Republican gubernatorial candidate Bruce Blakeman is reaching back a century and a half into New York's constitutional history to mount a legal challenge against Mayor Zohran Mamdani's plan to spend $70 million in taxpayer money on city-owned grocery stores, one in each of the five boroughs, operated by hand-picked private companies and subsidized by the very businesses they would undercut.
Blakeman, who also serves as Nassau County Executive, told the New York Post he plans to invoke the state constitution's "Gift and Loan Clause," a provision originally enacted roughly 150 years ago to stop local governments from funneling public dollars to private railroad companies and other politically connected entities. The clause prohibits municipalities from giving or lending public money or property to private parties and requires that municipal funds serve a genuine public purpose.
No formal lawsuit has been filed. But Blakeman made clear the fight is coming, and that any challenge would likely land in court.
Blakeman did not hold back about what the mayor's grocery scheme would mean for the small-business owners who already line New York's blocks.
"This unconstitutional subsidy poses a direct threat to long-standing, tax-paying businesses, risking widespread closures and job losses within the community."
He went further, zeroing in on the impossible math facing independent grocers and bodega owners who operate on thin margins while paying state and local taxes that would, under this plan, flow directly to their government-backed competitors.
"Local independent supermarkets and bodegas, which operate on razor-thin margins, cannot compete with a government-backed entity that faces zero overhead costs."
The phrase that drew the most attention was Blakeman's broadside against the entire concept. He called Mamdani's proposal "an incredibly expensive socialist pipe dream that forces local mom-and-pop shops, who already pay astronomical state taxes, to compete against a government monopoly subsidized by those very same tax dollars."
Then the sharpest line: "We are literally forcing neighborhood grocers to fund their own demise."
The Gift and Loan Clause was written into New York's constitution in an era when state and local governments were hemorrhaging public funds into private railroad ventures and sweetheart deals for well-connected insiders. Its core prohibition is straightforward: municipalities cannot hand public money or property to private entities unless the expenditure serves a legitimate public purpose.
Blakeman's argument is that Mamdani's plan does the opposite, channeling $70 million in city funds to select private companies that would run the stores, giving those companies advantages no private-market competitor could match, and driving existing taxpaying businesses toward closure in the process.
Not everyone is convinced the argument will hold up. James M. McGuire, a former state appellate judge and former chief counsel to Republican ex-Governor George Pataki, said Blakeman "may have a difficult time" making the case stick, citing "precedents" set by the state Court of Appeals. McGuire did not elaborate on which specific precedents he had in mind.
That legal uncertainty has not slowed the political opposition. Blakeman framed the fight in terms designed to resonate well beyond courtroom briefs: "New York runs on fiscal responsibility, free enterprise, and the grit of local entrepreneurs, not bottomless government spending on Soviet-style supermarkets."
Blakeman is far from alone in opposing the plan. A newly formed immigrant-led business coalition called the Multicultural Business Coalition has raised over $1 million to fight Mamdani's grocery store initiative, as the New York Post reported in May. The coalition represents more than 50 chambers of commerce and has signaled it is prepared to sue.
"We will be at the hearing in force. We don't want to hurt the mayor but we are not going to let him hurt us," said Frank Garcia, the MBC's chairman. A City Council Economic Development Committee hearing was tentatively slated for May 29 to vet the plan.
Nelson Eusebio of the National Supermarket Association laid out the stakes plainly: "The worst case scenario is if they get funding to build 100 stores around the city. You can't compete with a store that's not paying rent and getting breaks from the city."
A separate group, NYC Common Sense, led by former mayoral candidate Jim Walden, has also raised $1 million to oppose Mamdani's broader agenda. The opposition, in other words, is organized, funded, and growing.
Governor Kathy Hochul, who endorsed Mamdani for mayor, has kept a conspicuous distance from the grocery store plan. At an August 2025 breakfast for business leaders in the Hamptons, Hochul offered four words that amounted to an indirect rebuke: "I favor free enterprise."
She has not made any public comments on the plan since. The silence is notable. Hochul leads Blakeman by 6 points in the latest gubernatorial polling, and the grocery store fight gives her Republican challenger a populist issue that cuts across party lines, small-business survival against government overreach.
Mamdani's administration has faced a pattern of controversies that have tested his political standing. His office drew criticism over an immigrant enclave map that excluded several well-known ethnic neighborhoods, and the mayor has struggled to reconcile his progressive ideology with governing realities on multiple fronts.
The Mayor's Office did not return messages seeking comment on Blakeman's constitutional challenge.
The grocery store fight is only one front in a broader credibility crisis for the Mamdani administration. The mayor's socialist policy ambitions have collided with the fiscal reality that New York City's budget depends on the very wealthy individuals and corporations he has spent years attacking.
Fox News reported that Mamdani has been quietly courting Wall Street heavyweights, meeting with JPMorgan Chase CEO Jamie Dimon and Goldman Sachs CEO David Solomon amid backlash over his proposed tax policies. He even reached out to Citadel founder Ken Griffin, the same billionaire outside whose Manhattan penthouse Mamdani once stood to promote higher taxes on second homes worth over $5 million.
Adam Lehodey of the Manhattan Institute observed that "the Mamdani administration has come to recognize that so much of their agenda depends on having successful businesses and wealth creators in the city. Simply alienating them isn't going to solve any of New York's problems." Nicole Huyer of the Heritage Foundation put a finer point on it: "Pitching class warfare and then pivoting to court Wall Street executives risks appearing politically performative."
Jeff Bezos publicly criticized Mamdani's approach, defending Ken Griffin on CNBC and pushing back against what he called the vilification of wealthy New Yorkers. That a mayor who built his brand on taxing the rich now needs their cooperation to fund basic city services tells you everything about the sustainability of his governing philosophy.
The contradictions extend beyond fiscal policy. The State Department shut down a planned meeting between a Mamdani administration official and Iran's UN ambassador, an episode that raised serious questions about the judgment and priorities inside City Hall.
John Catsimatidis, the billionaire CEO of Gristedes supermarkets and owner of WABC-AM radio, said he was unfamiliar with the Gift and Loan Clause but hoped "common sense prevails" and that Mamdani's plan is stopped, regardless of who wins the governor's race.
Catsimatidis offered an alternative approach: instead of building government-run stores, Mamdani could subsidize existing grocers who buy staples like milk, eggs, and bread in bulk, on the condition they pass the savings on to customers. It is the kind of market-friendly solution that achieves the stated goal, cheaper groceries, without creating a government monopoly or threatening existing jobs.
The political fallout from Mamdani's agenda has rippled through his own ideological allies. Democratic Socialists moved to blacklist one of his advisers after a disastrous state Senate campaign, a sign that even the mayor's left flank is fracturing under the weight of real-world results.
Meanwhile, the city's existing grocers, many of them immigrant-owned, operating on margins that leave no room for a subsidized competitor, are watching and organizing. They did not ask for a government rival. They asked to be left alone to run their businesses.
Blakeman has not yet filed a formal legal challenge, so the constitutional argument remains untested. McGuire's caution about Court of Appeals precedents suggests the Gift and Loan Clause may not be the clean legal weapon Blakeman presents it as. Courts have historically given municipalities some latitude in defining "public purpose," and Mamdani's team will almost certainly argue that food access in underserved neighborhoods qualifies.
But the political argument may matter more than the legal one. When immigrant-led business coalitions, supermarket executives, free-market advocates, and a Republican gubernatorial candidate all land on the same side of an issue, and the sitting governor quietly distances herself from her own endorsed mayor, the plan has a problem that no court ruling can fix.
The Mamdani administration's track record on basic city services has not exactly inspired confidence that City Hall is ready to run a grocery chain. Managing five supermarkets across five boroughs requires supply chains, staffing, refrigeration, spoilage control, and customer service, competencies that government entities are not famous for.
Blakeman trails in the polls. But if he can make this fight about whether New York's government should compete against the taxpayers who fund it, the grocery store plan may end up costing Mamdani more than $70 million.
When the government becomes your competitor and your tax collector at the same time, free enterprise is not just threatened, it is a contradiction the constitution was written to prevent.