Legislation in the works to cap fees on food delivery services

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ALBANY, N.Y. (NEWS10) — An Albany County lawmaker is developing a proposal to cap fees charged to restaurants from food delivery services like GrubHub.

Legislator Sam Fein said this proposed cap would expire at the end of the pandemic’s current state of emergency order.

“A lot of people don’t realize that [food delivery services] charge upwards often of 30 percent or more on each order. So 30 percent on an order is going to these apps rather than restaurants that need our support,” Fein said.

Fein said he’s not opposed to keeping the cap on fees permanent if the legislation passes.

About 95 percent of Savoy Taproom’s service is now delivery. General Manager Trudy Steier has seen a steep increase in orders from GrubHub, but the restaurant has not seen much of the profits.

“It’s a bit of a Catch 22 for most restaurants because all though they take 20 to 30 percent for delivery fees that we lose, when people are looking for food, UberEats and GrubHub are really the sites the go to,” Steier said.

In a recent Facebook post, Savoy owner Jason Pierce posted an itemized list of fees for a $43 order. For that particular order, the restaurant only saw $26.97 of the final bill.

GrubHub responded to the concern of high fee charges from business after this story aired.

A representative explained GrubHub’s fee structure starts at 10 to 15 percent for a negotiable marketing fee, another 10 percent for using their delivery drivers, and an additional three percent processing fee.

The proposed bill will be brought to the county as early as the end of December.

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