When Safeway closed its store on Main Street in Vallejo, it didn’t just leave – it made sure no other grocer could move in. The company placed a restrictive covenant on the property prohibiting any grocer from operating there for 15 years, leaving the surrounding community without a nearby supermarket. A Grocery Outlet opened as soon as the restriction expired. Unfortunately, Vallejo is not the only town affected by these anticompetitive tactics, nor the only place where restrictive covenants function as structural barriers to community food access.

“What we see is something that is currently legal but clearly unethical, where corporations are allowed to devastate the health of a community for profit,” Lauren Ornelas, Founder and President of Food Empowerment Project. 

To address this issue, California lawmakers recently introduced The Unlawfully Restrictive Covenants: Grocery Stores and Supermarkets Act (AB 1857), which would prohibit the use of restrictive covenants in grocery retail. Restrictive covenants are terms embedded into deeds and property agreements that limit how a property can be developed or used. Grocery retailers departing a property can use restrictive covenants to legally prevent any other grocer from operating in a space they’ve left behind. If passed, the bill would remove one of the most quietly harmful tools in corporate retail’s playbook, and position California as a national leader on food access and addressing corporate power in the food system.

The introduction of the bill follows the Berkeley Food Institute’s efforts to bring UC Irvine School of Law professor Christopher Leslie’s research to the attention of policymakers. Leslie has documented how these restrictive covenants function as an anti-competitive strategy that also compounds the broader harms of consolidation in the grocery industry. 

Grocery Store Consolidation Rises with Lack of Antitrust Enforcement

To understand why this legislation matters, it’s important to know what’s happened to the grocery industry over the past four decades.

In 1982, independent grocers represented more than half of all U.S. grocery sales.Today, that figure has fallen to roughly 22%. Between 2000 and 2023, the four largest grocery parent companies went from controlling about 42% of the market to nearly 67%, meaning roughly 70 cents of every grocery dollar now flows to just four conglomerates.

This didn’t happen by accident. The Reagan administration’s retreat from antitrust enforcement in the early 1980s, including the effective abandonment of enforcing the Robinson-Patman Act, allowed large grocery chains to secure steep supplier discounts unavailable to smaller competitors. Independent grocery retailers couldn’t keep pace and began closing. Waves of consolidation mergers followed through the 1990s and 2000s.

California is an example of the irony of grocery retail consolidation and food insecurity. The state grows over 50% of U.S. vegetables and roughly two-thirds of fruits and nuts, yet 1 in 5 Californians experiences hunger, and 2.7 million low-income residents live in areas with limited geographic access to grocery stores.

The Compounding Effect of Restrictive Covenants

The harms of grocery consolidation are widespread, leaving fewer choices and options for consumers and workers, and increased prices at the checkout counter. Additionally, restrictive covenants don’t fall evenly across communities. They land hardest on Black, Latino, and Indigenous populations, the same communities that were excluded from buying or occupying property by racially restrictive housing covenants decades ago. The Fair Housing Act of 1968 made racially restrictive covenants illegal, but the disparities in neighborhood investment persist. Today, 50% of Black neighborhoods nationally lack a supermarket or full-service grocery store. In Northern California, 92% of Native American households experience food insecurity.

Without competition, prices rise. In locations where large retail chains block others from moving in, a vacuum is created where independent urban grocers charge 10–60% more than chain supermarkets, meaning residents in lower-income, less-served neighborhoods pay a premium for the same food. Food prices have risen nearly 30% since 2020, and those increases hit food-insecure and low-income communities the hardest. This effect has contributed to California’s $7 billion annual healthcare burden, the highest in the nation.

California’s Policy Response

The proposed legislation, which would ban restrictive covenants on grocery retail, is part of a broader wave of policymaking aimed at improving food access in California. In 2023, the legislature passed SB 628, declaring food as a human right, and affirming the state’s responsibility to remove barriers that prevent Californians from accessing affordable and healthy food. In 2024, the state’s Attorney General Rob Bonta joined a federal effort to block the proposed merger of Kroger and Albertsons, the largest proposed grocery merger in U.S. history. Additionally, the California Law Review Commission has been studying sweeping antitrust reform since 2022, officially concluding in January 2026 that lawmakers should adopt a ban on predatory and anti-competitive conduct by powerful companies. The Institute for Local Self-Reliance (ILSR) has described the resulting proposals as potentially the nation’s strongest antimonopoly legislation.

From Research to Legislative Action 

Fair and competitive markets in food and agriculture are an increasingly pressing concern. To address it, the Berkeley Food Institute’s policy program, led by Neha Sanghera, highlighted relevant University of California research through BFI’s Lunch & Learn webinar series, which connects recent findings to current policy discussions at the state and federal levels.  

The resulting Fall 2025 webinar hosted Doha Mekki, Senior Fellow at Berkeley Law School and former Acting Assistant Attorney General for the Department of Justice’s Antitrust Division, and Christopher Leslie, UC Irvine Chancellor’s Professor of Law. Mekki opened by grounding the audience in antitrust laws, competition principles, and their application to food and agriculture markets. Leslie then examined how grocery retail consolidation and restrictive property covenants limit access to fresh produce and affordable groceries across communities. His research finds that restrictive covenants on grocery retail are a deliberate tool used by market incumbents to protect their market share at the expense of communities.

Following the webinar, members of the California Food and Farming Network, a coalition of statewide food justice and sustainable agriculture groups, began discussing potential legislative options to address restrictive covenants. 

This February, Assemblymember Cecilia Aguiar-Curry (D-Winters) introduced The Unlawfully Restrictive Covenants: Grocery Stores and Supermarkets Act (AB 1857), co-sponsored by the California Food and Farming Network and the Economic Security Project, California. The bill draws parallels to racially restrictive housing covenants, described above, noting that grocery store restrictive covenants function as a structural barrier to food access following a pattern of disinvestment. AB 1857 would extend that same logic as fair housing protections to food retail. 

What Comes Next

Restrictive covenants are a symptom of a larger problem: four decades of weakened antitrust enforcement have concentrated corporate power and reshaped who can access food, at what price, and in which communities. The consequences are not abstract. They are felt in neighborhoods without a grocery store, through the rising cost of food, and the prevalence of food insecurity. Addressing these covenants is not just a real estate or land use fix. It is part of a broader and growing movement to reassert public interest in how markets are structured. California’s current legislative window, with proposed antitrust reform, an engaged Attorney General, and a bill directly targeting these covenants, represents a real opportunity to change the narrative.

By Madison Spinelli, BFI Policy Assistant