Republican gubernatorial candidate Bruce Blakeman is looking to invoke a rarely cited provision of the New York State Constitution in an effort to block New York City Mayor Zohran Mamdani’s proposed $70 million taxpayer-funded plan for city-owned grocery stores.
The provision, known as the “Gift and Loan Clause,” bars municipalities from giving or lending public money or property to private entities.
“This unconstitutional subsidy poses a direct threat to long-standing, tax-paying businesses, risking widespread closures and job losses within the community,” Blakeman told The Post.
The roughly 150-year-old rule was originally adopted to prevent local governments from steering public resources to private railroad companies and other politically favored recipients. It also requires municipal spending to serve a public purpose or provide a public benefit.
Blakeman, the Nassau County executive, argues that Mamdani’s proposal to establish one city-owned supermarket in each of the five boroughs—operated by selected private companies—would violate the clause by using public funds to lower prices and undercut private competitors.
“Local independent supermarkets and bodegas, which operate on razor-thin margins, cannot compete with a government-backed entity that faces zero overhead costs,” said Blakeman, who trails Gov. Kathy Hochul by 6 points in the latest gubernatorial race polls.
Hochul, who endorsed Mamdani for mayor, has offered only indirect criticism of the grocery plan. Speaking to business leaders at an August 2025 breakfast in the Hamptons, she said, “I favor free enterprise.” She has not publicly addressed the proposal since then.
Any attempt to challenge Mamdani’s city-run supermarket proposal would likely be decided in court, where a central question would be whether the plan satisfies the Constitution’s public benefit requirement.
The mayor would likely contend that lowering grocery costs for New Yorkers qualifies, legal experts say. Blakeman argues the opposite — that publicly run stores would drive out competition, eliminate jobs and shrink consumer choices.
James M. McGuire, a former state appellate judge and chief counsel to Republican ex-Gov. George Pataki, said Blakeman “may have a difficult time” having his argument hold up to any legal challenges based on “precedents” set by the state Court of Appeals.
Gristedes supermarket CEO John Catsimatidis said he’s unfamiliar with the Gift and Loan Clause, but he hopes “common sense prevails” and that Mamdani’s supermarket plan is spiked — no matter who wins the gubernatorial race.
The billionaire WABC-AM radio owner also said that if Mamdani is serious about driving down grocery costs he should simply subsidize grocers who buy milk, eggs and bread in bulk on the condition they pass the savings on to customers.
The Mayor’s Office didn’t return messages.
Blakeman called Mamdani’s plan “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.”
“We are literally forcing neighborhood grocers to fund their own demise,” he continued. “New York runs on fiscal responsibility, free enterprise, and the grit of local entrepreneurs — not bottomless government spending on Soviet-style supermarkets.”
