March 4, 2024

BASS

Booking Travel

Resort fees, deposits and taxes: Hotel charges are a confusing mess

Earlier this month, Lynette Eastman, general manager of the Surfjack Hotel and Swim Club in Honolulu, delivered some shocking news to a guest. It concerned her bill.

The vacationer had called the Waikiki property requesting the total amount of an upcoming stay. She specifically asked about a resort fee, the sneaky charge that hotels often slip in at the last minute of the booking process and bury among the other taxes and fees. Eastman told her the Surfjack did not have a resort fee, though that was not always the case: The hotel had suspended the $26.18 fee in spring 2020 but never restored it, even after nearby properties reinstated theirs.

“That was great because I got to experience her surprise,” Eastman said of the guest’s happy reaction. “Do I think a lot of hotels are going to start waiving fees? Possibly, if the business is in a location that doesn’t pick up, like in Hawaii. But my guess is that the fees will continue to be charged.”

5 ways to be a good visitor on Maui as tourism reopens

According to the American Hotel and Lodging Association, roughly 6 percent of U.S. properties exact a mandatory fee that hotels claim covers a grab bag of perks, such as WiFi, bike rental, fitness center or a food and beverage “credit.” Yet, the fee seems inescapable in many vacation destinations and is just one more financial burden placed on guests at check in.

Hotels pile on so many charges, you might feel like you need an accountant to decipher your bill. In addition to the room rate, there may be a bundle of city, state and local taxes, plus a resort fee, which goes by many names and is also taxed. During check-in, the front desk employee will place a hold on your credit card for incidentals. The amount can range from a couple Jacksons to hundreds of dollars per night. Guests with credit cards won’t feel the pinch, but people who use debit cards cannot access that amount during their stay and may need to be careful with their expenditures.

As long as you don’t trash your room or drain the minibar without paying, you will get the money back. This is not the case with resort fees. Even if you don’t use the WiFi, bike, fitness center or credit, you’re still stuck with the fee.

“We can perceive both of these as friction points and annoyances for the hotel guest,” said Mehmet Erdem, a professor of hospitality at the University of Nevada at Las Vegas, “though technically they’re separate accounting-wise and procedural.”

Like a shifty character in a true-crime novel, the fee often hides in the shadows and goes by several aliases, such as resort, amenity, facility or destination. Some hotels also tack on a “room safe fee,” though the charge for having a safety box in your room is significantly less (a couple dollars a day) than the amenity fee (according to an analysis commissioned by AHLA, an average $26 per night).

Chekitan Dev, a professor at Cornell University’s Nolan School of Hotel Administration, dates the current incarnation to 1997. Nearly two decades later, Lauren Wolfe founded Kill Resort Fees after a Key West hotel refused to hand over her room key until she forked over an extra $20.

“Over a decade ago, we started to see resort fees in places like Hawaii, and then they started to creep into places like Las Vegas.” Wolfe said. “Then it spread like wildfire.”

Resort fees are in the hot seat. Here are 10 of the weirdest.

This summer, Wolfe turned up the heat as chief legal officer for Travelers United, a consumer advocacy group. In August, the nonprofit organization sued Hyatt and Sonesta Hotels, alleging false advertising and deceptive fees. The following month, it filed a class-action lawsuit against Hilton.

These hotels are not paying attention to any sort of law in their state, whether it be basic advertising laws that protect consumers from unfair, deceptive practices or alcohol laws that forbid people from essentially being forced to buy alcohol,” said Wolfe, referring to properties that include a cocktail in their resort fee.

Since 2019, state attorneys general in a handful of states and D.C. have been suing some of the world’s biggest hotel chains for allegedly violating consumer protection laws. Some of the cases are still ongoing, such as Nebraska and Hilton and D.C. and Marriott. Others have been settled, such as the lawsuit that pitted attorneys general in Colorado, Oregon, Pennsylvania and Texas against Choice Hotels. As part of the September deal, the chain agreed to disclose all mandatory fees on the first page of its booking website and include them in the total price.

Chip and Joanna are still fixin’ up Waco. This time, it’s a hotel.

This year, state and federal legislators also started tackling junk fees. In July, two U.S. senators introduced the bipartisan Hotel Fees Transparency Act. In October, California passed a pair of similar bills, including a law that will ban the hotel industry’s deceptive practice of drip pricing, in which companies list a partial price and does not reveal additional charges until later in the purchasing process. It goes into effect next July.

Last year, the Biden administration called out these fees and rallied government agencies, Congress and the private sector to curtail the unfair practice. In October, the president revisited the issue, introducing a proposed Federal Trade Commission law that will require businesses, including hotels, to be upfront with their prices. The agency is accepting public comments through Jan. 8. Since Nov. 9, more than 20,200 people have submitted complaints.

“I think if the pressure from the government and the regulations and the state attorney general offices and the lawsuits creates enough of a headache, then the industry will do something collectively about it,” Erdem said.

What hotels aren’t talking about

The American Hotel and Lodging Association as well as individual hotels, such as Hilton, have expressed their support for legislation that requires transparency in pricing. However, the conversation about resort fees seems be ignoring some glaring issues.

For one, the hotels are forcing guests to pay for services or perks that they might not want or need. (When was the last time you made a long-distance phone call on a hotel room phone?) On their websites, most properties bury the list of amenities associated with the fee, so consumers have to pick through the small print. Even when they find it, the descriptions can be indecipherable. Finally, a mystery surrounds the number itself.

In a sampling of hotels in Washington, the amenity fee with tax ran the gamut, from zero (Citizen M, the Jefferson, Conrad Washington) to $23.19 (Washington Hilton), $28.99 (Marriott Marquis) and about $35 (the George, Yotel). The incidentals and security deposit was equally vast, ranging from $50 at the Days Inn to $200 at Hotel Washington.

Travelers might discover higher charges in swankier destinations or at luxurious properties with fancy decor. At the Aria, on the Las Vegas Strip, the resort fee is $51 and the incidental hold runs from $150 for a standard room to $500 for a villa. Grand Beach Hotel Surfside in Florida hits guests with a $64.38 resort fee; the credit card hold is kinder, at $100 a night.

The hotels contacted for comment declined to explain the calculations. One can only guess the financial outlay for, say, printing assistance at the front desk, a downloadable self-guided walking tour or a pool chair.

Why are hotel showers so ridiculously complicated?

“It’s a blackbox, let’s-see-what-sticks approach,” said Dev, adding that hotels typically consider supply, demand and competition when formulating the fee.

During a trip to New York City, the professor could not fathom why the Even Hotel in Midtown East charged $25 (plus tax) for what he called “overpriced and useless amenities.” He and his wife passed on the Citi Bike passes (“I’d have to have a death wish”), local and long-distance calls (“This is a joke”), access to Peloton classes (“We were not visiting New York City to take a stationary bike lesson), package handling (“Huh?”) and laundry (“With the average stay being one to two nights, my garment might not make it back.”).

They did, however, take advantage of the free welcome drink: two bottles of water valued at $2.

To avoid fees, ask nicely then contact an attorney general

It’s not hopeless. You can dodge resort fees.

First, use your purchasing power. A NerdWallet analysis singled out the hotels with the highest average fees relative to room rate. Wyndham ranked first, with fees costing $30 and $50 per night, followed by Hyatt, IHG, Hilton and Marriott. Best Western, which is not really known as a playground of perks, came in last, with the lowest fee.

Lost your ID, phone or credit card? Here’s how to travel without them.

You can also shop around for fee-free hotels. Kill Resort Fee’s lists hotels with fees in 15 destinations, so avoid those. (Look under “Offenders.”) In our D.C. sample, more than half did not charge a resort fee. On Surfjack’s website, the hotel promotes its lack of fees. A pop-up box exclaims, “Wipe out fees!”

“We are definitely seeing a trend of hotels distinguishing themselves by not offering them at all,” said Sally French, lead writer with NerdWallet.

If you are a loyalty hotel member, you can avoid the fees by booking with points, depending on the program’s policy. Also, the higher up you go on the status pole, the fewer extraneous fees you will have to pay. Some travel credit cards will also reimburse resort fees.

In your kindest voice, you can also ask the front desk to remove the fee, especially if an amenity or service is not available during your stay.

“If you’re checking in at 11 p.m. and checking out at 7 the next morning and you’re just using the hotel as a place to sleep, maybe that hypothetical trolley ride doesn’t even run during that period,” said French, referring to a perk at the Marriott Marquis. “It doesn’t hurt to tell the desk there was no way you could have taken that trolley ride and ask them to waive the resort fee.”

Hidden ‘junk’ fees are infuriating. Tell the FTC your story.

Wolfe does not recommend pushing the issue. After two times, she says to quit. The next step is to send your complaint to the attorney general who serves your home state or the hotel’s. You can only pick one, so choose the location with the strongest consumer protection laws.

“In Washington, D.C., it works great,” she said, “but it does not work in states where the attorneys general are not taking this issue seriously. A good example would be Nevada. We have not yet heard of one person having success with them.”

correction

An earlier version of this article incorrectly stated that Even Hotel was in Times Square. It was in Midtown East. The article has been corrected.

link