A coalition of immigrant-owned grocers has filed lawsuits against New York City over Mayor Zohran Mamdani’s plan to open five taxpayer-backed grocery stores, alleging unfair competition. The Multicultural Business Coalition filed two lawsuits on Monday, arguing the program would undercut existing small businesses operating on thin margins.
The city’s Economic Development Corporation opened a request for proposals (RFP) in July to select private operators for the stores, which are slated to open in each borough by 2029. Selected operators would receive city-backed space and be required to sell a core basket of groceries at prices 30% below typical New York City retail prices. Proposals are due October 16.
Legal Threats Against Operators
Frank Garcia, chairman of the coalition, stated in an interview with Fox News Digital that operators participating in the program could face legal challenges. "We're going to go after any operator that's in there," Garcia said. "We’re hoping that no one puts the RFP."
The coalition’s lawsuits claim the city’s program would violate fair competition laws by using public funds to subsidize government-run stores. The administration has not yet responded to the legal filings.
City Defends Program as Anti-Inflation Measure
Mayor Mamdani’s office has framed the initiative as a response to rising grocery costs, stating the stores would provide fixed discounts on essential items such as fresh produce, meat, seafood, milk, bread, cheese, pasta, rice, and beans. The city has not specified how the program will be funded beyond the initial taxpayer investment.
The New York City Economic Development Corporation confirmed the RFP remains open, with up to five companies expected to be selected. The first stores are projected to open in 2029, pending operator selection and construction timelines.
Background: The Grocery Store Plan
The program was first announced as part of Mayor Mamdani’s broader economic policy, aimed at addressing food insecurity and high retail prices in underserved neighborhoods. The city has not yet released a detailed budget for the initiative, though officials have indicated subsidies will cover startup costs and operational losses.
Critics, including Garcia’s coalition, argue the plan could distort local markets and disadvantage existing grocers who cannot compete with subsidized pricing. Supporters, including the mayor’s office, contend the stores will fill gaps in food access where private retailers have not met demand.
The legal and operational timeline for the program remains uncertain as the city reviews proposals and the coalition pursues its lawsuits.