Pa. lawmakers look to take a bite out of food delivery fees paid by restaurants | Friday Morning Coffee

July 2, 2021 7:13 am

(A scheduling note: We’ll  be off Monday, July 5, in observance of the July 4 holiday. We’ll be back to business on Tuesday, July 6. See you all very soon.) 

Good Friday Morning, Fellow Seekers.

If you were like a lot of hungry consumers during the pandemic, the chances are pretty good that you used DoorDashGrubHub, or some other food delivery service to get a meal from your favorite restaurant delivered to your dining room table.

But while you rejoiced in the convenience, restaurant owners were grumbling about the mixed blessing of a service that helped them keep their doors open, even as they paid up to 30 percent in delivery fees per order, cutting deeply into their bottom line.

But, as our news partners at Pittsburgh City Paper report, state lawmakers are now getting involved, and hope to resolve through legislation, what market forces could not.

Legislation now before the state House would cap third-party food delivery app fees at 15 percent.

It also would ban “practices that delivery apps use to manipulate small businesses by requiring that a delivery app have an agreement with the restaurant prior to delivering food from that restaurant,” Democratic Reps. Sara Innamorato and Nick Pisciottano, both of Allegheny County, wrote in a memo seeking sponsors for their proposal.

“During the pandemic, food delivery services have multiplied and it is now common to have food from our favorite restaurants delivered in a contact-less delivery to our doorstep,” the two lawmakers wrote.

“While these services are convenient, fees charged by the delivery apps can be exorbitant and eat into the profits of locally-owned restaurants,” they continued. “While franchised restaurant chains can leverage their large footprint to drive down fees from delivery services, small restaurants do not have the same market power and can be charged processing fees … that decimate already-thin profit margins.”

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As City Paper reports, the bill can’t come soon enough for some Pittsburgh restaurateurs, who say they’ve been laboring under the weight of these delivery fees for too long.

“I don’t believe the government should regulate fees,” Mike Murphy, the owner of Carson Street Deli, told City Paper. “Having said that, I’m making an exception. Regulate the hell out of it, because they’ve hurt some people.”

Murphy told City Paper that delivery apps will change the placement of an establishment’s listing on the app, depending on the percentage of delivery fees the establishment is willing to pay. Establishments willing to pay higher fees are placed higher up, while those who pay lower fees can fall to second or third pages, City Paper reported.

Murphy told City Paper that he doesn’t mind where his deli is placed in search results, since he says customers will seek out his restaurant specifically on third-party apps. But he’s also managed to negotiate lower fees with the delivery apps, City Paper reported.

But not all business owners are quite so lucky, City Paper reports. And that’s where the legislative remedy comes into play.

“As we move closer to a post-pandemic economy, we should protect small business owners by guarding against unfair fees and defending their autonomy from unscrupulous tech companies,” Innamorato and Pisciottano wrote in their ‘Dear Colleague‘ memo.

The bill is now before the House Consumer Affairs Committee.

The Pennsylvania Capitol building. (Capital-Star photo by Sarah Anne Hughes)

Our Stuff.
Cocktails to-go helped Pa. businesses stay afloat. Now they’re in for an even slower recoveryMarley Parish reports.

As expected, Gov. Tom Wolf has vetoed legislation banning Pa. primary schools and colleges from requiring COVID ‘vaccine passports,’ Stephen Caruso reports

Inmates at a state prison in Montgomery County have staged a hunger strike to call attention to what they say are inhuman conditions at their facility, and to call for the end to solitary confinement across the prison system, Correspondent Josh Vaughn reports.

HIV testing at non-health care sites in Philadelphia plummeted in 2020, our news partners at the Philadelphia Tribune report.

On our Commentary Page this morning: Two Indiana University scholars explain how Benjamin Franklin had to combat anti-vaccination sentiment in the midst of smallpox outbreak.

En La Estrella-Capital, el ex-Gov. de Pa. Ridge fue dado de alta del hospital, recuperándose de un derrame cerebralY un proyecto de ley de Pa. que reforma la ley de marihuana medicinal, sin provisión de cultivo en casa, se dirige a Wolf.

(Sylvia Owusu-Ansah, an emergency department physician at UPMC Children’s Hospital of Pittsburgh, receives Pfizer’s COVID-19 vaccine, Mon., 12/14/20)

One million Pennsylvanians have missed their second shot, the Inquirer reports.

Residents of Wilkinsburg, Pa. have spoken out against a proposed merger with Pittsburgh, the Post-Gazette reports.

Younger Americans — including those in Pennsylvania — are more hesitant about getting the vaccine, slowing efforts toward mass immunity, PennLive reports (paywall).

Coal region school districts, along with Allentown and Reading, are among the most underfunded in the state, the Morning Call reports.

The York Daily Record takes a look at changes to Pennsylvania’s medical marijuana law.

Wilkes University is now requiring students to provide proof of vaccination, the Citizens’ Voice reports.

WHYY-FM explains why Philadelphia District Attorney Larry Krasner is asking the state Supreme Court to change how jurors hear about the state’s use-of-force law.

Hospitality businesses in Centre County are set to receive $1.8 million in relief fundingWPSU-FM reports.

GoErie asks readers how they’re celebrating freedom from COVID this 4th of July weekend (paywall).

PoliticsPA’s readers say Republicans should nominate U.S. Rep. Dan Meuser, R-9th District, for governor in 2022. State Sen. Doug Mastriano, R-Franklin, finished 7th in the reader canvass.

Non-citizens are steadily gaining voting reports.

Roll Call runs down U.S. House Speaker Nancy Pelosi’s picks for the Jan. 6 special commission — including U.S. Rep. Liz Cheney, R-Wyo.

Here’s your #Pennsylvania Instagram of the Day:


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What Goes On
The docket is clear. Enjoy your long holiday weekend.

Gov. Tom Wolf has no public schedule today.

You Say It’s Your Birthday Dept
Best wishes go out this morning to reader Bobby Maggio who celebrates today. Congratulations.

Heavy Rotation
I’ll go out this week with a dance-y track from Noel Gallagher’s High Flying Birds and the greatest hits (so far) comp I’ve been playing quite frequently. Here’s the amazing ‘Holy Mountain.’

Wednesday’s Gratuitous Baseball Link
Boston clobbered the visiting Kansas City Royals 15-1 on Thursday night. Ouch. The Sox are in first place in the AL East, 3.5 games clear of second place Tampa Bay. The Orioles are an awful 23.5 games back in dead last. Sigh.

And now you’re up to date.

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John L. Micek

A three-decade veteran of the news business, John L. Micek is the Pennsylvania Capital-Star's former Editor-in-Chief.