People shop at a grocery store in Brooklyn on May 13 in New York City. Photo / Getty Images
Among the many buzzy campaign promises that helped Zohran Mamdani clinch the New York City Democratic mayoral primary last month, one has spawned confusion and heated debate: municipal-owned grocery stores, which he says guarantee cheaper prices, especially on staples, as a response to soaring inflation.
Under his proposal, the city would run a pilot project to set up a network of stores, one in each of the five boroughs, with a subsidy of US$60 million ($100.9m), he explained in an interview with News 12 New York. These stores would also be strategically located in “food deserts” so communities with few grocery options have more choice, especially for fresh and healthy food.
The idea isn’t new. A handful of rural towns have opened such stores, some large cities have announced plans to do the same and major cities like New York have had publicly run or subsidised food retail options for decades.
“The need is clear for more affordable food in New York City,” said Nevin Cohen, a professor at the City University of New York Graduate School of Public Health and director of the CUNY Urban Food Policy Institute. “We have 1.5 million New Yorkers who are food-insecure. Nearly half of households with children are at risk of food insecurity, and groceries … are more expensive [here] than in other cities in the US.”
Still, there are few success stories to point to. These stores have often struggled in small towns: a municipally owned store in Baldwin, Florida, closed last year after five years of operations, after it kept losing customers to a Walmart about 12km away, WTLV reported.
The proposal has also drawn fierce political opposition. Mayor Eric Adams, a former Democrat who is now running as an independent, said on Fox News that Mamdani’s plan “is not the right thing to do” and would “devastate the local bodegas and the local stores and the local supermarkets”.
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These stores, in theory, are funded and operated by the city, occupying public buildings and staffed by government employees. But in practice, municipalities often partner with private businesses or nonprofits to manage operations.
In interviews and TikTok videos, Mamdani has not specified what model he would propose, and his campaign did not respond to multiple requests for details. But in his videos and podcast interviews, he has referenced the stores as a “public option” – like a library – but “for produce”. He has also vowed to sell products at wholesale prices, cutting out the razor-thin margin grocers make on their sales.
Yes, but only a handful are still operating, mostly in rural areas, said Rial Carver, programme leader at the Rural Grocery Initiative at Kansas State University. So far, the city governments in Madison, Wisconsin and Atlanta have announced plans for such stores. Chicago was also close to a deal but shelved the plan this year.
The majority of these stores involve a public-private partnership, in which the city either owns the property or offers tax incentives to a local grocery business or nonprofit. This support helps “minimise the risk of opening and operating a store”, Carver said. She noted grocery stores require a healthy amount of upfront capital to pay for fridges, freezers and shelving equipment, as well as salaries, merchandise and technology fees. Plus, it can take years for a store to become profitable, she said.
A combination of philanthropy, city dollars and sales revenue is “the secret sauce to keeping these grocery stores alive”, said Erion Malasi, director of policy and advocacy for economic security for Illinois at the Economic Security Project, who worked on the proposal for Chicago’s city-owned store.
Some cities also have government-subsidised markets, in which private vendors can sell their produce in a well-maintained, low-rent space, Cohen said. These public markets have been in New York City since the 1930s, and there are currently six across four boroughs.
The most prevalent comparison, though, is military commissaries, which are entirely government-owned and run as nonprofits, with the proceeds invested back into the stores, Cohen said. Prices there average about 18 to 25% below what private supermarkets charge.
Proponents say these stores provide affordable, healthy food options, especially in low-income neighbourhoods that may lack access to supermarkets. They also address food insecurity as grocery prices – which have risen more than 28% since 2020 – continue to climb. Analysts also expect groceries to continue to get pricier as tariffs hit US food supplies.
“It is a government tool to better the community,” Malasi said. Instead of offering tax cuts to national chains to incentivise them to open in these communities – with no guarantee they will stay – governments can directly “deliver to our neighbourhoods”, he added.
City-owned grocery stores also boost local economies, particularly in poor rural and urban areas, Carver said. They provide jobs, services and access to fresh and healthy foods while making a town or neighbourhood more attractive to new residents and other local businesses.
But Carver has seen this option as a last resort after “several other avenues have been pursued and not worked out”. Those include persuading an independent operator or national chain to come to town or a local entrepreneur to invest in a store. Some localities also try co-operatives, where locals all own a piece of the store and sometimes contribute labour.
While Mamdani’s plan envisions selling at wholesale prices, those may still not be affordable. Getting a below-market deal on a wholesale price is an enduring struggle for independent grocers, which is one reason their prices are higher than those of their national-chain rivals. A city-owned store would face the same challenge, said Uriyoán Colón-Ramos, associate professor and director of the Diet Disparities Lab at George Washington University’s Global Food Institute.
Then there is competition from warehouse stores, big-box and supermarket chains, which order at a higher scale and can apply pressure on suppliers to shave prices, analysts say.
“The challenge with being competitive in your pricing doesn’t necessarily go away with this model,” Carver said. “There are still costs that go into operating a grocery store that don’t fundamentally change if it’s a municipally owned grocery store.”