ORDINANCE NO. 23-O-2873
AN ORDINANCE OF THE CITY OF BEVERLY HILLS AUTHORIZING THE CITY MANAGER TO REMOVE CERTAIN CURBSIDE PICKUP ZONES, READOPTING CITY MANAGER AUTHORITY TO ISSUE PERMITS FOR OUTDOOR DINING, READOPTING WAIVER OF SPECIAL EVENT PERMIT FEES AND REQUIREMENTS FOR OUTDOOR DINING AND ADDING ARTICLE 8 TO CHAPTER 4 OF TITLE 4 OF THE BEVERLY HILLS MUNICIPAL CODE
THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:
WHEREAS, international, national, state and local health and governmental authorities have responded to an outbreak of respiratory disease caused by a novel coronavirus named “SARSCoV-2” and the disease it causes has been named “coronavirus disease 2019,” abbreviated COVID-19, (“COVID-19”); and
WHEREAS, on March 15, 2020, the City Manager, in his role as the Director of Emergency Services, proclaimed the existence of a local emergency pursuant to Section 2-4-107 of the Beverly Hills Municipal Code to ensure the availability of mutual aid and an effective City response to the novel coronavirus (“COVID-19”) and that state of emergency was ratified by the City Council on March 16, 2020 (“local state of emergency”); and
WHEREAS, restaurants located within the City were prohibited from offering dine-in service, limiting restaurants to delivery and takeout offerings only, which placed a sudden and severe financial strain on many restaurants, adding to the financial pressures in the industry that predated the COVID-19 crisis. In response, the City of Beverly Hills adopted measures to try to mitigate the impacts of the pandemic on businesses in the City by waiving certain fees, and authorizing the use of parking spaces and street closures for temporary outdoor dining spaces and pick-up operations, as well as regulating fees imposed on restaurants by Third-Party Food Delivery services; and
WHEREAS, upon the end of the local state of emergency, these measures shall cease to be effective; and
WHEREAS, the City Council finds that designated curbside pickup zones have benefited both local businesses and their consumers, but some zones have also reduced parking availability and increased traffic congestion in the City, been misused by businesses for purposes other than order pick-ups, and may no longer be necessary to support businesses’ pick-up operations; and
WHEREAS, outdoor dining generates business and creates vibrant community spaces in the City. The City Manager’s continued ability to issue street closure and other permits, and the waiver of Special Event Permit fees and other requirements, will facilitate outdoor dining and benefit both businesses and consumers alike; and
WHEREAS, the use of third-party applications and websites to place orders with restaurants for delivery and takeout remains popular amongst consumers even after in-person dining has resumed; and
WHEREAS, prior to the City’s emergency regulations, third-party platforms often charged restaurants fees ranging from 30% to 40% of the purchase price per order; and
WHEREAS, restaurants, and particularly restaurants that are small businesses, have limiting bargaining power to negotiate lower fees with third-party platforms, given the high market saturation of third-party platforms; and
WHEREAS, permanently capping per-order fees will ensure restaurants in the City receive reasonable revenue from orders placed by consumers, while not unduly burdening third-party platforms that continue to be in high demand.
Section 1. The City Manager is authorized to review existing curbside pickup zones and remove zones that meet one or more of the following conditions:
the curbside pickup zone is no longer reasonably necessary to accommodate the business needs of the nearby businesses;
the demand for parking in the immediate area outweighs the demand for a curbside pickup zone;
the curbside pickup zone significantly impacts traffic in the area; or
a nearby business has misused the curbside pickup zone.
Section 2. The City Manager is authorized to issue street closure permits and any other permits necessary to allow for temporary outdoor dining.
Section 3. The City shall waive fees associated with a Special Event Permit for temporary outdoor dining and shall waive the minimum ten (10) day period for filing an application for a Special Event Permit for temporary outdoor dining.
Section 4. Article 8 (“Third-Party Food Delivery Services”) is hereby added to of Chapter 4 (Other Regulations for Specific Types of Businesses and Activities) of Title 4 (Regulation of Certain Types of Businesses and Activities) of the Beverly Hills Municipal Code to read as follows:
“Article 8. Third-Party Food Delivery Services
Section 4-4-801. Definitions.
Delivery Fee: A fee charged by a Third-Party Food Delivery Service for providing a Retail Food Establishment with a service that delivers food and beverages from such establishment to customers. The term does not include any other fee or cost that may be charged by a Third-Party Food Delivery Service to a Retail Food Establishment, such as fees for listing or advertising the Retail Food Establishment on the Third-Party Food Delivery Service platform or fees related to processing the online order including, but not limited to service fees, fees for facilitating Online Orders for pick-up, and credit card processing fees.
Online Order: An order placed by a customer, including a phone order, for delivery or pick-up from a restaurant located within the City.
Purchase Price: The menu price of the items contained in an Online Order, minus any applicable coupon or promotional discount provided to the customer by the restaurant through the Third-Party Food Delivery Service. Such term therefore excludes taxes, gratuities and any other fees or costs that may make up the total amount charged to the customer of an Online Order.
Retail Food Establishment: A restaurant, delicatessen, bakery, coffee shop, or other eat-in or carry-out service of processed or prepared raw and ready-to-eat food or beverages.
Third-Party Food Delivery Service: Any website, mobile application or other internet service that offers or arranges for the sale of food and beverages prepared by, and the delivery or pick-up of food and beverages from no fewer than twenty (20) separately owned and operated food service establishments.
Section 4-4-802. Prohibitions.
It shall be unlawful for a Third-Party Food Delivery Service to do the following:
Charge a Retail Food Establishment a Delivery Fee that totals more than fifteen percent (15%) of the Purchase Price of each Online Order.
Charge a Retail Food Establishment any amount designated as a Delivery Fee for an Online Order that does not involve the delivery of food or beverages.
Charge a Retail Food Establishment any combination of fees, commissions, or costs for the Retail Food Establishment’s use of the Third-Party Food Delivery Service that is greater than five percent (5%) of the Purchase Price of each Online Order or to charge any amount of fees, commissions, or costs for the Retail Food Establishment’s use of the Third-Party Food Delivery Service unless the contract between the Retail Food Establishment and the Third-Party Food Delivery Service allows for fees, commissions, and costs other than a Delivery Fee. For the purpose of this subsection, fees, commissions, or costs do not include the Delivery Fee, which is capped at fifteen percent (15%).
Charge a Retail Food Establishment any fee, commission, or cost other than as permitted in subsections A through C, above.
Charge a customer any Purchase Price for a food or beverage item that is higher than the price imposed by the Retail Food Establishment on the Third-Party Food Delivery Service or, if no price is imposed by the Retail Food Establishment on the Third-Party Food Delivery Service, the price listed on the Retail Food Establishment’s own menu.
Retain any portion of amounts designated as a tip or gratuity. Any tip or gratuity shall be paid by the Third-Party Food Delivery Service, in its entirety, to the person delivering the food or beverages.
Section 4-4-803. Disclosures.
The Third-Party Food Delivery Service shall disclose to the customer an accurate, clearly identified, and itemized cost breakdown of each transaction, including, but not limited to the following:
The Purchase Price of the food and beverages at the cost listed on the Retail Food Establishment’s menu.
The Delivery Fee charged to the Retail Food Establishment.
Each fee, commission, or cost, other than a Delivery Fee, charged to the Retail Food Establishment.
Each fee, commission, or cost, other than the Delivery Fee or the Purchase Price of the food, charged to the customer by the Third-Party Food Delivery Service.
Any tip or gratuity that will be paid to the person delivering the food or beverages.
Section 4-4-804. Violations.
If a Third-Party Food Delivery Service charges a Retail Food Establishment fees that violate this Section, the Retail Food Establishment shall provide written notice to the Third-Party Food Delivery Service requesting a refund within seven days. If the Third-Party Food Delivery Service does not provide the refund requested after seven days or the Third-Party Food Delivery Service continues to charge fees in violation of this Section after the initial notice and seven-day cure period, a Retail Food Establishment may enforce this Section by means of a civil action seeking damages and injunctive relief. The prevailing party in any such action shall be entitled to an award of reasonable attorney fees.”
Section 5. Sections 1 through 3 of this Ordinance shall not be codified.
Section 6. CEQA. This Ordinance is exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15061(b)(3) which is the general rule that CEQA applies only to projects which have the potential to cause a significant effect on the environment, and CEQA does not apply where it can be seen with certainty that there is no possibility that the activity may have a significant effect on the environment. It can be seen with certainty that granting the City Manager the authority to remove certain curbside pickup zones, and the continued waiver of Special Event Permit fees and requirements and grant of authority to the City Manager to issue permits for temporary outdoor dining, as well as the enactment of regulations on third-party food delivery services will not cause a significant effect on the environment. In addition, these regulations do not constitute a project that is subject to the provisions of CEQA, pursuant to CEQA Guidelines Section 15378(b)(2) and (b)(5).
Section 7. Severability. If any provision of this Ordinance is held invalid by a court of competent jurisdiction, such provision shall be considered a separate, distinct and independent provision and such holding shall not affect the validity and enforceability of the other provisions of this Ordinance.
Section 8. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the city within fifteen (15) days after its passage in accordance with Section 36933 of the Government Code, shall certify to the adoption of this Ordinance and shall cause this Ordinance and the City Clerk’s certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City.
Section 10. Certification. This City Clerk shall certify to the adoption of this Ordinance.
Adopted: March 7, 2023
Effective: March 8, 2023
LILI BOSSE
Mayor of the City of Beverly Hills, California
Mayor of the City of Beverly Hills, California
ATTEST:
(SEAL)
HUMA AHMED
City Clerk
HUMA AHMED
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:
LAURENCE S. WIENER NANCY HUNT-COFFEY
City Attorney City Manager