Title
AN ORDINANCE ENACTING A NEW ARTICLE IV IN CHAPTER 9 OF THE COMMERCE CITY REVISED MUNICIPAL CODE TO ESTABLISH A TEMPORARY MAXIMUM FEE THAT CAN BE CHARGED FOR THIRD-PARTY FOOD DELIVERY SERVICES IN THE CITY OF COMMERCE CITY, COLORADO
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Summary and Background Information:
Restaurants all around the world are struggling during the COVID-19 pandemic and many are in danger of closing. The National Restaurant Association estimates that the COVID-19 pandemic will result in $225B in lost revenue and the elimination of 5-7 million jobs in restaurants.
There are over 80 restaurants in Commerce City, including full-service, quick service and fast food. All restaurants in Colorado were ordered to close their dining rooms on March 16, 2020 and they remained closed until June 19, 2020. At this time, the Colorado Department of Public Health and Environment (CDPHE) allowed restaurants to reopen their dining rooms at 50% their normal capacity. CDPHE began the DIAL or county tiered system on September 15, 2020 and on October 28, 2020, due to rising COVID cases, Adams County went to a Safer at Home Level 3 tier which further limits in-dining capacity from 50% to 25%.
Due to restaurants in Commerce City currently only able to have 25% of their normal in-dining capacity, many have or are looking at increasing food delivery options. Some restaurants are utilizing third party delivery apps companies to offer delivery service to customers, such as GrubHub, Postmates, Door Dash or Uber Eats . A report from eMarketers said that 40 million Americans used a food delivery app in 2019. That number has likely risen exponentially in the past few months, due to the coronavirus pandemic.
Reportedly, this is how the delivery app business model works:
Customer pays a delivery fee ($5-10 per order)
Customer pays a tip to delivery driver (typically 15-20%)
Restaurant pays up to 15-35% commission on each order
Restaurant may pay additional fees for on-line marketing support
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