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City Demands Closure of Eldridge Street Shop Selling Bargain Cigarettes

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Photo by Robert K. Chin.

The storefront at 116 Eldridge Street, next to Vanessa’s Dumplings, certainly doesn’t seen like the kind of business that would attract the attention of city attorneys and the New Yorker’s “Talk of the Town.”  But sure enough, a relatively new enterprise, “Island Smokes,” is making waves.

According to the magazine and the New York Post, the city has sent the owners a “cease-and-desist” letter, urging them to close the Lower East Side store and a flagship operation on Staten Island immediately.

In August, Island Smokes’ Eldridge Street location began selling cigarettes for $2.90 a pack, a fraction of the $14.50 many bodegas charge.  The company, which counts among its founders a New York City police captain, is able to do this by using pipe tobacco (which is taxed at a lower rate than manufactured cigarettes) and by requiring customers to roll their own cigarettes.

John Kimball, the police captain (and non-smoker), told the New Yorker, “I’ve watched New York smokers get turned into lepers… they are my friends and family. They aren’t felons.”

 

The company’s web site is advertising for “potential investors.”  They call it “the best business opportunity in any economy, especially the current one.”  Here’s part of the pitch:

NEW STORES OPENING IN FORDHAM ROAD, BRONX / DYKER HEIGHTS and BAY RIDGE  BROOKLYN / the EAST VILLAGE NYC / and JACKSON HEIGHTS, QUEENS, and MORE…. MANY EXCLUSIVE AREAS STILL AVAILABLE FOR INVESTORS!! ALL TERRITORIES SOLD ON A FIRST COME, FIRST SERVED BASIS… WE ARE LOOKING FOR TEAM PLAYERS WHO WISH TO PARTICIPATE IN THIS PUBLIC SERVICE, AND PROFITABLE BUSINESS – PROVIDING ALL NATURAL TOBACCO AT VERY LOW PRICES TO NEW YORK SMOKERS.

The owners may believe they’ve found a loophole in the law, but apparently the city disagrees. The Office of Tax Enforcement launched an undercover operation and notified New York City officials, who (the New Yorker reports) concluded “Island Smokes was in violation of at least three laws.”   Representatives of the company told the Post they did not know the city was demanding the closure of the fledgling operation:

The business’ lawyer, Jonathan Behrins, said he was aware of no such cease-and-desist order. Kimball’s business partner, Patrick Donnelly — a retired New Jersey cop — said the city order is “news to me.”… “I can’t understand why they’d want to shut us down if we want to provide a healthy alternative to the public,” Donnelly said, referring to the shop’s tobacco choices, self-described as “additive free” and “healthier” than the average smoke.

NYC Law Department attorney Eric Proshansky said, “tobacco and cigarettes are highly regulated industries. From our side, the law is very clear and we are going to make every effort to enforce it.”
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