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Resolution 2021-31573 RESOLUTION NO. 2021-31573 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE NEIGHBORHOOD AND QUALITY OF LIFE COMMITTEE,AT ITS JANUARY 28, 2021 MEETING TO AUTHORIZE THE CITY MANAGER TO NEGOTIATE AN AGREEMENT WITH UBER TECHNOLOGIES, INC. D/B/A "UBER EATS" REGARDING CONSUMER DELIVERY FEES IN ORDER TO PROVIDE ECONOMIC RELIEF AND MARKETING SUPPORT TO MIAMI BEACH RESTAURANTS, AND FURTHER AUTHORIZING THE CITY MANAGER AND THE CITY CLERK TO EXECUTE THE FINAL AGREEMENT. WHEREAS, the COVID-19 pandemic has and continues to threaten the Miami Beach restaurant industry, and has forced many restaurants to either close or switch their operations to focus on pickup and delivery; and WHEREAS, although restaurants were authorized to remain open throughout the economic shutdown,the primary restaurant model of in-person dining was restricted, and remains limited even during the reopening phases; and WHEREAS, due to physical distancing guidelines and the continued spread of the COVID- 19 virus, in-person dining has been greatly reduced, and restauranteurs and their patrons have experienced an increased dependency on third party delivery services; and WHEREAS, dependency on takeout and delivery offerings via third-party delivery platforms and websites only has placed a sudden and severe financial strain on many restaurants, particularly those that are small businesses that already operate on thin margins, adding to financial pressures in the industry that predate the COVID-19 crisis; and WHEREAS, service agreements between some restaurants and third-party platforms provide that the platform charges the restaurant 10-15% of the purchase price per order, while some agreements provide for higher per-order fees; and WHEREAS, restaurants, and particularly restaurants that are small businesses with few locations, have limited bargaining power to negotiate lower fees with third-party platforms, given the high market saturation of third-party platforms, and the dire financial straits small business restaurants are facing in this COVID-19 emergency; and WHEREAS, at its September 23, 2020 meeting, the Neighborhood and Quality of Life Committee ("NQLC") discussed the hardships faced by restaurants due to the COVID-19 pandemic, and associated emergency orders and guidelines, and passed a motion directing the City Administration to explore a reimbursement program for Miami Beach restaurants; and WHEREAS, at the September 29, 2020 City Commission meeting, the Mayor and City Commission adopted Resolution No. 2020-31428, adopting the FY 2021 General Fund budget which included an allocation of$60,000 to establish a restaurant reimbursement program to offset expenses incurred by Miami Beach restaurants related to third-party delivery service fees; and WHEREAS, at the October 28, 2020 City Commission meeting, the Mayor and City Commission adopted Resolution No. 2020-31470, accepting the recommendation of the NQLC at its October 19, 2020 meeting, and authorizing the creation of the Miami Beach Restaurant Reimbursement Grant Program, allowing for grants of up to $1,000 to reimburse eligible restaurants for third party commission fees; and WHEREAS, the NQLC and the City Administration have continued to explore additional methods for providing relief to Miami Beach restaurants and consumers, including negotiating a potential partnership with delivery platform Uber Technologies, Inc. d/b/a Uber Eats ("Uber Eats") to address the negative impacts of the COVID-19 pandemic; and WHEREAS, on January 28, 2021, the NQLC passed a motion with a favorable recommendation for a partnership program with Uber Eats, the terms of which are more particularly described in the Uber Eats proposal letter attached as Exhibit "A" to the Commission Memorandum accompanying this Resolution; and WHEREAS, the proposed partnership program includes six(6)weeks of free delivery and promotional discounts for Miami Beach eaters, as well as benefits to Miami Beach restaurants through May 31, 2021 including waiver of marketplace and credit card fees for pick-up orders, reimbursement of delivery fees for restaurants utilizing their own delivery personnel, and waiver of activation fee for new restaurants; and WHEREAS,the partnership also involves joint advertising efforts through digital marketing to include social media, press release and email; and WHEREAS, the City Administration supports the creation of a collaborative partnership between the City and Uber Eats, and recommends that the Mayor and City Commission authorize the City Manager to negotiate an agreement with Uber Eats based on its proposal. NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby accept the recommendation of the Neighborhood and Quality of Life Committee, at its January 28, 2021 meeting, and authorize the City Manager to negotiate an agreement with Uber Technologies, Inc. d/b/a Uber Eats, regarding consumer delivery fees in order to provide economic relief and marketing support to Miami Beach restaurants, and further authorize the City Manager and the City Clerk to execute the final agreement. PASSED and ADOPTED THIS !o day of February 2021. ; 4.:..c>:%, Dan Gelber, Mayor ATTEST: 1tdCORFRAiED s c-X L 2 Q,/?.ctz.l Ra/4C "I E. Grana o, y Clerk AP" .r D AS TO "SRM &+A-- UAGE & F• '0=' ECUTION 3 City Attorney �� p to Resolutions -C7 E MIAMI BEACH COMMISSION MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM: Raul J.Aguila, Interim City Manager DATE: February 10, 2021 SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE NEIGHBORHOOD AND QUALITY OF LIFE COMMITTEE, AT ITS JANUARY 28, 2021 MEETING TO AUTHORIZE THE CITY MANAGER TO NEGOTIATE AN AGREEMENT WITH UBER TECHNOLOGIES, INC. D/B/A "UBER EATS" REGARDING CONSUMER DELIVERY FEES IN ORDER TO PROVIDE ECONOMIC RELIEF AND MARKETING SUPPORT TO MIAMI BEACH RESTAURANTS, AND FURTHER AUTHORIZING THE CITY MANAGER AND THE CITY CLERK TO EXECUTE THE FINAL AGREEMENT. RECOMMENDATION Adopt the Resolution. BACKGROUND/HISTORY On September 16, 2020, the Mayor and City Commission referred to the Neighborhood and Quality of Life Committee a discussion regarding the creation of a reimbursement program to Miami Beach restaurants for delivery services. At the September 23, 2020 Neighborhood and Quality of Life Committee meeting, the Committee discussed the hardships faced by restaurants due to the COVID-19 pandemic. Although restaurants were authorized to remain open throughout the shutdown, the primary restaurant model of in-person dining was restricted and remains limited even during the reopening phases. Due to physical distancing guidelines and the continued spread of the virus, restauranteurs and their patrons rely heavily on third party delivery services. The reduction of in-person dining and the increased dependency on third party delivery services exacerbates existing financial constraints, due to the associated commission fees from platforms such as Uber Eats, Postmates, DoorDash and GrubHub among others. Commissioner Gdngora discussed the potential to create a reimbursement program for Miami Beach restaurants to address the financial burden of delivery service commission fees. At the September 29, 2020 Budget Meeting, the Mayor and City Commission adopted Resolution No. 2020-31428, adopting the FY2021 General Fund budget, including an allocation of$60,000 for a reimbursement program to offset expenses incurred by Miami Beach restaurants for third Page 285 of 1252 party delivery services. On October 28, 2020, the City Commission subsequently approved Resolution No. 2020-31470, accepting the recommendation of the Neighborhood and Quality of Life Committee at its October 19 meeting and authorizing the creation of the Miami Beach Restaurant Reimbursement Grant Program, allowing for grants of up to $1,000 to reimburse eligible restaurants for third party delivery service commission fees. ANALYSIS The City has continued to explore methods for providing additional relief to Miami Beach restaurants and consumers. We are aware that Uber Eats successfully implemented partnerships with other municipalities, including the City of Orlando and the City of North Miami, which provided a basis for the types of incentives to explore. An important element to incorporate was a marketing campaign that will help drive additional consumer demand to local businesses in the City of Miami Beach. Following recent meetings with Uber Eats where Commissioner Gongora and City staff negotiated terms, a proposal was provided and is now submitted for consideration by the City Commission. The proposal, attached as Exhibit A, offers a few relief measures that benefit both Miami Beach residents and restaurants and includes: For Miami Beach residents: • Waiver of delivery fees paid by the customer for a period of 6 weeks • One free month of Uber Eats Pass, which offers free deliveries and 5% discount on all orders • New user marketing promotional code providing $10 off first time orders at Miami Beach restaurants For Miami Beach restaurants: • Removal of all marketplace fees paid by the restaurant when consumers pick-up orders at the restaurant, including credit card processing fees (through May 31, 2021) • Removal of all fees paid by the restaurants when using their own delivery person (through May 31, 2021) • Waiver of fees paid by restaurant when Uber Eats processes orders through a restaurant's website (through May 31, 2021) • Waiver of new restaurant activation fee and free use of equipment necessary to participate in Uber Eats (through May 31, 2021) In addition to the financial perks for restaurants and residents, the proposal includes a joint marketing effort between Uber Eats and the City, including issuing of a joint press release to raise awareness, targeted marketing by Uber Eats of its existing Miami Beach users, and Uber Eats will provide digital marketing assets to participating restaurants to help promote the campaign. The Neighborhood and Quality of Life Committee, at its January 28, 2021 meeting, considered the Uber Eats proposal and offered a favorable recommendation to move forward to negotiate an agreement between the City and Uber Eats. SUPPORTING SURVEY DATA According to the GMCVB, countywide data suggests that in-house restaurant dining is rebounding towards approximately 87% of historical activity after experiencing record lows last Page 286 of 1252 summer. Fortunately, South Florida remains one of the few "open for business" destinations where visitors continue to visit this winter. The recovery of our hospitality industry remains vital, as we know from the 2019 Resident Satisfaction Survey that 38% of respondents believe that tourism is positively correlated to restaurant industry growth. FINANCIAL INFORMATION The waiver of fees paid by customers and participating restaurants comes at no cost to the City. The participation of the City in marketing ofthe campaign will have nominal costs, if any. CONCLUSION The Administration supports the creation of a collaborative partnership between the City and Uber Eats, and recommends that the Mayor and City Commission authorize the City Manager and City Attorney to negotiate an agreement with Uber Eats based on the attached proposal. Applicable Area Citywide Is this a "Residents Right Does this item utilize G.O. to Know" item, pursuant to Bond Funds? City Code Section 2-14? No No Strategic Connection Prosperity - Market and promote Miami Beach as a world class arts, culture, and quality entertainment destination. Legislative Tracking Economic Development Sponsor Commissioner Michael Gongora ATTACHMENTS: Description o Attachment A- Uber Eats Proposal o Resolution Page 287 of 1252 Uber EXHIBIT A February 1, 2021 Commissioner Michael Gongora City of Miami Beach 1700 Convention Center Dr. Miami Beach, FL 33139 Commissioner Gongora, Thanks again for taking the time to meet with the Uber Eats team to discuss ways in which we can work together to help the Miami Beach restaurant community. We are deeply appreciative of the work by the City's Economic Development Department to explore a potential partnership between Uber Eats and the City of Miami Beach. Working jointly to implement a restaurant support program remains a desirable effort that we would like to implement in the coming weeks. Following additional discussions with City Staff and feedback discussed at the Neighborhoods Committee meeting, we've put together a program focused on increasing demand via delivery to Miami Beach restaurants. In a recent study, over 90 percent of restaurants that work with Uber Eats expressed support for the proactive initiatives Uber Eats has taken during the pandemic, including waiving consumer delivery fees. With that in mind, and in order to drive increased demand to local restaurants, the proposed campaign is outlined below: Miami Beach Residents: • Uber Eats will waive delivery fees from Miami Beach restaurants (Small businesses)for all participating eaters located in the City of Miami Beach to drive growth. This is a weekly projected delivery fee investment of over$20,000. The free delivery campaign will last 6 weeks, through 5/31/21, with dates to be determined by the City of Miami Beach. • Uber Eats will offer Miami Beach residents one free month of the Uber Eats Pass program, which includes unlimited free deliveries and 5% discounts on all orders. ($9.99/month cost) ,. • Uber Eats will institute a marketing campaign that includes a new user promo code of $10 off the first order when ordering from a Miami Beach restaurant. Miami Beach Restaurants: • Uber Eats will remove marketplace fee for all Pick-Up orders through 5/31/21. This includes credit card processing fees. • Uber Eats will remove fees to all SMB restaurants that use their own delivery person to fulfill orders on the Uber Eats platform. This is a projected delivery fee investment of over $1,000 and will last through 5/31/21. Page 288 of 1252 Uber Ec:i:s • Uber Eats will waive activation fees for new restaurant members joining Uber Eats and provide those restaurants with the necessary equipment free of charge through 5/31/21. • Uber Eats will waive restaurant fees associated with online ordering (Orders processed through a restaurant's website by Uber Eats) through 5/31/21. Joint Partnership Principles • Uber Eats will provide push notification and email communications to Uber Eats users about the campaign, encouraging them to order from Miami Beach restaurants. • Uber Eats will provide participating restaurants with digital marketing assets (i.e. digital toolkit) that can be shared via their own digital platforms to encourage eaters to take advantage of the various promotions. • The City Miami Beach will create, with input from Uber Eats, marketing assets using digital media and other promotional efforts to raise partnership awareness. • Miami Beach and Uber Eats will issue a joint press release to raise awareness and drive additional demand to local restaurants. Uber Eats supports efforts to help the Miami Beach hospitality industry, which is why we continue to focus our efforts on driving demand to independent local restaurants, which we know is a key concern of our partners during these times. The alternative proposal discussed on our call, legislatively regulating the commissions that fund our marketplace, would force us to radically alter the way we do business and ultimately hurt those that we're trying to help the most: customers, small businesses and delivery people. We look forward to working with you and the City of Miami Beach to support the Miami Beach restaurant community through this partnership. Guillermo Diquez Territory Lead, Uber Eats Support Miami Beach fir. 47, restaurantsPage 289,o ,12„ , vs. ~ ” _ Order Now-) _o._