HomeCity Government NewsCouncil Ponders Direction on Food Delivery Fee Cap

Council Ponders Direction on Food Delivery Fee Cap

First published in the Aug. 13 print issue of the Glendale News-Press.

The Glendale City Council has requested additional information and legal opinions before making a decision on whether to continue a cap on third-party food delivery charges it instituted in the early days of the COVID-19 pandemic.
Various council members have asked for input from both restaurants and third-party vendors — information on what legal wrangling would be required to separate the delivery of meal preparation kits as opposed to fully prepared meals and for the potential impacts of more specifically capping delivery service fees instead of all fees, as the ordinance currently does.
City Manager Roubik Golanian and City Attorney Michael Garcia plan to work on compiling that information for a future meeting.
The council in 2020 enacted a 15% cap on all fees associated with food order deliveries by third parties such as Uber Eats, DoorDash and Grubhub, as a response to the forced closure of dine-in services during the pre-vaccine era of the COVID-19 pandemic and local restaurants’ complaints that steep fees were cutting into what little profits are gleaned from food service.
With restaurants having been able to return to full capacity for more than a year now, the council considered a measure this week to “basically go back to the status-quo as it was before COVID,” Garcia said, “since dining rooms are open at full capacity and have been for some time now.”
As written, the ordinance remains in effect with the city’s COVID-19-based state-of-emergency order, which is still enacted.
Clearly, there is some thought that it’s time to move on from this regulation.
“My intention was initially to answer the challenges of COVID,” said Mayor Ardy Kassakhian, “not necessarily to get in and regulate that market.”
Similar caps enacted in Burbank, Los Angeles and Pasadena have lapsed, as they were written to expire under other circumstances that have since occurred. However, other cities throughout the country — San Francisco, New York, Philadelphia and Minneapolis, as examples — have kept their caps permanent.
Councilman Dan Brotman wondered whether it was worth maintaining a cap here, given that none of the vendors left the Glendale market.
“If it had no impact, it kind of tells me we have a bit of a monopoly or oligopoly situation here and they are perfectly able to operate in this market, profitably, with the cap, and if that’s the case, maybe there are grounds to keep it in place,” he said. “I’m not saying I want to keep it in place, necessarily, but I am interested in hearing whether there’s been any impact either here or another jurisdiction from these moves that the cities made.”
There was general agreement that, should the city retain a cap, it ought to decouple delivery fees from other unrelated charges for other services and regulate just the delivery portion.
“My view would be to definitely change that,” Brotman said.

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