The regulations surrounding food cart vendor permits has led to a black market that leaves many vendors — mostly working class immigrants — earning less than minimum wage, according to a report from Crain’s. New York City only allows 3,000 legal permits for food carts and trucks, and the law prohibits people from selling their permits. To get around it, a black market has formed where vendors pay the permit holders thousands of dollars a year for the right to operate — a market that’s worth as much as $20 million. The permit only costs $50 to obtain legally. The result: What was supposed to be a way for new immigrants to become entrepreneurs now keeps them stuck working for measly salaries for years.
The Crain’s report looks into all the aspects of the black market. A real estate office in Astoria advertised the food vendor cart and permit for sale. An expediter must be paid to help food vendors navigate the bureaucracy of renewing a license. Permit holders, when they're ready to retire or switch jobs, collect money "like a pension," though they’re by no means rich. Most of the sales happen through meetings or Craigslist.
Prices of permits have been going up — a two-year permit for a food truck can cost as much as $30,000 — partly due to increased regulations from the city, such as laws requiring permit holders to address health department ticket. Street vendors have protested recently to push the city to offer more legal permits, which would minimize the expensive black market. But many people oppose the move, including local business district that see mobile carts as clogging the sidewalks. City agencies also do little to curb illegal permit transfers.
Meanwhile, many of the vendors themselves feel stuck in the role and end up with little financial stability. "What else am I going to do?" one vendor who had been working for 27 years tells Crain’s. "Who’s going to hire me? I’m not an electrician." See the full report here.