Are hidden hotel fees about to check out?

After Jane Hatch selected the room rate she wanted at the West Street Hotel in Bar Harbor, Maine, the hotel Web site delivered an unpleasant surprise on the next screen: The quoted price hadn’t included a $25-per-day “resort and club fee” that gave Hatch access to the hotel pool, hot tub and fitness center — whether she wanted it or not.

“They didn’t tell me until the end,” says Hatch, who lives in Montgomery Village, Md. “I still booked the room, but it was misleading and unbecoming, particularly for a new property looking to make its mark. Perhaps they don’t care in resort areas like Bar Harbor. But I care.”

So does the Federal Trade Commission. In a surprise move, the consumer protection agency recently warned 22 hotel operators that their online reservation sites may violate the law by displaying a “deceptively low” estimate of what consumers can expect to pay.

In May, the FTC hosted a conference on “drip pricing,” in which companies advertise only part of a product’s price and reveal other charges later as you go through the buying process. The FTC has received many consumer complaints about hotel resort fees, and this fall, several consumer advocates wrote a letter to the agency, asking it to crack down on them.

“This is good news for consumers,” says Bjorn Hanson, dean of New York University’s Center for Hospitality, Tourism and Sports Management. “It will eliminate some of the disappointment and frustration they have when they haven’t been aware that there will be resort fees. I think it also will be good for so many hotel employees, who will now not have guests be surprised, as they seem to be so frequently.”

A representative of the West Street Hotel defends the property’s mandatory fee, calling it a “terrific value.”

“The feedback from guests over the summer, which was the first season for the new hotel, was largely in favor and agreement about the value of the fee,” adds Jennifer Cuomo, a spokeswoman for the property. She says that Hatch was shown an all-inclusive rate online before booking, in accordance with the FTC guidelines.

The West Street’s Web site shows the full charge after a basic room rate has been selected.

The FTC action stops short of what the Transportation Department did this year for airfares, requiring airlines and online agencies to display an “all-in” fare that includes every mandatory charge up front. Consumer advocates remain hopeful that the warning could translate into enforcement actions entitling shoppers to see the full price initially, when they ask for a price quote, and not at the end of the booking process, when many have already decided to reserve the room.

Ed Perkins, one of the leading voices against resort fees (and, by way of full disclosure, a columnist for Tribune Media Services, which syndicates one of my columns), calls the FTC’s warning a “partial victory.”

“Apparently, at least some hotels are being careful to note the fees immediately, and they’re also noting the fees in what they post to online travel agencies such as Expedia,” he says. “As far as I can tell, they’re complying with what the FTC asked.”

But as of late last week, it remained unclear whether any hotels that had received the warning had taken action to comply with it. The FTC wouldn’t say which ones had been cautioned. I asked most of the major hotel chains whether they’d seen the letter, and I received a variety of responses.

Hilton referred all questions to the American Hotel & Lodging Association, the trade association for the U.S. hotel industry. Joe McInerney, the association’s president, says that “misunderstandings” aren’t necessarily caused by resort fees but often by online travel agencies that display a rate that doesn’t include the fees. He says that his association doesn’t set standards on the acceptability of charging a resort fee.

The FTC warning has been referred to the group’s attorneys, McInerney says. “We’ll probably send out an advisory to our members soon.”

Other hotel companies either didn’t respond to my questions or said that they hadn’t received the FTC letter. Of the major American hotel chains that I contacted, only Marriott, which owns the Courtyard, Renaissance and Ritz-Carlton brands, said that it had been warned. But a company spokesman says that Marriott is already following the law. “We do disclose fees before the booking is completed,” says John Wolf, a Marriott spokesman. “We believe we are in compliance.”

Gary Cohen begs to differ. He says that he was surprised when Ritz-Carlton tacked a $25 resort fee to a recent $600-a-night rate. The amenities should have been included in the room price, he says, not separated as a mandatory fee. “Do you really need to nickel-and-dime your guests another $25?” asks Cohen, the president of a health food company in Sacramento. “I guess in the case of the Ritz, the answer is yes.”

What’s going on here? Hotels want to quote a low base rate to entice guests to book their rooms, while travelers just want to know the total cost from the start.

For now, it appears that the FTC will allow hotels and online agencies to continue displaying an artificially low price, as long as they reveal the full rate at some point before a purchase is made. But the FTC is just getting started, and the government can tighten its requirements or force the industry to change the way it displays prices through a series of enforcement actions or lawsuits as it tries to address the problem of drip pricing.

In the meantime, customers who find a mysterious resort fee at the end of a booking path can do what Cohen and Hatch did: complain. Cohen says that Ritz-Carlton never responded to his grievance, but Hatch’s resort fee in Bar Harbor was stricken from her bill.

Maybe the FTC’s actions haven’t killed mandatory resort fees. In fact, no matter where or how the fees are disclosed, NYU’s Hanson says, they’ll continue to exist because they allow a hotel to avoid paying certain taxes on them. But “gotcha” resort fees as we know them in the United States may be mortally wounded.

Are resort fees dead?

View Results

Loading ... Loading ...

Underwritten by

Elliott Advocacy is underwritten by Cavalry Travel Insurance

Cavalry takes the worry of out travel by providing 24/7 access to medical and security professionals combined with the best medical evacuation and security extraction services. Cavalry gets you home safely when you need it most. Learn more at Cavalrytravelinsurance.com.

Elliott Advocacy is underwritten by Seven Corners

Seven Corners has helped customers all over the world with travel difficulties, big and small. As one of the few remaining privately owned travel insurance companies, Seven Corners provides insurance plans and 24/7 travel assistance services to more than a million people each year. Because we’re privately held, we can focus on the customer without the constraints that larger companies have. Visit Seven Corners to learn more.

Elliott Advocacy is underwritten by Sodexo North America

Sodexo North America Sodexo North America is part of a global, Fortune 500 company with a presence in 80 countries. Sodexo is a leading provider of integrated food, facilities management and other services that enhance organizational performance, contribute to local communities and improve quality of life for millions of customers in corporate, education, healthcare, senior living, sports and leisure, government and other environments daily. Learn more at Sodexoinsights.com.

Elliott Advocacy is underwritten by Travelex Insurance Services

Travelex Insurance Services is a leading travel insurance provider in the United States with over 55 years combined industry expertise of helping people dream, explore and travel with confidence. We offer comprehensive travel insurance plans with optional upgrades allowing travelers to customize the plans to fit their needs. Compare plans, get a quote and buy online at Travelexinsurance.com.

Elliott Advocacy is underwritten by AirHelp

AirHelp is the world’s leading flight delays compensation company, helping passengers apply for compensation following a delayed or canceled flight or when boarding has been denied. It is AirHelp’s mission to fight for passenger rights by holding airlines accountable for flights disruptions that are out of passengers’ control. AirHelp has already helped 5 million people, taking the stress out of applying for compensation and making it as hassle-free as possible for travelers around the world.

Elliott Advocacy is underwritten by Allianz Travel Insurance

The Allianz Travel Insurance company has built its reputation on partnering with agents all around the world to provide comprehensive travel insurance for their clients. Contact Allianz Travel Insurance for a comprehensive list of coverage.

Elliott Advocacy is underwritten by Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company, and recognized as the premier provider of insurance for successful individuals and families in the U.S. and selected international markets, offering coverage for high-value automobile, homeowners, recreational marine/aviation, valuables and umbrella liability coverage. As an underwriting company, Chubb assesses, assumes and manages risk with insight and discipline, and combines the precision of craftsmanship with decades of experience to conceive, craft and deliver the best insurance coverage and services to individuals, families and business of all size.

Elliott Advocacy is underwritten by Fareportal

Fareportal’s portfolio of brands, which include  CheapOair and  OneTravel, are dedicated to helping customers enjoy their trip. Whether you want to call, click, or use one of our travel apps, one thing is clear: We make it easy to take it easy.

Elliott Advocacy is underwritten by Insuremyrentalcar.com

An independent provider of low cost CDW/LDW insurance for use with rental cars. Up to $100,000 cover with no deductible. Policies available on a per day, per trip or per year basis. Also works with overseas rentals. Try  Insuremyrentalcar.comnow.

Elliott Advocacy is underwritten by Mediacom Communications

The nation’s fifth-largest cable operator, serving the smaller cities and towns in the Midwest and Southern regions of the United States. We are a high-performance broadband, entertainment, and communications company that brings the power of modern technology and quality customer experience to life inside the connected home by combining ultra-fast gigabit speeds with personalized local and over-the-top entertainment choices that fit your lifestyle. Details at  Mediacomcable.com.

Elliott Advocacy is underwritten by Arch RoamRight

Arch RoamRight is one of the fastest growing, most-highly rated travel insurance companies in the United States. Travel advisors love working with us, and travelers feel protected with our trip cancellation and travel medical insurance coverage. We also make it easy to file a claim online with our fast, paperless claims website. Learn more about RoamRight travel insurance.

Elliott Advocacy is underwritten by Virtuoso

The leading global network for luxury and experiential travel. This invitation-only organization comprises over 1,000 travel agency locations with 17,500 advisors in over 45 countries, and holds preferred relationships with 1,700 of the world’s finest travel companies. Virtuoso advisors collaborate with their clients to create personalized itineraries featuring exclusive perks, while also providing advice, access, advocacy, and accountability. For more information, visit  Virtuoso.com.

Elliott Advocacy is underwritten by VisitorsCoverage

As a company that is constantly striving to simplify travel insurance, VisitorsCoverage, is on a mission to help travelers make the better decisions about purchasing travel insurance, quickly. VisitorsCoverage has helped millions of travelers globally to buy the suitable travel insurance and explore the world with confidence. Get insurance for your next trip at  VisitorsCoverage. Lowest Price Guaranteed.

Elliott Advocacy is underwritten by MedjetAssist

Medjet is the premier global air-medical transport, travel security and crisis response membership program for travelers. With a MedjetAssist membership, if you become hospitalized more than 150 miles from home, we will get you from that unfamiliar hospital all the way home to the hospital you trust. All you ever pay is your membership fee. MedjetHorizon members add 24/7 personal security and crisis response benefits. Elliott.org readers enjoy discounted rates. Travel safer with  MedjetAssist.

Elliott Advocacy is underwritten by Southwest Airlines

The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.

Elliott Advocacy is underwritten by TravelInsurance.com

TravelInsurance.com makes it fast and easy to compare and buy travel insurance online from top rated providers. Our unbiased comparison engine allows travelers to read reviews, compare pricing and benefits and buy the right policy with a price guarantee, every time. Compare and buy travel insurance now at  TravelInsurance.com.

Elliott Advocacy is underwritten by Squaremouth

Squaremouth helps travelers easily and instantly compare travel insurance policies from all major providers. Only companies that meet the strict requirements of Squaremouth’s Zero Complaint Guarantee are available on the website. Compare policies on  Squaremouth.com to save over 70 percent on your next purchase.

Elliott Advocacy is underwritten by Travel Leaders Group

Travel Leaders Group is transforming travel through its progressive approach toward each unique travel experience. Travel Leaders Group assists millions of travelers through its leisure, business and network travel operations under a variety of diversified divisions and brands including All Aboard Travel, Andrew Harper Travel, Colletts Travel, Corporate Travel Services, CruCon Cruise Outlet, Cruise Specialists, Nexion, Protravel International, SinglesCruise.com, Travel Leaders Corporate, Travel Leaders Network and Tzell Travel Group, and its merger with ALTOUR. With more than 7,000 agency locations and 52,000 travel advisors, Travel Leaders Group ranks as one of the industry’s largest retail travel agency companies.

Elliott Advocacy is underwritten by Travelers United

If you’ve been mistreated by the airlines, Travelers United is your voice in Washington. Join the #1 travel advocacy organization working with Congress to improve and protect travelers. Plus, get $400 of annual benefits you can use for travel for only $29/year. Add your voice to ours. Make travel better.  Join today.

Send this to a friend