Our Recovery Must Center Street Vendors: What We Found Through an Analysis of the Street Vendor Emergency Fund
By: Lyric Kelkar, Data Analysis by: Prince Osemwengie, Fernando Abarca, Lyric Kelkar, Penelope Bernal
We all know what happened in March of 2020. As an organization that is dedicated to serving low-income entrepreneurs, we quickly pulled together the Street Vendor Emergency Fund (SVEF) to provide direct cash assistance to this group of people who are often left out of government aid. We have raised and deployed over $750,000 in assistance and look forward to raising more for these entrepreneurs. Through our application process, we received 2,653 unique entries from vendors hurting across LA. Through the application process, we asked vendors a number of questions to understand their situations better and get an idea of what they will need to recover. As far as we are aware, this is the largest set of information about vendors in Los Angeles. You’ll find a detailed analysis of what we found through these applications, and how our existing systems are set up to fail these entrepreneurs.
One thing is very clear, vendors are struggling, and in order for our economies to justly recover, they need to be centered in our steps forward toward reopening. Sidewalk vendors tend to be senior women, immigrants, many of whom do not speak English. Vending is an economic lifeline, and during the pandemic, that lifeline was stunted at best, and completely obliterated at worst. The information collected from the applications of the SVEF paints a harrowing picture of what needs to be done to truly support these entrepreneurs, their businesses, and the neighborhoods that they serve.
A Brief History of Legalizing & Permitting Sidewalk Vending in LA
The Los Angeles Street Vendor Campaign spent over 10 years of relentless advocacy to decriminalize and then legalize sidewalk vending in Los Angeles, culminating in an exciting vote by LA City Council in November 2018. Just two months prior, former Gov. Jerry Brown signed SB 946 into law, decriminalizing sidewalk vending across the state and building a framework for what local sidewalk vending programs can look like.
The City of LA decided that it would utilize the full year of 2019 to develop a permit system while standard spatial regulations were in place. On January 2, 2020, the first ever sidewalk vending permit in the City of LA was issued for $291. It was promised that there would be a six-month grace period for signing up with the new program, and that enforcement would only consist of outreach and education, and no citations for vending without a permit. Two months later, on March 17, 2020, almost immediately after the city shutdown for COVID-19, the LA City Council banned vending without a permit. Considering sidewalk vending had only just been legalized, and been open for permits for only two months, this meant the vast majority of vendors did not have a permit, and were de facto banned from working.
Fast forward a year and a half to today, and 1,809 sidewalk vending permits have been issued, only 165 of which are for food vendors (meaning all others are for merchandise vendors). This translates to 3.6% of the estimated 50,000 vendors in Los Angeles overall, and only 1.65% of the estimated 10,000 food vendors in LA being fully permitted.
Street vendors in the City of LA are split into two major categories: merchandise vendors and food vendors. In some instances, vendors sell both. The permitting process is painfully difficult to get through, as detailed in a report by Public Counsel and UCLA Law. The process for obtaining a health permit is especially cumbersome, complicated, and out of reach for the majority of vendors in Los Angeles. A permitted food cart is very hard, if not impossible, to come by for those who sell LA's most iconic foods - tacos, bacon-wrapped hot dogs, pupusas, and more. Commissaries are few and far between and the fees and time needed to be compliant are their own classification of barriers.
Even with the full legalization of sidewalk vending, it is still nearly impossible for food vendors to vend within current systems.
The Struggle of Vendors During the Pandemic
Sidewalk vendors were some of the hardest hit businesses during the pandemic. Their business relies on foot traffic, and they were effectively banned across LA. Considering people were not out during the majority of the pandemic, this meant that business was sparse, and what little business they had, they had to weigh it against putting themselves at risk of contracting COVID. This economic lifeline was severely stunted during the pandemic. And many were forced to go out to work despite the health risks because of personal debt that was piling up.
At the onset of the pandemic when we first opened the application, 96% of vendors saw a drop in sales, and 66% had someone else in their household experience a loss in job or reduction in working hours.
As part of the SVEF application, we asked about what they planned to use the money for to understand where their biggest needs were. Vendors were allowed to check as many boxes as applied. We found that of the 2,653 responses, vendors would use the money for the following
78% for rent
76% for food
67% for bills
6% for childcare
10% for medical expenses
9% for other expenses
26% for other necessities
We had opened the application two times - once at the beginning of the pandemic in 2020, and once at the beginning of 2021. Between the two open application periods, we changed a few questions to better understand the financial situation that vendors were facing. For the 2021 open application, we asked about whether vendors were behind on rent and utility payments, and if they had taken out any sort of loan to weather the economic crisis of the pandemic. We found that of the 1,873 respondents, they experienced enormous financial hardship.
60% behind on rent
57% behind on utility payments
46% had taken out loans
Loans that had been taken out were either from a family member or friend, or a more predatory source such as Speedy Cash, ACE Cash Express, and other payday and title lenders. These types of loans can have high interest rates, and are hard to pay back because of the interest accrued. Interest rates can run upwards of 200% APR. Places like these often get people into a cycle of predatory debt because of how hard they are to pay back - an explicit intention of the financial product. Being behind on rent puts vendors at risk of eviction, especially as tenant protections are lifted in the coming months. These compounding financial hardships put these entrepreneurs at dire risk of losing everything they have, and increasing their likelihood of not being able to secure stable housing and utilities in the future due to the impacts these hardships have on credit and other financial markers.
These figures give us a small glimpse into the struggle that vendors faced and continue to experience during the pandemic. The ripple effects of these businesses being shut down and stifled will be seen for years. As business owners who serve neighborhoods that have long been neglected and often don’t have access to healthy foods and affordable goods, when they suffer, the entire community they serve suffers.
Street Food and Infrastructure
For food vendors, the process into compliance is significantly more complicated than for those who sell merchandise like clothing or electronics. Both types of vendors have infrastructural needs - space on the sidewalk to conduct their work, and for food vendors, the approved carts to hold their wares, as well as the commissary space for both storage and cooking of their goods. The level of infrastructure needed depends on what a vendor sells - not just food or merchandise, but what kind of food and how they sell it.
52.2% Food Vendors
44.3% Merchandise Vendors
2.5% Both
1.1% Unsure
The breakdown above is reflective of those who applied to the SVEF. It also indicates that food vendors may have been struggling more than their colleagues who sell non-food items. This comes at no surprise - the food regulations are notoriously difficult and complex to wade through, and if vendors did not have their proper permits, they were banned from selling in the City of LA.
Even if the laws around food vending weren’t so complex, Los Angeles doesn’t have the physical infrastructure necessary for them to be considered compliant in the eyes of California law. The California Retail Food Code - a set of codes that regulates any retail food business in California - dictates most aspects of food vending, including what needs to be on the cart, and that it needs to be stored and serviced at an approved commissary.
In order to understand exactly how much of that infrastructure is needed, we analyzed what vendors of the SVEF sell. Of the over 2,600 applications we received, 1,384 of them were for food vendors. We reviewed each item and classified them based on how the LA County Department of Public Health would classify their associated cart.
Low Risk Prepackaged Foods - like non-perishable items such as chips, canned sodas, and paletas
Low Risk Limited Unpackaged Foods - like churros, pretzels, and shaved ice
High Risk Unpackaged/Potentially Hazardous Foods - like tacos, tamales, fresh cut fruit, and bacon-wrapped hot dogs
Of the responses of all food vendors, about 13% (179 responses) gave too generic of an answer to classify (sometimes people understandably did not want to answer, and other times it was just “food”). What we found with the rest, however, was enlightening.
Because we have over 1,200 vendors through a random sample, the percentages below can be applied to understand full food vending populations in Los Angeles. Some vendors sell multiple food items, so are classified in multiple categories.
15.7% Low Risk Prepackaged Foods
10.9% Low Risk Unpackaged Foods
73.0% High Risk Unpackaged/Potentially Hazardous Foods
The High Risk category is the most complex and encompasses many types of processes that vendors use to make and serve their foods. Foods that are cooked-to-order, hot held to remain safe for customers to eat, and refrigerated to ensure safety before serving all fall in this category. 1,011 of vendors who applied for the SVEF fall in this category - meaning we know that at least that many vendors across Los Angeles need a shared kitchen space to prepare their food before putting it on their cart.
We broke down the “High Risk” category even further to understand the complexity of the cart that some vendors will need. Vendors often sell multiple food items, so their operation may fall into more than one of the three categories.
28.3% Cooked-to-order
49.3% Hot Held Foods
14.1% Refrigeration Required
Compliant carts that serve cooked-to-order foods do not currently exist on the market that can also fit on the sidewalk. Hitch trailers and full food trucks do exist, but often cost $30,000 or more. In the last few weeks, the first-ever compliant tamal cart that both fits on the sidewalk and is light enough to be pushed down the sidewalk was approved by the Department of Public Health. These carts are not yet fully manufactured and on the market, so vendors selling tamales and other hot held foods likely do not have a compliant mobile food cart (unless they have a hitch trailer!).
In addition to the lack of equipment, the necessary commissary spaces are also lacking. Commissaries are places where mobile food businesses like food trucks and street vendors store and clean their carts. Sidewalk vendors also have to prepare food they are going to sell in an approved commercial kitchen - typically housed in the same space that storage of carts occurs. Currently, only eight commissaries that service food carts are available across the County, and most of those are meant specifically for the small ice cream push carts.
Even if all vendors had their fully legal carts - there would not be enough commissary space to house them or commercial kitchen space for them to prepare. Considering there are an estimated 10,000 food vendors cross the county who will need access to a commissary space, we need to be thinking creatively about how to quickly and efficiently address the gap in infrastructure - including through partnerships between street vendors and brick and mortar businesses, as well as utilizing spaces such as community centers, schools, and churches.
The Road to Recovery
Over the course of the pandemic, we saw how vendors were significantly harmed by the economic detriment COVID caused. Their outright ban, then significant drop in sales, and lacking basic infrastructure needed for their businesses are all factors that will shape the economic recovery of Los Angeles.
Vendors must be centered in in our economic recovery. COVID has shown us that being outdoors must become an integral part of our lives to not only protect one another, but also boost our mental health. Street vendors are the original outdoor dining experience, and as more business turn to the outdoors to recover economically, it only makes sense to center the needs of those who have been most marginalized during and prior to the pandemic. They are at the center of our economy, and will become the cornerstone of the open air economies that will emerge in our recovery.
We must make the process for vendors and vending easier, more accessible, and less expensive. There are local and state law changes that can do just that. When we support the smallest of businesses, we will be supporting our whole ecosystem of business owners.
We have made important strides in street vending over the last few years, but as we move towards a pivotal moment where the outside is prized more - we have an opportunity to shift the narrative and make sure that all outdoor-based businesses are supported, starting with street vendors.