City Council adopts ordinance to cap third-party food delivery service fees

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    PORTLAND, OR (KPTV) — On Wednesday the Portland City Council adopted an ordinance that puts a cap on third-party food delivery service fees.

The council put the temporary emergency limitations in place to help Portland restaurants who are struggling during the COVID-19 pandemic.

FOX 12 spoke with Vinh Wong, the owner of Pho Van Fresh, a Vietnamese restaurant in northwest Portland.

It’s not business as usual for the restaurant. Wong has had to adapt during the pandemic with socially distanced seating, which has expanded to the street.

“Right now we have five outdoor tables,” Wong said. “And with days like this and also the warmer weather, it will help for sure.”

He’s also now using another tool that he wasn’t using before the pandemic.

“We added three of them:Grubhub, Postmates and DoorDash,” Wong said.

Wong says he has had no choice but to add food delivery service through third-party apps to their business, because for months it’s been only takeout.

But Wong says that comes with high service fees that are more than 20 percent.

“With that and the fees so high, we definitely have to pass that along to our customers,” Wong said. “And it’s something that we don’t want to do, but at the same time, it’s something we have to do.”

That’s why the Portland City Council adopted an ordinance Wednesday to cap third-party app-based food delivery service fees.

According to city leaders, if a third party company includes delivery in its services, there’s a 10 percent cap on service fees that the restaurant must pay to the third-party company.

If a third-party company does not include delivery, there’s a five percent cap on those fees.

Portland City Council adopts ordinance to cap third-party food delivery service fees.

Wong says this will bring down the prices for everyone.

“I think people still rely heavily on those services because I think the cases in Portland are still spiking, and I don’t think people are coming back to dining in anytime soon,” Wong said.

The Portland City Council conversation on Wednesday focused on how this ordinance will particularly help restaurants owned by people of color, including those in the Jade District.

The Jade District is a 10-block area surrounding Southeast 82nd Avenue and Southeast Division Street, which is known for its Asian cuisine.

Wong’s family owns two other restaurants, one of which is in that district.

But not everyone is on board with the ordinance. During the Portland City Council meeting Wednesday morning, a driver for DoorDash shared her concerns.

“Like many other people, I need this income right now to make ends meet,” the driver said. “And any kind of law like this one that the city council is proposing to put a limit on the amount that delivery companies can charge restaurants for delivery services would directly hurt workers like me.”

Commissioner Chloe Eudaly’s office who introduced this ordinance said third-party companies are not allowed to reduce how much delivery drivers are being paid.

There is a $500 penalty for companies who violate these caps. The ordinance will remain in effect until 90 days after the COVID-19 State of Emergency has ended.

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