Smart cities have recognized that food trucks play an important role in developing a lively, vibrant, and local business climate. But the city of San Antonio uses its 300-foot rule to punish food trucks for choosing a different business model than their brick-and-mortar competitors. San Antonio should be encouraging the entrepreneurs that operate food trucks, not disadvantaging them by playing favorites.

It is people, not the government, who get to pick winners and losers in the marketplace. That is why the Institute for Justice (“IJ”) and four San Antonio food truck owners are teaming up to challenge the constitutionality of San Antonio’s 300-foot rule under the Texas Constitution.

San Antonio’s 300-Foot Rule Against Food Trucks

The city of San Antonio is not friendly to food truck entrepreneurs. For over a decade, the city has protected restaurants and other food establishments from competition by food trucks.[2] Food trucks are banned from vending within 300 feet of their brick-and-mortar competitors—the same 100-yard-distance that spans a football field. There are literally thousands of these “no-vending zones” throughout the city.[3]

The San Antonio City Code provides that mobile vending operations “shall not be carried on within three hundred (300) feet of the property line of any permitted food establishment.”[4] Food trucks that violate the 300-foot rule face fines of up to $2,000 per day.[5] The law broadly defines “food establishment,” which includes restaurants, grocery stores, and retail food stores such as convenience stores.[6] The 300-foot rule applies even if a food truck is parked on private property,[7] and it is enforced citywide (except for a small area of downtown).[8]

Vending within a 300-foot “no-vending zone” is extremely difficult. To attempt to do so, food trucks must: (1) approach every restaurant and other brick-and-mortar competitor within 300 feet; (2) ask the owner for a written and notarized permission slip allowing them to operate their food truck within 300 feet of their property line; and (3) keep each of those permission slips in their food truck “at all times.”[9] If any brick-and-mortar competitor revokes their permission—something they are free to do at any time and without notice—the affected food truck must shut down all vending operations.

If that wasn’t enough, San Antonio does nothing in the 300-foot rule to prevent restaurants and other brick-and-mortar food businesses from making food truck owners pay the restaurant in exchange for the permission slips the city requires. In one case, a food establishment that opened across the street from a pre-existing food truck is requiring $400 monthly payments for their permission and calling it “rent”; if the food truck fails to pay the permission will be revoked and the food truck will be forced to shut down.

The 300-foot rule also hurts food trucks that do not currently vend anywhere near a restaurant. If a restaurant, or another brick-and-mortar business that sells food, opens a new location within 300 feet of pre-existing food trucks, San Antonio’s 300-foot rule forces those food trucks to shut down if they are not given permission to remain open.[10] It matters not if the food trucks were there first, nor does it matter if food truck owners have signed leases for their vending locations. For the same reason, the 300-foot rule constrains food trucks seeking to vend in multiple locations, and makes it very difficult to expand one’s business by adding a second food truck.

Last year, the 300-foot rule became even more burdensome. The San Antonio City Council passed an ordinance adding the words “of the property line” to the 300-foot rule.[11] This means the 300-foot “no‑vending zone” need not extend to a restaurant’s building to force a food truck to shut down; instead, if a food truck is 300 feet away from the edge of a restaurant’s lot it is prohibited from operating. This change effectively increased the reach of the 300-foot rule.

The Legal Argument

San Antonio’s 300-foot rule is not just bad policy—it is unconstitutional. The Texas Constitution does not allow government to use its power in order to pick winners and losers in the marketplace. But that is exactly what San Antonio is doing. By enforcing its 300-foot rule against food trucks, the city is violating the economic liberty of every food truck entrepreneur in San Antonio. And it is adding insult to injury by making food trucks beg their brick-and-mortar competitors for permission to operate.

Economic liberty is an individual right protected by Article I, Section 19 of the Texas Constitution. It allows everyone to earn an honest living in their chosen occupation, free from unreasonable government interference. No health or safety concerns are addressed by San Antonio’s 300-foot rule against food trucks. Laws addressing food and traffic safety are already on the books. The 300-foot rule is not one of them. All that the rule does is protect brick-and-mortar restaurants and other retail food establishments from their food-truck competition. But protecting one type of business by harming another—i.e., pure economic protectionism—is not a legitimate use of government power.

The Texas Supreme Court issued a landmark ruling this June in a constitutional case involving economic liberty. In Patel v. Texas Department of Licensing and Regulation, the Court made clear that economic liberty is a vigorously protected individual right under Article I, Section 19.[12] Under Patel, Texas courts apply a constitutional test that provides greater protections for economic liberty under the Texas Constitution than under the U.S. Constitution.[13] Texas courts must determine whether a legitimate government interest exists to support an economic regulation, whether the challenged law is rationally related to that governmental interest, and now must also look at the law’s effect as a whole and determine if it is so “unreasonably burdensome that it becomes oppressive.”[14] Importantly, the Texas Supreme Court also held that determining whether a law is unconstitutional under the Patel test will require judges to review all the evidence in the record.[15]

The evidence and very structure of the law make clear that San Antonio’s 300-foot rule is nothing but protectionism. Simply put, the government cannot impose burdens on food truck entrepreneurs for no good reason. It is for consumers to decide the winners and losers in the marketplace, not the government.

The Plaintiffs

The plaintiffs in this case illustrate the real costs the law has for food truck entrepreneurs across the city. In some cases, food truck businesses were shut down because restaurants did not want a food truck competing against them. In others, food truck businesses have trouble growing their businesses and signing leases for new vending locations because of the constant threat of being shut down by the city’s 300-foot rule.

Rafael Lopez owns and operates a Mexican restaurant named El Bandera Jalisco. Earlier this year, he set to open a second location where he planned to combine the indoor seating of a restaurant alongside a food truck parked on the same property. He signed a lease, invested $40,000 in a food truck, obtained the required permit, and began operating his new El Bandera Jalisco food truck at his new location. Two months later he was visited by a city inspector.

San Antonio shut down Rafael’s food truck and threatened him with daily fines of up to $2,000 per day if he continued to vend. The city inspector told him to ask his next door neighbor, the Hung Fong Chinese Restaurant, for a written and notarized permission slip allowing him to reopen. Unsurprisingly, he was unable to obtain their permission. By invoking the 300-foot rule, the city shut down Rafael’s food truck. The El Bandera Jalisco food truck now sits in storage. If Rafael had opened a restaurant on the same property he would be in business; because he opened a food truck instead, San Antonio has put him out of business.

Regino Soriano owns a popular food truck named El Bandolero. He offers customers Zacatecas cuisine with tortas, burritos, quesadillas, and tacos. His food has become very popular.[16] For the past eight years, he has leased space in the parking lot of an HEB grocery store and vends during the evening and night hours. Soon after opening for business, a city of San Antonio inspector told him to shut down or face daily fines. Regino was told to get written and notarized permission slips from the nearby McDonald’s restaurant and also the HEB grocery store, even though he already had a signed lease with them. Regino did just that.

Although he was able to reopen, he operates in the 300-foot rule’s long shadow. First, Regino worries that a new restaurant will open nearby. This would force him to shut down El Bandolero and possibly leave even though he has a lease with HEB. Second, McDonald’s could revoke their permission at any time which would also force him to shut down his vending business. Third, his plans to expand his business and vend in other locations around the city have been significantly restricted by the city’s 300-foot rule. Good locations that are beyond the rule’s reach are hard to find.

Bernardo Soriano, Regino’s 24-year old son, owns and operates El Bandolero II, a food truck on the north side of San Antonio. He vends on private property off of US Highway 281. While there is not much around his vending location, his customers know exactly where to find his food truck. He learned the ropes from his father when he was a teenager and decided to open his own vending business two years ago. Bernardo grew his customer base, slowly paid off his food truck, and now owns it outright.

Bernardo has plans to grow his food truck business but the 300-foot rule is making it very difficult for him to realize his goals. He has been asked to take on private vending engagements and bring his food truck to his customers. But restaurants, convenience stores, retail food stores, and grocery stores are ubiquitous throughout San Antonio; if customers want to hire him to vend at their function, he would need to reject everyone falling within a 300-foot “no-vending zone.”

Ricardo Quintanilla operates Tacos el Regio. He offers his customers Mexican cuisine inspired by recipes from Monterrey, Mexico. He operates his food truck on private property along Nacogdoches Road. Recently, however, Ricardo had to decide whether or not to sign a 2-year lease under a cloud of uncertainty created by the 300-foot rule.

Across the street from his food truck—within 300 feet away—sits a vacant commercial property. If a brick-and-mortar business that sells food moves in across the street, Ricardo will be forced to shut down Tacos el Regio. Even worse, if that happens and he is unable to get the newcomer’s permission to reopen his food truck business, Ricardo will have no choice but to relocate his popular food truck while remaining on the hook for the 2-year lease he signed. Ricardo is not alone. The same cloud of uncertainly hangs over Regino and Bernardo, and it has already put Rafael’s El Bandera Jalisco food truck out of business.