Bill Text: NY S09046 | 2019-2020 | General Assembly | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Limits third-party food delivery service charges during COVID-19.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced - Dead) 2020-10-19 - PRINT NUMBER 9046A [S09046 Detail]

Download: New_York-2019-S09046-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          9046

                    IN SENATE

                                    October 13, 2020
                                       ___________

        Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
          printed to be committed to the Committee on Rules

        AN ACT to amend the general business law,  in  relation  to  third-party
          food  delivery  service charges during COVID-19; and providing for the
          repeal of such provisions upon the expiration thereof

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Legislative  findings  and intent. The legislature hereby
     2  finds that on March 7, 2020, the governor of New York declared  a  state
     3  of  emergency  related  to the COVID-19 pandemic; and has issued various
     4  emergency  directives  related  to  the  COVID-19  pandemic  that   have
     5  restricted  the ability of restaurants and other food providers to fully
     6  operate their businesses.
     7    These social distancing measures required to mitigate  the  spread  of
     8  COVID-19  means  that delivery and take-out options from restaurants and
     9  other food establishments are critical to the public's accessibility  of
    10  food and addressing any community food insecurity.
    11    Restaurants  and  other  food  establishments  are restricted in their
    12  ability to fully utilize their dine-in capabilities  and  the  resultant
    13  reliance  on  take-out  and  delivery service places a sudden and severe
    14  financial strain on many establishments,  particularly  those  that  are
    15  small,  independently  owned  or  minority-owned businesses that already
    16  operate on thin margins. Adding to financial pressures in  the  industry
    17  that  predate  the  current  public  health  crisis, it is in the public
    18  interest to take action to maximize restaurant revenue from delivery and
    19  pick-up orders to enable these businesses to survive the impacts of  the
    20  COVID-19  pandemic  and  continue  supporting  a  diverse  workforce and
    21  contributing to the vitality of our community.
    22    Therefore, it is the intent of the legislature to create  a  statewide
    23  policy  and  fee structure for third-party food delivery services during
    24  the state declared COVID-19 emergency while food service  establishments
    25  have capacity restrictions.
    26    § 2. The general business law is amended by adding a new section 391-v
    27  to read as follows:

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD17385-02-0
        S. 9046                             2

     1    § 391-v. Third-party food delivery service charges during COVID-19. 1.
     2  Definitions.    For  purposes of this section, the following terms shall
     3  have the following meanings:
     4    (a)  "Declared emergency" means the period during which a state disas-
     5  ter emergency has been declared by the governor that results in  limita-
     6  tions  on on-premises dining for restaurants as a result of the COVID-19
     7  pandemic.
     8    (b) "Delivery fee" means a fee charged by a third-party food  delivery
     9  service  for  providing a food service establishment with a service that
    10  delivers food from such establishment to customers. Delivery  fee  shall
    11  not  include  any  other  fee  that may be charged by a third-party food
    12  delivery service to a food  service  establishment,  including  but  not
    13  limited  to, fees for listing or advertising the food service establish-
    14  ment on the third-party food delivery service platform or  fees  related
    15  to processing the online order.
    16    (c)  "Food service establishment" means a place where food is prepared
    17  and intended for individual portion service and  includes  the  site  at
    18  which  such individual portions are provided, whether consumption occurs
    19  on or off the premises. Food service  establishment  shall  not  include
    20  food  processing establishments, retail food stores, private homes where
    21  food is prepared or served for  family  consumption,  and  food  service
    22  operations  where  a  distinct group mutually provides, prepares, serves
    23  and consumes the food, including but  not  limited  to,  a  covered-dish
    24  supper limited to a congregation, club or fraternal organization.
    25    (d)  "Online  order"  means any order placed by a customer through, or
    26  with the assistance of, a platform provided by a third-party food deliv-
    27  ery service, including but not limited to, a telephone order.
    28    (e) "Purchase price" means the total price of the items  contained  in
    29  an  online  order that are listed on the menu of the food service estab-
    30  lishment where such order is placed.  Purchase price shall  not  include
    31  taxes,  gratuities and any other fees that may make up the total cost to
    32  the customer of an online order.
    33    (f) "Third-party food delivery  service"  means  any  website,  mobile
    34  application  or  other  internet service that offers or arranges for the
    35  sale and same-day delivery or same-day  pickup  of  food  and  beverages
    36  prepared  by no fewer than twenty food service establishments located in
    37  the state that are owned and operated by different persons.
    38    2. Fee limits during declared emergencies.  (a)  No  third-party  food
    39  delivery  service shall charge a food service establishment any combina-
    40  tion of fees, commissions or costs, including a delivery fee,  for  such
    41  third-party food delivery service's services that total more than twenty
    42  percent  of the purchase price of an online order plus credit card proc-
    43  essing fees.
    44    (b) No third-party food delivery service shall charge a  food  service
    45  establishment  a  delivery  fee that totals more than fifteen percent of
    46  the purchase price of an online order.
    47    (c) No third-party food delivery  service  shall  reduce  the  compen-
    48  sation,  including  but not limited to, any tip or gratuity, paid to any
    49  worker as a result of fees charged during the declared emergency.
    50    3. Penalties and enforcement. Whenever there shall be a  violation  of
    51  this  section, an application may be made by the attorney general in the
    52  name of the people of the state of New York to a court or justice having
    53  jurisdiction to issue an injunction to enjoin and restrain  the  contin-
    54  uance  of  such violation; and if it shall appear to the satisfaction of
    55  the court or justice that the defendant  has,  in  fact,  violated  this
    56  section, an injunction may be issued by such court or justice, enjoining
        S. 9046                             3

     1  and  restraining any further violation, without requiring proof that any
     2  person has, in fact, been  injured  or  damaged  thereby.  In  any  such
     3  proceeding,  the  court  may make allowances to the attorney general and
     4  direct  restitution  of  an  amount  not  to  exceed  the amount of fees
     5  collected in violation of this section by a  third-party  food  delivery
     6  service,  attorneys' fees, and such other remedies as the court may deem
     7  appropriate. Whenever the court shall determine that a violation of this
     8  section has occurred, the court may impose a civil penalty of  not  more
     9  than  one  thousand  dollars for each violation. Each day a violation of
    10  this section is continued and each food service establishment charged  a
    11  fee  in violation of this section shall constitute a separate violation.
    12  In connection with any such proposed application the attorney general is
    13  authorized to take proof and make a determination of the relevant  facts
    14  and  to  issue  subpoenas  in accordance with the civil practice law and
    15  rules.
    16    4. Preemption.  At all times, whether or not a declared  emergency  is
    17  in  effect,  the  provisions of this section shall supersede and preempt
    18  any county or municipal or other local law,  ordinance,  resolution,  or
    19  regulation concerning the relationship between a third-party food deliv-
    20  ery service and any food service establishment utilizing its services.
    21    §  3. This act shall take effect seven days after it shall have become
    22  a law provided that the provisions of  this  act  shall  expire  and  be
    23  deemed  repealed  upon the expiration of the declared state of emergency
    24  relating to the novel coronavirus  (COVID-19);  and  provided,  further,
    25  that  the superintendent of financial services shall notify the legisla-
    26  tive bill drafting commission upon occurrence of the expiration  of  the
    27  state  disaster emergency declared by executive order number 202 and any
    28  further amendments or modifications, and  as  may  be  further  extended
    29  pursuant  to  section 28 of the executive law, in order that the commis-
    30  sion may maintain an accurate and timely  effective  data  base  of  the
    31  official  text  of  the  laws of the state of New York in furtherance of
    32  effectuating the provisions of section 44 of  the  legislative  law  and
    33  section 70-b of the public officers law.