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California Dodges A Vacant Grocery Store Tax — For Now

California policymakers are dangerous not only to their neighbors but to the entire country because their ideas are often adopted by imitators in state houses and city halls. Plastic bag bans. Overbearing climate regulation. Draconian COVID rules. A crusade against condiment packets. 

Almost added to that list is a punishment for retail chains that dare close their stores. One San Francisco city supervisor, Bilal Mahmood, had hoped to tax shuttered grocery stores and pharmacies, because, in his view, “no San Franciscan should be forced to choose between long walks, expensive rides, or going without basic necessities.”  

Had Mahmood had his way, the fall San Francisco ballot would have included a pair of measures, the Abandoned Pharmacy and Grocery Tax Ordinance and the Affordable Grocery Fund. His aim is to address the city’s outbreak of “zombie stores.” 

Mahmood, apparently inspired by New York City Mayor Zohran Mamdani’s plan to open city-run grocers, and city bureaucrats planned to spend the new source of dollars on an affordable grocery fund that would convert corner stores into “full grocery stores that sell fresh produce” or hand out “grants that can help support worker co-ops or family-owned businesses.” 

An additional possibility was to use the money to buy property and lease it to “affordable grocery stores.” 

Mahmood pulled the idea over the weekend, which had polled well but didn’t have the support of wiser city officials.

That Mahmood would even consider a vacant store tax shows that, like so many other elected officials across the country, he’s oblivious to pertinent facts. The reality that grocers have to live with every day, that theirs is a competitive business with historical profit margins of about 1%, simply escapes him.

While grocers struggle, Mahmood rails about “both food inflation” and a “food crisis” that he is certain are afflicting San Francisco. 

“Everyone deserves access to fresh food, prescription medications, and everyday essentials close to home,” said Mahmood, who promised his scheme would “help transform” the “empty stores blighting our commercial corridors back into healthy businesses supporting our neighborhood.”

Never mind that San Francisco is the fourth wealthiest city in the world and ranks behind only New York City in the number of billionaire residents — 58, according to Forbes — in the U.S. It’s not a city brimming with hordes that don’t have the resources to move around freely. 

Nor is there a “food crisis” by the Bay — grocery purchases as a share of the median income in San Francisco are a mere 1.22%, far lower than in cities such as Detroit (3.78%), Cleveland (3.77%) and even Birmingham, Alabama (3.28%). “Strong household earnings make groceries feel lighter in California,” says the Visual Capitalist. 

But it is a city that has allowed crime to become so pervasive that many retailers have chosen to close their San Francisco stores rather than keep them open for the convenience of criminals. 

The city escaped a grave policy error. Had the proposal been approved by voters this fall, the message of hostility would have been clear to any grocery or pharmaceutical retailer that thought it might open or expand in San Francisco. It’s an incentive killer.

As currently constructed, California’s single-party political class seems often unable to learn, which means Mahmood’s idea could return at any time in any city. It would be foolish to think it won’t.

— Written by the I&I Editorial Board

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  • I&I writes: Bilal Mahmood, had hoped to tax shuttered grocery stores and pharmacies, because, in his view, “no San Franciscan should be forced to choose between long walks, expensive rides, or going without basic necessities.”
    I also don’t believe San Franciscans should not be forced to choose between intelligent representation and dunce representation.
    So when does Mahmood resign?

  • Mahmood and so many other loopy elected officials are in office only because millions of misinformed, naive, uneducated and far too young voters elected them. Easy to blame the Mahmoods, the Mamdanis, the creepy crawly Democratic Socialists and other weirdoes of our recent era, including my city’s City Council in this line-up of loopy officials, too, but our own voters voted them all into office; democracy!

    How can we refine our democracy? How do we have voters who will strengthen and protect our cities, states and nation, instead? Just breathing, as an 18 year old, is not good enough to be a voter for the responsibilities of our country.

    Raise the age to vote, require first time voters to pass a thoughtful Civics Exam, show your ID, and make sure elections are honest, fair and impossible to corrupt, as they might be now with so many loose, bizarre, new fangled methods to vote.

    We can and must to do much better!

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