Are delivery apps gouging Fresno restaurants? City Council limits fees during COVID-19
The Fresno City Council placed a moratorium on evictions for small businesses amid the coronavirus pandemic on Thursday, and set limits on fees from apps used to order food.
The moratorium on evictions, which also applies to home renters, is in place until 90 days after the city repeals its emergency orders related to COVID-19.
Councilmembers Mike Karbassi and Luis Chavez co-sponsored the act.
Tenants must notify a landlord in writing, which could include email or text message, and then have 10 days to provide proof that their business has been affected by the coronavirus pandemic. Tenants have up to six months to pay the rent that is deferred.
“This essentially mirrors the provisions that we approved for residential folks in making sure we can keep those small businesses afloat,” Chavez said. “Giving them the opportunity to regain some of the lost revenue.”
Indoor dining plea; limiting food delivery app costs
Among businesses hurting under the pandemic, restaurants have been a point of contention publicly.
The majority of the City Council and Mayor Lee Brand sent a letter Thursday to Gov. Gavin Newsom to ask him to consider rolling back some orders that don’t allow indoor dining.
The same day, the council restricted how much third-party apps like Grubhub or DoorDash can charge a restaurant and its consumers. Supporters of the restrictions noted businesses are already struggling.
Karbassi said some restaurant owners have called third-party fees “price gouging.”
Under the new order, the apps cannot charge an eatery more than 15% for a delivery fee nor can it charge a delivery fee if no actual delivery is involved. Other fees cannot add up to more than 5%.
“It allows (apps services) to be profitable, but it still gives our restaurants a fighting chance,” Karbassi said. “The margins for restaurants are so low.”
The apps also are not allowed to charge consumers fees for food and drinks that are higher than those set by the restaurant. Tips left on an app must also go to a driver and cannot be taken by the app service.
Those restrictions also remain in place until 90 days after the coronavirus emergency is deemed over. Violations can lead to fines from $1,000 to $10,000.
This story was originally published September 17, 2020 at 5:13 PM.
