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Committee advances amendments to cap delivery‑app fees at 15% and require written agreements
Summary
The committee accepted substantive amendments to an ordinance that would cap third‑party delivery commissions at 15%, require written agreements before apps list restaurants, allow contract termination within 72 hours and include a two‑year sunset. The ordinance was continued as amended to Oct. 22 for further work on penalties and implementation.
San Francisco’s Public Safety and Neighborhood Services Committee on Oct. 8 approved substantive amendments to an ordinance that would cap commissions charged to restaurants by third‑party delivery platforms and set new rules for contracts and termination.
The committee accepted amendments that raise a proposed commission cap from 10% to 15%, authorize a separately itemized point‑of‑sale processing fee of up to 3%, require written agreements before apps can list restaurants, and require delivery services to terminate a restaurant’s contract within 72 hours of a restaurant’s notice. The sponsor and staff framed the measure as part of pandemic recovery for restaurants and as temporary relief, proposing a two‑year sunset on the rules.
Lee Heffner, who outlined the draft amendments to the committee, said the 15% cap aligns with a mayoral emergency declaration and that the package would restore restaurants’ ability to set menu prices inside apps. Heffner also described the 72‑hour termination requirement and a new written‑agreement rule intended to eliminate listings and inaccurate menus where restaurants had not consented to being on an app.
Representatives of the restaurant industry and delivery platforms commented during the public‑comment period. Brent Westcott, a legislative policy adviser at DoorDash, asked the committee to clarify that restaurants could opt into optional marketing programs and proposed exempting formula retail; Chavi Phani of the Golden Gate Restaurant Association said the restaurant community generally supports a 15% cap and the proposed two‑year sunset, calling the cap necessary for continued recovery.
Vice Chair Catherine Stephanie questioned whether the proposed $1,000 per‑violation penalty in the draft is a sufficient deterrent, citing experience with other ordinances where low fines have not produced compliance. Heffner said the penalty figure had not been central to negotiations and offered to consult the city attorney about how high fines can lawfully go; he emphasized a compliance‑focused approach.
Because members made substantive amendments, the committee voted to continue the item as amended to the Oct. 22 meeting to allow additional work on implementation, enforcement and penalty levels.
The measure remains in committee; staff and sponsors said they would continue stakeholder outreach and technical drafting ahead of the Oct. 22 continuation.
