President Biden has declared war on ‘add-on’ fees, including hotel resort fees that he describes as ‘hidden hotel booking fees’. While we can all sympathize with the sentiment, his announcement is unlikely to do much to benefit hotel guests.
- Resort fees are fraudulent. The advertised price is not the price. A night at a hotel costs more than the amount you are shown when shopping (the room rate).
- Resort fees make it harder to comparison shop. They aren’t generally shown when shopping for a rate, each of the properties you might consider appears with a price that is less than the full price (and frequently not even by the same amount).
However there are multiple reasons that hotels engage in the shady practice.
- Resort fees may not be subject to discounting in a rate agreement.
- Resort fees aren’t always subject to taxation.
- Resort fees make a property look cheaper than competitor properties. If competitors have resort fees, a hotel needs to in order not to be advantaged. If competitors don’t, they want to in order to gain an advantage.
Here’s the thing. The position of the Federal Trade Commission has been that they are legal, as long as they are disclosed before a customer commits. That, apparently, has changed.
We’re cracking down on hidden "junk" fees like surprise overdraft and deposit fees, credit card late fees, hidden hotel booking fees.
Even those termination charges that stop you from switching cable and internet plans to get a better deal.
They add up. We're taking action.
— President Biden (@POTUS) October 26, 2022
It’s not clear though that the Biden administration can do much about resort fees, other than threaten (which could well be enough!). The FTC’s position that resort fees are not deceptive, and therefore are legal, was articulated at a time it was dominated by Obama administration appointees.
It seems better to first remove the government incentives that encourage resort fees in the first place (differential treatment of hotel room rate versus add-on fee taxes at the state and local level).
Online travel agencies could force an end to the practice, requiring resort fees and other add-ons to be provided in data feeds, and displaying only all-in pricing, excluding hotels that do not comply. These sites do not push for this, out of fear competitor sites wouldn’t (and those sites would have more hotel inventory, which also appears cheaper) and because consumers are an OTA product they sell to hotels not their actual customers.
Hotel chains could end resort fees too, by banning the practice for their franchisees and refusing to engage in the practice at their managed hotels. But they do not do this because for the chains, too, guests are the product not the customer (hotel owners are).
Actual laws need to change, or a sufficiently-compelling class action tort case needs to force change. We’re unlikely to see a real difference from an administration’s vibe shift or executive action that’s contrary to the historically prevailing view of the law.
They must be shaking in their boots LOL
Well, that’s good news. The Biden Regime is finally doing something productive. Too bad he has also declared war on America. Inflation through the roof. Interest rates going up. Gas prices way too high. And a depression starting to infect the economy. Hopefully, Biden’s puppet masters are looking for a nice old folk’s home so he can rot away.
What’s the difference between resort fees and raising the room rate? When you are looking at hotels and what they charge you do not see what the taxes are for that hotel in that city and or country. Why is the President even getting involved? Is it because he is not qualified to be President and run the government?
I think the reasons you’ve articulated necessitate some kind of federal action to resolve this issue. The car industry has for years been very restricted in how they present prices due to formerly deceptive practices, hotels should as well.
Every year hotels that have resort fees lose tens of thousands of dollars in revenue from me
Its the rare hotel each year I pay the fees when staying.In Honolulu I go to the Ritz Carlton in another city I go to Hyatt where they are waived as a Globalist or MGM properties in Las Vegas where they are also waived for elites
Unfortunately many are not in position to avoid them.
With Hilton I use points and never pay the fees either.
With IHG I only stay at properties that do not feature them etc.I will do anything to avoid them and I have succeeded 99% of the way.I suppose the topic is if they were to do away with them would the pricing rise.But even if so I am all for it!It would increase my business and allow for more choices.If a property has a resort fee it almost has no chance of me being a guest unless it is a category killer must have experience.
Nice to have an administration that tries to curb some corporate excesses but it’s going to take more than a single mention to get the hotels to stop scamming guests.
Finally after nearly 2 years in office, Joe Biden is here to help me at last!!
Now about those fuel prices what can you do?
More BS pandering by another incompetent administration. Neither Biden nor his inept handlers are going to do a single thing to change this repugnant practice of add-on fees to hotels or Airbnbs etc….
These clowns will say/do ANYTHING to appear to care all the while causing more destruction to everything they touch.
@ Alan — You mean the inflation created mostly by Donald Trump’s massive handouts?
Doesn’t quite have the appeal as student loan forgiveness.
He’ll be powerless in 13 days.
@Alan – Right on!! 100% agree!
@Gene.
1.) Every Democrat Senator and every Democrat Congressman sans 3 supported the BIll. Democrats had no problem with the excessive spending of the CARES act.
2.) Joe Biden also passed a massive handout– the American Rescue Act. Every Dem supported, no R’s.
So if you have a problem with the massive handouts– which I AGREE with you on– you have to assign more blame to Dem’s, bc they supported every single one. You can still assign partial blame to Trump and R’s– but the handout wouldn’t have been needed if politicians didn’t shut down businesses to begin with.
3.) A big reason for the massive inflation, is the increased cost of oil. Had Biden not revoked the permit for the Keystone XL pipeline— oil would be cheaper and inflation would be less. Farmers need fertilizer made with natural gas. That increases the farmers cost. Transportation costs from farm to store go up bc of gas prices. This causes price increases and inflation.
Only a fool would think 1 handout causes inflation, but another doesn’t. They all contribute– but the primary factor of inflation is the increased gas prices, which was 100% caused by Biden shutting down the Keystone Pipeline. And Biden doing his best to not allow permits for additional drilling which would increase the supply and lower costs.
I’m glad Gene– that you are now a fiscal conservative and are against excessive handouts and the governments inability to balance a budget. Welcome to the 5% of the population who preaches fiscal responsibility bc when the government is irresponsible, the primary people that are hurt bc of inflation are the poor and middle class.
Grats– you voted for Biden– you voted for the terrible policies which are now hurting hundreds of millions of Americans. Thanks for the inflation and higher gas prices by voting for Biden–aka Jimmy Carter 2.0.
Wow I was a hardcore MAGA TRUMP but now I recant
I love blacks now
Love Jews
Love Hispanic and Muslims
Love gays
Love abortion
Love socialism
Because most of all I HATE RESORT FEES!
First of all you know Joe didn’t write or post that. He could spell Twitter if you spotted him 6 letters let alone use it.
Secondly you would think he has a few more important matters to spend his time on than this.
Finally he will forget about it in a day or two since his memory is about shot.
In other words nothing will happen and someone in his office thought this might swing a few votes
The President calling attention to this nefarious practice – whether or not you like the President – is a good thing. These “fees” actually the rest of the room charge, are especially evil because, as is pointed out, they make would-be honest properties unable to compete without engaging in the practice too. If they’ll lie to you about their rate, why should you believe them about anything. I always end my interest in any property when I see one of those scam fees.
Gary
The metasearch system Kayak does offer a search option based on total cost, ncluding both resort fees and local taxes. It’s a great innovation.
Change its diaper and put it back to bed.
Amazing how people think Biden controls the gas prices charged by other countries, the corporate ripoffs and the supply chain issues. Not that he caused all of this either, but I guess it’s easier to blame a man who is trying to undo the damage of the last administration then consider what a babbling hate filled liar did to destabilize the world.
But did he say that resort fees are systemically racist because they disproportionally affect black and brown people? Otherwise, it doesn’t count and won’t draw last-minute votes.
Dave Flaat,
Biden ate humble pie and went to Saudi Arabia to try to get lower gas prices, and the scummy Saudi royals got their way, played him like a fiddle and went in for jacking up oil prices before the midterms anyway.
I knew the Saudis would not act honorably, as the Arab royals and their hanger-ons collectively hate the Democrats and love the Republicans — going back to at least the Carter Admin years — and play from the same dirty playboy time and time again. Biden should have been wise to this, but he thinks he can be chummy and make things work out anyway. Foolish on his part perhaps, but I give him credit for his willingness to risk coming across as the played fool since the Saudis and their oil-selling-dependent allies never play nice with Democrats. The Saudis prefer Republicans.
By the way, inflation is not as bad in the US as it is outside of the US. The strong US Dollar under the Biden Administration has helped Americans be less hit by inflation than is the case even in most of the high income countries around the world. And the low and middle income countries are also doing worse with inflation than the US. Of course this doesn’t take the sting out of inflation, but the high inflation scene in the US has very little to do with Biden Administration policies.
@GUWonder – that’s not super persuasive, first “outside the U.S.” you’re really just talking about Europe. That difference goes away if you normalize for the impact of Russian gas. And saying “Europe overspent and printed too much money, too” isn’t an excuse. Canada’s inflation is lower than in the U.S. So is Australia’s and New Zealand’s and Japan’s and South Korea’s.
Inflation in the U.S. would have been lower if not for big stimulus at the end of the Trump administration and the start of the Biden administration. And energy costs would be more manageable if the administration hadn’t clamped down on domestic oil production nearly two years ago.
Ultimately inflation is a function of too much money chasing too few goods, and that’s the fault of both too much money (Fed policy and unprecedented deficit spending) and too few goods (constrained by regulation and other policies). Since spending has continued, that forces the Fed to tighten further.
Saying “the high inflation scene in the US has very little to do with Biden Administration policies” is disingenuous. Trump policies were bad, too, to be sure! But Biden policies have contributed as well. It’s fair to say “if only the Trump administration hadn’t spent so much on Covid relief early in the pandemic, we wouldn’t be at a margin where Biden spending matters so much” but I do not take that to be what you’re saying.
Says a lot about a person who supports a stupid, lazy, nasty, pathologic lying, corrupt, racist, serial sexual assaulter, serial wife cheating, amoral, military service dodging, multiple bankruptcies, tax cheating, con-man like Trump who created the largest deficits in history and added massively to the national debt. Either childlike naivete, complete stupidity or absolute bigotry. There’s worldwide inflation, recession/depression, rising interest rates and gas prices and depression, it’s not Biden’s doing, America is suffering just like all other countries. Typical economic depression at the end of a Republican administration which created massive deficits; Reagan did it, Bush did it, Trump did it. I’ll take a little bit of senility (Biden) over a sociopath (Trump) any day of the week. Oh yeah, he didn’t even know Jeffrey Epstein. Trump said it himself, Feb 23, 2016 after Nevada caucuses “I love the poorly educated.” Without lies, hypocrisy, voter supression and many many stupid voters, the GOPs would NEVER win an election.
Biden can’t find his ass with both hands
He at least does try
Has anyone ever agreed or all liked a single president in the US ever?
Who was perfect.I can only think of one that scared me though and its gone hopefully forever.
The world is a very fragile place today
Why doesn’t Pete Buttigieg handle the hotel resort fee or is that someone else job
Seems to me there are ton of things on JBs plate
Good to see do-nothing-Washington do something that isn’t just doling out millions to airlines with zero in return (actually, just horrendous chaos).
Good luck to Biden in actually getting it done; citizens will be grateful for it.
Nice to see Washington preaching capitalism instead of cronyism.
Economics 101 teaches that competition (a.k.a. a free market) depends on transparency, and is not achieved when trickery, hiding, and obfuscation is in place.
I would fix fees in a heartbeat
@Objective Observer, you overlooked the simple fact that, sadly, many people are more concerned with lower tax rates than just about anything, including the character of an individual. It isn’t explicitly naivety or stupid, but selfishness and greed.
@Gene and @Gary, It appears rather disingenuous to claim that clamping down US oil production has drastically impacted a rise in oil prices. Keystone was never projected to exceed 1MM barrels per day, Whereas the world produces 80-100MM barrels per day. 1-2% of world production! Please note that releasing upwards to 1MM barrels per day from our strategic oil reserve hasn’t done a lot to bring down gas prices. So it seems illogical to say Keystone would have resulted in low gas prices in perpetuity!
The end of the Keystone pipeline decimated Calgary’s economy. That is a truthful statement of an immediate impact the US administration had on an economy.
No one expected the world to shut down, people to stop working for pennies to the dollar, or for Russia to invade Ukraine (what is it, Ukraine produces 25% of world’s wheat). All of which have have resulted in meaningful impact on inflation.
Yes, there are many facets to this spike in inflation, and for people trying to support a family the impact of inflation is magnified. I feel sorry for those families.
Gary, update this news one year from now. See if anything has changed.
In my opinion, nothing will happen or change. It is just hot air.
And how many of those very same Republicans who voted against Biden’s spending bills then go to their district or state and brag about the funds coming in?
Instead of the breathless hysterical horse-race reporting about every election, it would be nice if the media focused more on actual historical DATA showing how the economy (jobs, growth, the markets etc) did under D & R presidents. Since WWII, there is a clear winner…
Glad to see he’s finally getting things done
These disgusting anti-Biden posts need to stop. This is a travel blog not intended to be a right-wing nut job posting board.
An administration doing something to help people, not corporations. Good job!
So funny to hear people complain about free-market gas prices. They want government to do something about it, but government controlled oil companies?? Ok I’m in. But the people complaining about gas prices always preach free enterprise. Well…this is it! Greed of oil companies keeps prices high which keeps everything high. Positively zero reason prices need to be as high as they are – except for the greed of oil companies. Capitalism! Free market enterprise. This is it. Don’t want government controlled everything? Then shut the hell up!
@GREGGL – first of all I agree there shouldn’t be political comments (and frankly Gary posting this trolled for them since nothing will come of Biden’s comments) but you must not have read the anti Trump and anti GOP comments. Trust me they are as vicious as anything posted about Biden. I guess the “party of tolerance” justifies demonizing Republicans but gets thin skin when one of their own.
Bottom line – we are have well established positions and nothing. Posted on here will change them so I would like to see ALL PARTIES stop w the political messages starting with Olaf, GU Wonder and Observer (who are likely the same person given their almost identical messaging)
The Democrats are mostly idiots and the Republicans are mostly whores to Wall Street and crony capitalists. Fine shape for a country to be in.
If Biden makes resort fees illegal then he will get my vote in 2024.
But I think that is about as likely as inflation going back to 2% annually.