A top official in Mayor Zohran Mamdani's city-owned grocery store initiative suggested on live television that New York might offer taxpayer-funded grants to the very private grocers the program threatens to undercut, and City Hall scrambled to walk it back.
Waverly Neer, senior vice president of groceries at New York's Economic Development Corporation, told NY1 on Wednesday that grants for independent grocery businesses were "something on the table" as the city moves ahead with plans to open five government-run stores across the boroughs by the end of 2029. The clip racked up 1.6 million views on X by Thursday afternoon, drawing a wave of public ridicule that forced the EDC into damage control.
The sequence is worth spelling out: the Mamdani administration is spending at least $70 million in public money to build grocery stores that will sell a "core basket" of essential goods at a 30% discount. Those below-market prices will inevitably squeeze the private grocers already serving those neighborhoods. And the city's own grocery czar went on camera to float spending more public money, grants, to cushion the blow the first round of public money is about to deliver.
During the NY1 interview, Neer framed the potential subsidies as part of a broad toolkit. She said:
"I think there's a whole host of levers that the EDC is able to work within to make sure everyone has equitable and equal access to opportunities here."
Asked directly about grants, she did not rule them out. "Something on the table," she said. "We're exploring a lot of different options and opportunities."
By Thursday, with the clip circulating widely and criticism mounting, the EDC reversed her. An unnamed spokesperson issued a written statement: "We are not currently considering any grant programs for existing grocers."
But the walkback came with a caveat that left the door open to other forms of taxpayer support. The same spokesperson added that the EDC is "looking at the potential for tax abatement, incentives, and zoning benefits through existing City programs to ensure that the City is doing everything in our power to alleviate cost pressures for small businesses across the city."
In other words, the administration denied the specific word "grants" while acknowledging it is exploring tax breaks and regulatory favors for businesses that may be harmed by its own initiative. The underlying problem, a government program that creates competitive damage the government then has to mitigate, went unaddressed.
The grocery program has been a signature piece of Mamdani's agenda since his 2025 mayoral campaign, when he pitched city-owned stores as an answer to high food prices. Once in office, he revealed the 30% discount on essential goods, though city officials have not yet explained how they would calculate that discount or fund the gap between wholesale cost and the marked-down shelf price.
The price tag is already steep. One store planned for a vacant lot in East Harlem carries a $30 million construction budget alone. Across all five planned locations, the program is projected to cost at least $70 million, and that figure covers only construction, not ongoing operations, staffing, or the subsidized pricing.
Even before the grant controversy, the program faced criticism over basic shortcomings. EDC officials admitted the stores will lack features common to a typical supermarket, including hot food counters and butchers. Only two of the five promised locations have been finalized, with the first store not expected to open until 2027 and the Manhattan location pushed to 2029.
City officials have still not answered what the EDC's own interim CEO, Jeanny Pak, described in careful terms: "It may not have all the items, but it's going to be like a typical grocery store." That reassurance did little to quiet skeptics who noted that a store without a butcher counter or hot food is, by most shoppers' standards, not a typical grocery store at all.
Mamdani's leadership has drawn increasingly vocal public rejection on multiple fronts, and the grocery program has become a focal point for frustration with an administration that appears to generate new costs faster than it can justify old ones.
The backlash on social media was swift and pointed. One X user whose post was widely shared captured the objection in a few sentences:
"Succinctly: the government spends tax dollars to create an insanely bad problem. Then, to solve the problem that THEY CREATED, the government spends more tax dollars. Utterly insane."
Daniel Di Martino, a fellow at the Manhattan Institute, a free-market think tank, put it more sharply on the platform:
"Socialists always come up with more ways to steal your money to solve problems they created by giving away money they already stole from you."
Another user questioned the entire fiscal premise: "How is this making any fiscal sense? Mamdani is going to drop $30,000,000 just on one store which will operate at a huge loss, then give additional handouts to local grocers who might be impacted? Why not just give out vouchers for eggs & milk and be done with it?"
The voucher suggestion, whatever its merits, at least acknowledged a point the administration has not addressed: if the goal is cheaper groceries for low-income New Yorkers, there are far less expensive ways to accomplish it than building and operating government-owned retail stores that then require additional government spending to offset the damage they cause to existing businesses.
The grocery plan is hardly the only Mamdani initiative to draw this kind of scrutiny. His push for free transit has already produced real fiscal consequences as fare evasion surges, and a signature tax proposal was blocked by a judge after a botched rollout. A pattern is forming: ambitious progressive programs announced with fanfare, followed by operational failures and taxpayer costs the administration did not anticipate, or chose not to mention.
The EDC's Thursday statement deserves a closer look, because it did not actually close the door on public subsidies for private grocers. It denied "grant programs" specifically. It then confirmed the agency is actively exploring tax abatements, incentives, and zoning benefits, each of which carries a cost to the public, whether through forgone tax revenue or regulatory favors unavailable to businesses outside the program's orbit.
The distinction between a direct grant and a tax abatement may matter to a budget analyst. To the taxpayer, the result is the same: public resources directed toward mitigating a problem that public spending created. The city builds stores designed to undercut private competitors on price, then offers those competitors financial help to survive the competition. The money flows in a circle, and at every turn, the taxpayer is the one writing the check.
Even the comedian Bill Maher has publicly questioned the grocery store plan as a taxpayer-funded fantasy, a sign that the program's contradictions are visible well beyond conservative policy circles.
Meanwhile, the EDC's grocery task force continues evaluating "programs and policies" to support local grocers, though no timeline for that evaluation has been disclosed. City officials have not conducted, or at least have not released, any formal impact study on what five government-subsidized stores selling goods at a 30% discount will do to the independent grocers already operating on thin margins in those same neighborhoods.
The administration has also left unanswered what it describes as a "publicly-funded, privately-operated" model, who the private operators will be, how they will be selected, and what accountability mechanisms will govern a store that runs on taxpayer money but is managed by a private entity.
Mayor Mamdani has faced mounting questions about his leadership across multiple policy areas, and the grocery debacle adds another entry to a growing list of programs where the administration's ambitions outpace its answers.
City Hall treated Neer's NY1 appearance as a communications failure, a staffer who said too much, too publicly, before the messaging was ready. The walkback focused on language: no "grants," just "tax abatements" and "incentives." The spokesperson's statement read like a press shop putting out a fire, not an administration rethinking a flawed program.
But the problem Neer exposed on camera is structural, not rhetorical. A city-owned grocery store selling goods below market price will, by design, take customers from nearby private stores. Those private stores employ local workers, pay local taxes, and operate without public subsidy. If the city then has to subsidize them to survive its own competition, the program is not reducing costs, it is redistributing them, with a bureaucratic markup at every step.
No amount of careful word choice from the EDC press office changes that arithmetic. The grocery task force can study the question for months. The answer will be the same: when the government enters a market to undercut private businesses, someone pays for the damage. In New York, that someone is always the taxpayer.
Governments that have to subsidize the problems their own programs create are not solving anything. They are just billing the public twice.
