Meeting Mentor Magazine

May 2024

Are Hotel “Junk Fees” on the Way Out?

hidden feesFinally, something both sides of the aisle can agree upon — that those ever-proliferating hotel resort fees and other add-on surcharges need to be brought into the light.

It’s rare these days for Republicans and Democrats to agree on anything, but in an exception that proves the rule, the Senate recently introduced a bipartisan bill designed to drag add-on hotel fees and surcharges into the light of day. Called the Hotel Fees Transparency Act, the bill introduced by Sen. Amy Klobuchar, D-Minn., and Jerry Moran, R-Kan., would make disclosing those fees up front — something that has been voluntary until now — mandatory. It also empowers the Federal Trade Commission to seek violators, and state attorneys general to bring civil action against hotels that don’t clearly show the final price to customers prior to booking a room. In addition to hotels, the proposed legislation also includes online travel websites, major search engines and any other site that advertises lodging.

“Too often, Americans making reservations online are being met with hidden fees that make it difficult to compare prices and understand the true cost of an overnight stay,” Sen. Klobuchar said. “This bipartisan legislation would help improve transparency so that travelers can make informed decisions.”

The new legislation isn’t the first time in recent memory so-called “junk fees” have been in the crosshairs. Back in February, President Joe Biden put a target on those fees during his State of the Union address, though he included banks, airlines, concert ticket providers, TV/phone/internet service providers, and other businesses along with hotels. These fees include pretty much any fees or surcharges that aren’t included in the initial prices that consumers often don’t even realize exist until they see it on their final bill. “We’ll ban surprise ‘resort fees’ that hotels tack on to your bill,” Biden said. “These fees can cost you up to $90 a night at hotels that aren’t even resorts.”

Travel consumer advocate Christopher Elliott is firmly on board with the idea. In a recent column, he says that not only are hotels not voluntarily becoming more transparent in disclosing these fees up front, but they are actually doubling down, with mandatory daily resort fees actually increasing 3% over last year, according to “Hotels have returned fire in the junk fee war by adding surprising new extras,” Elliott wrote.

You may not find a “resort fee” on the bill, but it could be lurking under another name, such as destination fee, administrative fee, cleaning fee, service fee or utility fee. You may see fees for things that used to be included in the overall room rate, such as fees for using towels or the internet, Elliott warned. He also tells the tale of a meeting planner who booked a Washington, D.C., hotel only to find a surprise $20 “Daily Mandatory Destination Charge” on his bill that covered some amenities, like bike rental and internet. However, it was called a “mandatory tax” on the bill. Elliott quotes the planner as fighting back, saying, “I pointed out there is no mandatory destination tax and that they can very much drop this ridiculous fee.”

According to Consumer Reports, resort fees alone rang the hotel industry register to the tune of $2.9 billion in 2018. Some hotels are in fact becoming more transparent, though it may be a push to call it “voluntary.” For example, as part of a settlement in a 2019 lawsuit, Marriott began including resort fees in the total prices reflected on the first page of its booking website.

Not Everyone Agrees These Fees Need Fixing

However, says the American Hotel and Lodging Association, consumers really don’t mind paying extra fees. In a recent poll AHLA commissioned, 80% said resort fees were OK with them, as long as “the amenities are worthwhile,” and 83% of recent hotel guests said they were satisfied with the transparency of their room charges and other fees. However, 68% balked at paying mandatory short-term rental cleaning fees, which more than half said were “excessive.”

“AHLA’s most recent data shows only 6% of hotels nationwide charge a mandatory resort/destination/amenity fee, at an average of $26 per night,” AHLA President and CEO Chip Rogers said in a statement. “These fees directly support hotel operations — including wages and benefits for hotel staff — and when they are applied, hotel websites clearly and prominently display them for guests during the booking process, in accordance with FTC guidance.”

The American Gaming Association agrees that this is a non-problem. In a recent filing to the FTC, the association said, “Changing to all-inclusive pricing would result in removal of existing amenity disclosures and could lead to consumers making assumptions about what services and amenities would be available.” And it adds that its members already are voluntarily disclosing the fees before checkout.

Will this new bipartisan bill gain any traction? After all, a similar bill, the Hotel Advertising Transparency Act of 2022, was introduced in the House last summer and doesn’t appear to have made any progress since. Stay tuned…


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