HomeMy WebLinkAbout119-R-20A Resolution Establishing Limits On Third -Party Food Delivery Service Fees11 /17/2020
119-R-20
A RESOLUTION
ESTABLISHING LIMITS ON THIRD -PARTY FOOD DELIVERY SERVICE
FEES
WHEREAS, the City of Evanston, Cook County, Illinois ("City"), is a home rule
unit of government and, pursuant to the provisions of Section 6(a) of Article VII of the
Illinois Constitution, may exercise any power and perform any function pertaining to its
government and affairs; and
WHEREAS, on March 13, 2020, the President of the United States
declared a national emergency concerning the Novel Coronavirus Disease ("COVID-
19") outbreak; and
WHEREAS, on March 9, 2020, the Governor of Illinois issued a disaster
proclamation for the State of Illinois concerning the COVID-19 outbreak that is to last 30
days; and
WHEREAS, on March 15, 2020, the Mayor declared a state of emergency
due to the COVID-19 outbreak pursuant to Section 9-9-3 of the City Code; and
WHEREAS, the Evanston City Council has extended the state of
emergency due to the persistence of the COVID-19 outbreak; and
WHEREAS, the Governor of Illinois has issued successive Executive
Orders mandating individuals living in Illinois shelter at home and requiring all non-
essential business activities and operations to cease; and
119-R-20
WHEREAS, in order to reduce the spread of the COVID-19 virus and
protect public health, restaurants in the City are limited in their dine -in services, making
restaurants reliant on delivery, drive -through, and take-out options; and
WHEREAS, many consumers use third -party applications and websites to
place orders with restaurants for delivery and takeout, and these third -party platforms
charge restaurant fees; service agreements between some restaurants and third -party
platforms provide that the platform charges the restaurant 10% of the purchase price
per order, while some agreements provide for higher per -order fees; and
WHEREAS, restaurants and especially small business restaurants, have
limited bargaining power to negotiate lower fees with third -party platforms, given the
high market saturation of third -party platforms, and the financial pressures small
business restaurants are facing during the state of emergency; and
WHEREAS, capping the per -order fees at 15% will accomplish the
legitimate public purpose of easing the financial burden on struggling restaurants during
this emergency while not unduly burdening third -party platforms, as this fee is
reasonable and third -party platforms continue to earn significant profits.
NOW BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
EVANSTON, COOK COUNTY, ILLINOIS, THAT:
SECTION 1: It shall be unlawful for a third -party food delivery service to
charge a covered establishment a fee per online order for the use of its services that
totals more than 15% of the purchase price of such online order.
(a) For purposes of this Resolution, the following definitions apply:
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119-R-20
"Covered establishment" means a restaurant that offers, in a single
commercial transaction over the internet, whether directly or through a third -party
food delivery service, the sale and same -day delivery of food to customers from
one or more retail locations within the City.
"Online order" means an order placed by a customer through a platform
provided by a third -party food delivery service for delivery or pickup within the
City.
"Purchase price" means the menu price of an online order. Such term
excludes taxes, gratuities, and any other fees that may make up the total cost to
the customer of an online order.
"Third -party food delivery service" means any website, mobile application,
or other internet service that offers or arranges for the sale of food and
beverages prepared by, and the same -day delivery or same -day pickup of food
and beverages from, no fewer than 20 separately owned and operated food
service establishments.
SECTION 2: This Resolution 119-R-20 will be in full force and effect from
and after the date of its passage and approval in the manner provided by law.
Attest:
C�
Devon Reid, City Clerk
Adopted: November23 , 2020
M\4y-u�-
Stephen H. Hagerty, Mayor
Approved as to form:
Kelley A. Gandurski, Corporation Counsel
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