  

(Wall Street Journal) — Monawara Sultana says her rent is going up: $14,000 for a two-year permit to run a food cart where she sells $1 hot dogs outside of Montefiore Medical Center in the Bronx.  And it’s not the city levying the increase or recouping the money. It’s the permit holder, who is asking for double what she previously paid, according to Ms. Sultana. “It’s not fair,” said the Bangladeshi immigrant and mother of three. “Why did it go up so much?”

The city’s competitive street food culture has created a thriving black market for mobile food vending permits issued by the Department of Health and Mental Hygiene. The city charges a mere $200 for most food-cart permits, which must be paid every two years when they are renewed. But it only issues 3,100 year-round permits plus an additional 1,000 seasonal permits—not enough to satisfy demand. Transferring or renting these permits to another vendor is illegal but everyone, including the city’s Health Department, acknowledges, that it happens.  Two years ago, the city’s Department of Investigation did an undercover probe of improper permit transfers, which led to six arrests. The department recommended, among other things, that the Health Department move to a competitive sealed-bidding process to help “eliminate the criminal conduct found in the investigation.”

Elliott Marcus, an associate health commissioner, said the black market was a source of “big concern.” Still, in a statement, the Department of Health noted: “While the Health Department suspects that in some instances permits are being transferred illegally, it is extremely difficult to prove an illegal sale in a particular case because the law does allow a permit holder to employ other licensed vendors to work his or her cart.” To help remedy that, the department will soon propose changes requiring that permit holders appear when renewing permits and carts are re-inspected every two years.

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