Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Supervisor David Pine, District 1
Supervisor Carole Groom, District 2
Subject: Emergency Regulation to Cap Fees Charged by Food Delivery Services
RECOMMENDATION:
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Adopt an emergency regulation of the County of San Mateo to establish a temporary cap on commissions and fees charged by third-party food delivery services on local restaurants during the time period in which the proclamation of local emergency related to COVID-19 remains in effect.
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BACKGROUND:
Over the past several months, numerous California jurisdictions have adopted local regulations that cap the fees that third-party food delivery service companies (e.g., Uber Eats, Grubhub, and DoorDash) are permitted to charge restaurants during the pendency of the COVID-19 state of emergency. Limitations on indoor dining have forced many restaurants to rely to an increased extent on takeout and delivery for much of their business, and fees charged by third party delivery services have cut significantly into many restaurants' revenue during a time when many restaurants struggle to remain viable. Keeping restaurants in business is important for the local economy, and robust restaurant delivery options ensure that people who are homebound during this pandemic can get fresh meals brought to their doors.
Absent a cap on delivery fees, third-party delivery service companies regularly charge restaurants up to 30 percent per order to use their online services. For example, Uber Eats imposes thirty percent of the cost of an order fee for delivery using Uber drivers, and charges fifteen percent of the cost of an order if a customer orders through the Uber Eats platform and picks up the order directly from the restaurant. Fees charged by Grubhub appear to be of a similar amount. A 2018 pricing overview indicates that restaurants are charged a twenty percent marketing commission, a ten ...
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