Bethlehem’s Awful Food Vendor Ordinance May Get Worse Somehow

Lynn Olanoff says Bethlehem city council may be about to make the city’s anti-competitive food vendor ordinance even worse, which is pretty amazing given how awful it already is.

The changes would restrict mobile vendors to operating between 10am and 6pm on Monday – Saturday, and 12am – 3am on Thursday – Saturday. Food vendors will not be allowed to move their carts to a different location to reach potential customers:

Morales, a city resident who has run a hot dog cart in Bethlehem since July 2010, told city officials he was unsure about his permitted hours and had kept late night hours every day of the week except Sunday. He is only permitted late night hours Thursdays, Fridays and Saturdays.

Morales also has moved his cart to locations other than his permitted spot outside the former First United Church of Christ, city officials said. He had wanted the city’s permission to operate his cart outside the Tally-Ho Tavern on Monday and Wednesday nights but city officials turned down his request Thursday night.

This is really insane. 6 pm? How can you take away the whole dinner hour from a food business? What could possibly be the reason for doing that?

“I think operating from 12 until 3 o’clock those three nights are wrong,” said Tina Kowalski, who owns the Funhouse bar on East Fourth Street. “The whole evening is about the vendor … and I don’t see any compromise with the merchants.”

The merchants! Yes, even though the Funhouse doesn’t sell hotdogs, and Chris Morales doesn’t sell booze, somehow he is…stealing business from them. Personally I think beer and hotdogs go great together, but to each his own.

Look, this is just rent-seeking. Even if Chris Morales was directly competing with the Funhouse, selling exactly the same things as them, right out in front of their bar, there’s no case for the government to step in and reduce competition. Some day another bar might open next door to the Funhouse and directly compete with them. Should the city step in and stop that? Of course not. Competition is great, and there is not a legitimate public interest in making the bar and restaurant market less competitive.

The original food vendor ordinance is bad, and these changes are even worse. Vendors should be allowed to sell food at whatever times they think they can make money, and they should be allowed to set up wherever they want and go to where the customers are. It is not in the public interest to restrict their hours, or create barriers to entry, just because some business owners don’t like competition. I can’t imagine the government agreeing to blatantly restrict competition between brick-and-mortar businesses in this way.

It’s perfectly sensible to require mobile food vendors to get a business license and a health permit, and pay the same business privilege taxes as brick and mortar businesses, but that’s it.

People should be allowed to open a food vendor business as-of-right. They shouldn’t have to get approval from city council or property owners. They should definitely be allowed to move their carts to wherever the customers are. If Chris Morales can make more money operating in front of the Tally Ho some nights, and the Funhouse on other nights, the city shouldn’t stop him from moving. Allentown gets this part of their food vendor ordinance right, only requiring vendors to leave 5 feet of sidewalk clear for pedestrians at all times. No approval from property owners is required.

That’s not to say Allentown’s ordinance is great. It has its own protectionist problem, where vendors offering a similar product as an existing brick-and-mortar business aren’t allowed to set up within a 2-block radius. Just like with the proposed 6 pm cut-off proposed in Bethlehem, this is purely for the benefit of rent-seeking incumbent businesses and serves no legitimate public interest.

Instead of making the law stricter, Bethlehem city council should take this opportunity to streamline the process, and get rid of the anti-competitive restrictions on hours, mobility and the number of vendors.

Comments

  1. Rich says:

    Why would anyone rent a building and run a place if it was so easy to just put a cart out on the street and sell the same stuff. I think he’s lucky he’s allowed at all.

    • John says:

      Rich, the sad fact is Jon is anti-small business and he always has been. If you go back through his archives you’ll see countless blog posts to that effect.

    • Jon Geeting says:

      John, this is the most pro-small business post ever. A food cart is one of the smallest businesses imaginable. My point is that there is no legitimate public interest being served by limiting competition here.

      I don’t buy that people wouldn’t open traditional businesses if the cart option was easier. Despite the fact that there are ice cream trucks, plenty of brick and mortar ice cream shops continue to exist, even in places served by the ice cream trucks. It would also not make sense for many different kinds of food sellers to use a cart. The decor is a big part of the Italian restaurant business model, for example. There are advantages to having a physical building for many kinds of restaurants. We’re really talking about a small segment of the restaurant market, and that’s the market for street food – stuff where the price point is lower. That’s where overhead really matters and you’re going to see the most deadweight loss from over-regulating. There are not any good reasons for a city government to regulate these kinds of businesses out of the market. Food trucks and food carts are getting very popular right now and governments should encourage this.

  2. Kelly says:

    Ice cream trucks are constantly mobile. They dont park in front of a tax paying place of business and undercut there sales. ice cream trucks also only sale premade items while brick and mortar shops sale old fashion ice cream they make on site the truck is just a retailer they dont handle raw product its not like the hot dog carts putting there carts in front of say potts, yoccos, vassis, petes etc for example brick and mortar property tax paying businesses that put money back into the community. The ice cream trucks dont ask to operate on street corners in the early morning as well.

    • Jon Geeting says:

      By the way, street vendors have to pay the same business privilege taxes everybody else does. Property taxes are not the only taxes. If you think brick and mortar businesses’ property taxes are an obstacle to job growth, then argue for different taxes. I personally think financing local public services mostly through taxes on buildings is a terrible idea, and would prefer it if cities switched to some combination of land taxes and consumption taxes.

  3. Kelly says:

    Also you stated they should be allowed to sale food whatever time they want. The areas he sets up in are also residential and you should not be permitted to have a bunch of drunken buddys banging on an out of tune guitar badly under my bedroom window at 2am in the effing morning when people have to get up and go to work the next day……. yes ive seen it happen.

    • Jon Geeting says:

      Then police should enforce nuisance ordinances. Sorry, none of these are compelling reasons for the government to step in and stop people from opening street food businesses. This is capitalism at its best. There are plenty of good reasons for government intervention when there are real market failures, but this is not a market failure. It is just the market operating exactly as it should. Nobody is going out of business just because some food vendors are selling street food. Anybody whose business can’t withstand competition from some street vendors has a shitty business and deserves to go under.

Trackbacks

  1. [...] our opinion isn’t as strong as Jon Geeting’s, the city’s regulation needs to be stepped down considerably.  If a restaurant can be open 24 [...]

  2. [...] have the ridiculous requirement that mobile vendors selling similar foods to existing restaurants have to set up outside a 2 block radius from the competing business – a rule that would effectively ban all mobile vendors from the [...]

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