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View Winners → Restaurants Get a Little Temporary Help from Pasadena City Council
News Jul 23, 2020
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Third-party food delivery companies ordered to cut fees
Restaurants,one of the hardest hit industries even before this pandemic, were facingadditional punishment when they were ordered to do take-out only and no moreindoor dining was allowed.
Whiletake-out business for some works, most restaurants suffer additional injurywhen it comes to the proliferation of third-party food delivery services whichtake an average of 25-30 percent for each order from the eatery.
In recentmonths, more and more restaurants have felt the sting of services like Grubhub,DoorDash, etc., and hope to increase their already slim margin to stay afloat.
The Pasadenacouncil on Monday unanimously approved a ceiling of 20 percent on deliveryservices that work within the city limits. Councilman Victor Gordo said it wasnecessary to put a cap on the services to avoid price gouging.
Gordo saidcurbside pickup is preferable for all concerned and especially to therestaurant.
Thethird-party services also have been accused of grabbing tips. Tips were alsoprotected by council for this temporary period, ensuring they land in the handsof delivery drivers.
The 20percent cap figure represents a change from the 15 percent total cap that wasoriginally recommended to the council in a staff report prepared by CityManager Steve Mermell.
Michelle Garrett, project manager for the city’s Department of Economic Development, said the late change came about to mirror the cap the L.A. County Board of Supervisors passed on Tuesday.
Mayor Terry Tornekwas concerned, however, that the ordinance might prevent these third-partyservices from working in Pasadena. Staff felt that these businesses would stilloperate despite the cap.
CouncilmemberSteve Madison stated that third-party delivery systems and the way tips arehandled is a complex issue and he felt a little uncomfortable with theemergency ordinance. Gordo agreed with Madison regarding the complexity andvowed to evaluate the cap after the 90-day period.
The council mutuallyagreed to the price gouging ceiling cap for 90 days.
