The city's Department of Health and Mental Hygiene said the system has achieved its intended effect of motivating restaurants to improve their food handling practices. Despite that praise, many in the food industry, including those whose restaurants earned an "A", argue the system is subjective and unfair.

"I'm not sure it was needed, the format," said Lorenzo Ansuini, who owns Mezzogiorno in the Soho neighborhood.

While Ansuini's restaurant has a prominent "A" in its store window, he said other restaurants have lost business after receiving a poor grade. "I wonder if it does more damage than it's intended to do," he said, adding, "You have a very wide range of variance between different inspectors."

Health inspectors visit restaurants and deduct points for infractions including vermin, uncovered garbage cans and food left out of the refrigerator for extended periods.

Under the system that began in July 2010, restaurants with fewer than 14 violation points earn an A, those with 14 to 27 points receive a B and 28 or more points means a C.

Restaurants that are cited for 13 or more violation points are reinspected within a month. If they still don't receive an A, it must post its B or C grade or display a sign that says "Grade Pending" while it appeals the ruling at an administrative tribunal.

The Health Department has inspected 10,000 restaurants so far and intends to assess all of the city's 24,000 eateries by year's end.

According to the Health Department's Web site, the proportion of A grades has exceeded its expectations. While 27 percent of restaurants earned an A on their first inspection, many improved enough to receive an A after the second inspection.