NEW YORK—Small businesses outside of Manhattan are being inspected more and fined more, according to a report released by Public Advocate Bill de Blasio on Thursday.
Restaurants and retails stores are inspected by the Department of Health and the Department of Consumer Affairs, respectively. Over the past two years, inspections have more than doubled, increasing most in Brooklyn, Queens, and the Bronx, according to the report.
Inspections by the Department of Consumer Affairs rose from 10,964 inspections in Fiscal Year 2010 to 24,176 inspections in Fiscal Year 2012, while revenue from fines stemming from inspections doubled, from $7 million to $14 million over the same period.
Manhattan has more retail businesses than any other borough, but they are inspected 18 percent less than average, while all other boroughs are inspected more than average. The highest inspection rate is in the Bronx, where retail stores are inspected seven percent more than average.
“This is a radical range here—22 percent range between [businesses in] Manhattan and the Bronx—and it shows a clear pattern of targeting the outer boroughs and going to them to take revenue out of small businesses that could not afford it,” said de Blasio on the steps of City Hall on Thursday. He called the increase in fines “a hidden tax.”
The problem is not the inspections but the discrepancy in how they are conducted, said de Blasio. Besides being carried out more often in the outer boroughs, the inspections are known to vary considerably depending on the inspector.
David Moo, owner of Quarter Bar in Greenwood, Brooklyn, said he was recently cited for having half inch holes in the ceiling of his basement, which were “potential entry points for pests.” He also said a friend who runs another bar was cited for having a fork covered in wax at his bar, even though the bar does not serve food and the inspector was told the fork was solely used for cleaning candles.
“The Health Department used to be more forgiving,” said Moo.
“I don’t think that the Health Department’s problems stem from either malice or corruption,” he added. “I think that the problem lies in a massive amount of inconsistency in the way that the health code is applied.”
The fines may seem small compared with the billions of dollars in the city budget, but they can cripple small businesses, said Assemblyman William Scarborough, Queens, and chair of the Small Business committee in the assembly.
The average fine from 2010 to 2012 was $697 per violation for the Department of Consumer Affairs.
“The gap in municipal government is filled with these onerous fees and fines and so on, and when it hits the small businesses—whose margin for error is often very small—it can be the difference between staying in business or going out of business,” Scarborough said. “And that can be the difference between a vibrant community and one that is going down.”
When inspections by the Department of Health were examined by City Council last spring, it was discovered how difficult it is for restaurants and food stores to appeal the letter grade they are given by the department, which is the result of inspections.
Neither the Department of Health or the Department of Consumer Affairs responded to press inquiries.
While most of the discrepancy is between Manhattan and the outer boroughs, there’s also a divide between Manhattan’s Central Business District and northern Manhattan, according to the report.
“Even within in Manhattan, you see a tale of two cities,” said de Blasio.
Councilman Ydanis Rodriguez, representing part of northern Manhattan, said in an interview he feels the departments don’t help the businesses out enough.
“The goal of any agency in the city should be that we correct anything that can be better, and the way the inspections are set up is in a way that makes the small businesses a target, not a partner,” he said.
Further, inspectors in certain areas should speak the language of the immigrants prevalent there, which would be Spanish in northern Manhattan, said Rodriguez.
Mayor Michael Bloomberg said at an unrelated press conference on Thursday that “Fines are very different than taxes.”
“You can’t avoid taxes,” he said. “Fines are easy to avoid, just don’t do what we are trying to prevent you from doing.”
Also, mayoral spokesperson Julie Wood in an email said there has been “robust economic growth” driven by small businesses in the borough outside Manhattan. She provided the following visuals.
Additional reporting by Kristen Meriwether