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Coloradans will pay 27 cent fee on most deliveries, effective July 1

Coloradans will pay 27 cent fee on most deliveries, effective July 1
Posted at 6:00 PM, Jul 05, 2022
and last updated 2022-07-05 21:16:24-04

COLORADO SPRINGS — If your dinner plans include delivering food tonight, you'll notice an extra fee on your order. It's called the Colorado Retail Delivery Fee, and it’s part of a new law that went into effect at the start of the month when the fiscal year began.

The fee is 27 cents and it goes on all retail deliveries, including orders on sites like Amazon or orders through third-party delivery services like DoorDash, Grubhub and Uber Eats.

Therefore, as a customer, you’ll now see the fee at the bottom of your receipt or bill when you receive a delivery. The Colorado Department of Revenue is enforcing it, but it’s being implemented by business owners. Business owners collect the fee and submit it back to the state.

Local business owners said this could impact business and their decision on deliveries moving forward.

“It is one of them things that might dissuade us from continuing to do delivery,” said Tyler Sherman, the owner of Odyssey Gastropub in Downtown Colorado Springs.

The Gastropub is also a business that uses the third-party company, DoorDash, for delivery, and they are now required to implement the 27-cent fee.

“We definitely don't care for it as business owners. It reflects negatively on us and I think it affects small business in a much greater way than it affects big business,” said Sherman. “If we didn't have to do it, we wouldn't do it. It's not something that we're looking forward to.”

The fee requires that retailers, online market places and services charge the fee if the order is delivered using a motor vehicle and that it includes one item that's subject to sales tax.

Meanwhile, Felipe Velasquez is the owner of Felipe's 109 located off of S. Academy. He says because of the new fee, it's another reason why he doesn’t want to have delivery drivers or use third-party delivery services for his business.

“Those are sales that we could be charging with customers to grow as a small business, and unfortunately we're not going to be able to do that because they're (delivery services) are going to add another fee for us,” said Velasquez.

Velasquez says the retail delivery fee would simply be another fee on top of the 5% inflation fee he's also implemented to help balance costs. He believes the retail delivery fee would hurt the bottom line of the business even more, which is why he’s choosing not to deliver from his business.

“We believe our prices are fair and if we raise them significantly high, people aren't going to want to come to us as much as a big chain,” said Velasquez. “Unfortunately we’ve stopped using third-party delivery so if you want Felipe’s 109, you have to come in person.”

The fee is part of a transportation funding bill approved by lawmakers in 2021. Money collected from this fee will go toward state and local road projects, pollution reduction projects, and electric vehicle programs.

The 27-cent fee is expected to increase with inflation.

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