Food Trucks: Run Off the Road by Regulation

by Anna McCuan, Age 16
Submitting Teacher: Melinda McCuan

In the past few years, food trucks have emerged as an icon of the hip downtown movement. However, many entrepreneurs who thought that a food truck might be a good way to steer clear of the extensive regulations surrounding commercial kitchens have been sorely disappointed. In some cities food trucks have become entangled in a complex web of licensing and inspection procedures. In particular, the City of Chicago has passed strict municipal codes which severely limit how food trucks may operate. Ostensibly, these rules are to improve public food safety but are actually used as a tool for more influential restaurateurs to limit competition. One such rule in Chicago requires a distance of more than 200 feet between where a food truck may operate and the business entrance of a brick and mortar restaurant. This rule unfairly hurts food truck owners, limits consumer choice, leads to monetary drain on the City of Chicago, and doesn't keep us safer.

Starting a food truck requires considerable investment. In addition to all the necessary kitchen appliances, each food truck is required by the City of Chicago to have a three compartment sink with a grease trap, a permanent divide between the driving and the cooking areas, and a class 2 fire suppression hood. One is also required to pass numerous inspections and obtain a business license, a fire safety permit, a commercial drivers license, a mobile food vendors license, a mobile food preparers license, a food sanitation managers certificate, and a food handlers license. Each license can cost up to $1000, a considerable sum for a start up. In this low margin sector of the food service industry, where many make less than $20,000 per year, the government mandated expenses are extremely overbearing. As John Stossel put it in his recent TV special "War on the Little Guy," "At a time when unemployment is high our government attacks people who want to work and stops people from starting businesses."

Each food truck is also required to have a GPS which operates 24 hours per day and transmits the truck's location every five minutes. While this may seem to be an unnecessary feature, it is required by the city to make sure food trucks comply with the 200 foot rule. For one violation a food truck can be fined up to $2000.

The added government bureaucracy needed to monitor the food trucks' distance from restaurants is an extra expense for the taxpayer of Chicago. In addition, police personnel spend time checking food trucks' locations and less time patrolling crime-infested areas.

Furthermore, in many critical markets in downtown Chicago, there simply aren't 400 feet between each restaurant. According to the Institute for Justice there is almost nowhere in the downtown Loop area where a food truck could lawfully sell food. The 200 foot rule is devastating to the business of food trucks because they are not allowed to operate in prime locations.

Consumers have also complained that the regulation decreased the number of food choices in downtown Chicago. Some, who found the fare served by food trucks fresher and better tasting than that found in local restaurants, are now forced to drive to the outskirts of town or eat less healthy food nearby.

Other cities, such as Austin, Texas and Portland, Oregon have vibrant food truck communities. Neither of these cities have any rule similar to Chicago's 200 foot rule, but there have been no adverse health effects reported.

Why then was this law passed?

In the 1990's, after food trucks started to gain popularity, Chicago restaurants began to view them as a threat to their business. Strict rules were passed which allowed no cooking on board trucks. After public clamour on behalf of food trucks became more pronounced, the mayor and city aldermen decided to loosen their regulations, which were among the most restrictive in the nation. Mayor Rahm Emanuel hailed the new bill, Chicago City Code 7-38-115, as a great boon to food truckers, saying, "The food truck industry in Chicago has been held back by unnecessary restrictions, and my administration is committed to common sense changes that will allow this industry to thrive, creating jobs and supporting a vibrant food culture across the city."

While the bill did improve some things for food truck owners, allowing them to cook on their trucks, some of the "common sense changes" had little to do with helping the over regulated food truck industry. Buried deep within was the 200 foot rule. This rule was obviously intended to limit the number of locations food trucks can operate in Chicago.

The true intent of the bill was recognized by Alderman John Arena who cast the sole vote against the bill, calling it a "restriction of trade". As it turns out, the Illinois Restaurants Association worked with the Mayor's office to produce the new law. Rather than improve their service, create a more pleasant indoor environment, or make tastier food, the restaurants of Chicago lobbied for protection. As Alderman Arena put it, "A brick and mortar restaurant lobby got ahold of [the ordinance] and it was stuffed with protectionism and baked in the oven of paranoia."

Interestingly, in other cities which have far greater numbers of food trucks, restaurants and food trucks peacefully coexist. Indeed, a news article from the Austin American-Statesman reported that restaurateurs and economists in Austin generally agree that the rise of food trucks has led to a boom in the city's restaurant industry. Chicago's restaurants may actually be hurting themselves by eliminating their competition.

The 200 foot rule clearly illustrates how regulations on the free market have unintended consequences for everyone involved. It is also an example of how regulations restricting the free market often devolve into tools to benefit special interests. The message is clear: businesses should succeed or fail based on how good their products are, not on who they know at city hall.