Ocean City food truck franchise up for bid again

(Feb. 22, 2013) Despite the growing popularity in many of America’s larger metropolitan areas of gourmet food-vending trucks, the notion seems to have never caught on outside the more urban districts. In Ocean City, the familiar jingle of the ice cream man has been the only calling of mobile treats for some decades.

But that could change, if one is willing to put up the cash.

Those interested in becoming a roving purveyor of edibles should note that the Town of Ocean City will soon be accepting bids to franchise the rights to mobile food vending, in a slightly altered area of the town, following what appears to be a defaulting on a contract by the previous licensee.

“The code allows ‘vending prepared food from a motor vehicle, to operate in certain public ways of Ocean City,’” said City Clerk Kelly Allmond, who administers the town’s franchise venues. “We get people calling all the time with ideas about selling Greek food, Italian food … it doesn’t have to be ice cream.”

Just as it does with beach equipment stands and taxi medallions, the town periodically auctions off a number of authorizations – in the case of mobile food vendors, just one – to conduct specified, restricted commercial ventures on public property. These are done under a contract period, which, in the case of the food truck franchisee, is four years.

The franchise gives the vending company the right to operate anywhere within the town north of 18th Street, a restriction put in place some decades ago to protect the Boardwalk commercial strip from unfair competition.

However, this week, council voted to move forward with an ordinance altering the prohibited area to be anywhere south of 27th Street, given the expansion of the Boardwalk in the 1980s. But it was also decided that vending should be opened up to areas west of Baltimore Avenue, even in the city’s southern end.

“We have businesses all over town now,” said Councilman Dennis Dare. “The town’s changed since the ordinance was written and I can still see [restricting] that block by the ocean, but as it is, this would prohibit the ice cream truck from going around Mallard Island or the Robin Drive area.”

“Those are residential-type areas where you typically see ice cream trucks going,” concurred Mayor Rick Meehan.

According to Allmond, the previous vending truck contractor – JSJ Venture – first won the franchise in January of 2007 for a bid price of $406,000. After two seasons of vending, however, the company requested that its annual payment be reduced from $101,500 to $80,000, citing poor profitability. The city agreed, and JSJ continued for another two seasons before re-bidding in 2011, and winning at a much-reduced price of $261,200 for four years.

After two seasons on that contract, however, it appears that the vendor no longer wishes to operate the franchise.

“The party that previously held our vehicle vending franchise has forfeited, and we are in the process of going out to rebid the franchise,” said Meehan. “This change [in prohibited area] will be part of the packet that goes out so that the areas where the vendor is allowed to work will be clear to the bidders.”

Meehan also suggested that the council authorize a debarment hearing to prevent the forfeiting vendor from bidding on the franchise when it is re-advertised.

Councilman Brent Ashley questioned if – given the city’s concern about protecting other merchants, and the apparent low profitability of the venture – the food truck franchise should not just be eliminated entirely.

Since the summer is fast approaching, “that might happen” by default, Councilman Joe Mitrecic said.

City Solicitor Guy Ayres said the town can go ahead and advertise the franchise, in anticipation of passing an ordinance with the changed prohibited operating area at the next regular session.