Federal Government Says Hotel Resort Fees Are A-OK. They’re Not.

Resort fees are offensive. They are not optional charges, so they are part of the room rate. Not including them in the room rate is disingenuous.

Consumers and the government get up in arms and regulate over airfare displays when already those are pretty clear and clean, it’s hotels where the worst behavior happens.

They are one of my top hotel pet peeves.

The Andaz Maui started charging a $40 per night resort fee this spring. It doesn’t include parking.

While resort fees have generated lawsuits and the government has warned hotels about them, the Federal Trade Commission’s official position is that they are perfectly legal.

An FTC attorney said the agency isn’t insisting that hotels include the resort fees in the advertised room rate.

“At this time, we don’t have evidence to prove that not including the resort fee in the room rate is deceptive if a hotel prominently discloses the resort fee upfront and includes it in the total price” when a guest checks out, attorney Annette Soberats said.

That seems right as far as it goes, though it leaves resort fees as a dirty practice that has hotels disrespecting their guests.

It creates an interesting dichotomy — by virtue of:

  • Legislative history, granting significant oversight of airlines to the government as part of the process of ‘deregulation’
  • The different agencies overseeing airlines (DOT) versus virtually every other form of commerce (FTC)

…You get very different outcomes. The DOT literally considered in its proposed rulemaking last spring whether or not to require pop ups disclosing airline fees on booking sites, the problem of how one accomplishes that in a mobile environment notwithstanding. And hotels have wide latitude in how their prices are displayed, and certainly not being required to display resort fees until the final checkout page.

Even more offensive is how complicit hotel loyalty programs are in the practice. For instance, Hilton HHonors says hotels that bundle certain benefits into resort fees don’t have to provide them by virtue of status (otherwise members could argue against the resort fee, since they’re already supposed to receive what the hotel pretends that fee ‘pays for’).

These Amenities are offered solely at the discretion of Hilton HHonors Worldwide, L.L.C., and the individual hotel. Not all Amenities are provided by all hotels within the Hilton Worldwide portfolio. When payment of a resort charge is required, check individual hotel for availability of included Amenities.

Starwood says,

SPG Participating Hotels that have mandatory resort charges that include Internet access will provide a replacement benefit, to be determined at each SPG Participating Hotel’s discretion.

Thus it’s perfectly appropriate to levy complaints at the loyalty program for the practices they accommodate.

There are really two equilibria here:

  • No one charges resort fees, although there’s an incentive for a given hotel to defect if resort fees are permissible as it makes their rates look cheaper than the competition.
  • Everyone charges resort fees, to stay competitive with hotels that do and ensure they aren’t disadvantaged by the deception of other properties.

What I’d love to see is a major awareness and shaming campaign to change these incentives. Get lots of negative attention for hotels charging these fees.

They tend to cluster together in a region, where hotels are more or less all following the same practice in a given area. So picking out hotels will necessarily be unfair relative to less attention given their competitors. But it’s also precisely the uncertainty of massive negative attention that could give such a campaign outsized power.

Hotels need to respect their guests, and that starts with honesty about the most basic element of a reservation, the rate.

Towards that end, what are the most egregious resort fees you’ve seen?

(HT: Road Warrior Voices)

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. “At this time….not….deceptive if a hotel prominently discloses the resort fee upfront and includes it in the total price” when a guest checks out, attorney Annette Soberats said.”

    WHOA. So–what are the guidelines for a ‘prominent display’ and ‘upfront’? Incredibly ambiguous statement that leaves so much latitude for the hotels that it is basically giving the hotels carte blanche to (not) disclose the resort fee(s) in whatever way they want. No consumer protection whatsoever.

  2. Clearly they are fraudulent. If a hotel is 100 a night with a 20.00 resort fee they should be forced to quote 120.00 a night. Clear and simple. Front desk people take alot of heat for them. Years ago when these fees started in Vegas I think it was after 9/11. The resort fees were as much as 40% of the room fee on the strip. I asked what I got for that. A crummy newspaper, internet access and access to a crummy gym. Not the main (spa) gym at Mandalay Bay, but a basement room where they threw a few treadmills and ellipticals and called that the special gym. Vegas is the biggest ripoff of all. Some of those fees are near 40 a day now.

  3. @Kimmie. Clearly we both feel it is deceptive. It is hilarious when a room at a high end place 300-500 a night adds a 30.00 per night fee for nothing.

  4. Would the regulators view this differently if someone “won” a name your price Priceline deal only to have that amount increased to the extent of “resort fees”?

  5. FTC gets it wrong (again) – no shocker. Nobody at the federal government understands the travel business. Unlike most airline fees (Spirit and Ryan excluded), resort fees are not optional. Therefore they should be included in the hotel rate as quoted in all reservations systems.

  6. When I checked into Andaz Maui earlier this year, they told me parking was $35 because they didn’t charge a resort fee. When they added the resort fee, I sent them a tweet to ask about this and didn’t receive a response…not surprising I guess.

  7. Gary, I’m confused – your first sentence says “They are not optional charges, so they are part of the room rate.” But I thought the entire point of the issue is that they are not part of the room rate, but that they should be?

  8. @Andrew – how about ‘they’re in essence part of the room rate’ and ‘in any sane universe would be presented as part of the room rate’

    sorry to be confusing.

  9. You know who has the power to fix this: OTAs. Expedia, Orbitz, Kayak etc. could just change their searches to display resort fees and taxes. The reason they don’t is that they benefit as well by making people think that things are cheaper than they really are. A $100 room sounds better than a $132.16 room.

  10. Vegas is the biggest ripoff for resort fees. With some places now approaching $40 a night resort fees, I can’t understand why people are staying at the resorts that charge them.

    Most people have a smartphone that takes care of the free local calls, free long distance calls and the free internet. I’m not in Vegas to exercise or swim – I’m there to drink and gamble and perhaps attend some conferences in between… 🙂 These fees, in Vegas, are absolutely bullshit.

    I’d certainly be fine with them if I was allowed to opt-out and didn’t get the special wristband for pool access or whatever – or perhaps waive the fees for your top tier frequent guests.

  11. Ugh. This issue makes me so angry. If these fees are “mandatory” then they should be required to be included in the room rate. End of story. I don’t see how the government could see it differently. The only explanation is lobbying has had a major influence on this issue.

    I recently had an issue on a trip to Maui. The package was booked through Orbits (flight, hotel, rental car). While the resort fee was called out clearly the self-parking fee was not. Since i was renting a car, the parking fee was now “mandatory” as there was no other option for parking my car.

    I fought the hotel and won, but it was a shock to show up and hear that I would now have to pay an additional $16/day on top of the $30/day resport fee. My “deal” was now not so much of a deal.

    Had I known all of these “mandatory” fees up front, I may have made a different decision and THIS should be why they must be disclosed up front. I lose my power of choice when these fees are hidden in the fine print.

  12. I agree with the previous post by jfhscott. Getting the fee added to Priceline is the worst. They need to do something about it. I’ve gotten nailed 6 or 7 times.

  13. Boycott these liars with their phony “resort fees”. I have never paid one of these and never will. The most evil thing about it is that a property that actually wants to be honest with guests is at a serious disadvantage to the scoundrels.

  14. Earlier this year, I stayed at Treasure Island in Vegas. An emailed offer from them listed an optional resort fee. When I called to clarify ‘optional’, they explained that I would pay the fee (~$30) if I accessed the Internet (or used the pool or spa, which I don’t.) So I used my phone if I needed to find info, and used my iPad off site if I wanted to surf. And if I wanted the convenience in-room, I could choose to pay for it.

  15. @wackyjacky — How Priceline has gotten away with allowing resort fees to be added to “name your own price” bidding FOR YEARS continues to boggle my mind. Say you bid $65, win, and the hotel then adds a $30 “resort fee” that you didn’t know about. If that’s not deceptive, nothing is. Perhaps worse, it creates an incentive for competing hotels to all charge high resort fees. If one hotel can win the bid at $65 with a $30 resort fee, how is another hotel that would take $75 — but has no resort fee — supposed to compete? While the customer would prefer the $75 price, the hotel with the deceptive $30 resort fee “steals” the deal. Bizarre and outrageous.

  16. These fees are crazy-deceptive / dishonest…..I feel bad for the front desk staff who have to collect them. Ever notice how the look down and recite a scripted line or two just to break it to you? Their whole demeanor tells me they hate it too…

    The government had it wrong for all the reasons outlined above—but also, these fees are never disclosed in the room rate but are “called out” at some point hoping you won’t notice. They’re always in the T&Cs, buried in some part of the booking process or in a separate window. For example, Starwood confirmations don’t include the resort fee in the total price–even though they diligently include taxes (even local ones)….you have to manually add in the fee as disclosed in the paragraph above/below (depending on hotel) the room nightly/total calculations. So annoying. We’ve just stopped going to hotels with resort fees full stop. Just tell me the price and be done–nickel and diming me with this crap makes me question your whole hotel operation. If you’re willing to stick it to me on checkin with a resort fee, what other odd fees do I have to look forward to later? No thanks.

    (We once got charged $25 for getting a FedEx at a hotel with a resort fee—I asked why I was paying the fee in the midst of hearing how they wouldn’t even bring it to the room! “So what service is this package service fee for??”)

  17. Wyndham’s Ramada New Yorker (now Wyndham) in NYC (just north of the corner of W34th and 8th Ave in Manhattan) charges a “resort” fee. Rip-off at that.

  18. Most most most egregious – Ritz Carlton SJU charges a percentage of your room rate as a resort fee. Everyone gets the same “benefits” and everyone pays a different price.

  19. Ritz Carlton SJU charges a percentage of your room rate as a resort fee. Everyone gets the same “benefits” and everyone pays a different price.

    Is income tax another kind of resort fee?

  20. My entire family ( about 50 with cousins, kids, uncles, aunts) all agreed to NEVER stay in another hotel in Vegas that charges a resort fee.

    Most of us go to Vegas 3-4 times a year…..we figured were saving over 2,000 in resort fees as a family…..plus we find we don’t gamble AND LOSE as much

  21. It’s also perfectly legal for hotel customers to turn on all the facets and let the water run during their entire stay. Two can play at this game. If the hotels want to deceive customers, customers can create huge water bills for the hotels which will more than offset any resort fees the hotel collects. Very simple solution.

    p.s. this will also work in a tenant/landlord relationship if the landlord tries to rip off the tenant.

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