A Junk Fee Prevention Act to eliminate resort fees and other mandatory hidden fees is being proposed by the president of the United States to members of the House of Representatives in the name of promoting competition in the economy while simultaneously saving citizens billions of dollars per year.
Junk Fee Prevention Act to Eliminate Resort Fees?
“When families set their budget for a vacation, they expect that the hotel price they see is the price they will pay”, Joseph R. Biden said yesterday, Wednesday, February 1, 2023, according to this official statement and press release from The White House. “But many travelers encounter surprise ‘resort fees’ or ‘destination fees’ when they check out or at the end of a lengthy online reservation process. These fees harm consumers by preventing them from the seeing the true price when they pick out a hotel and by limiting their ability to comparison shop. Over the past decade, a growing number of hotels have imposed these fees on consumers, which can be $50 or more per night. More than one-third of hotel guests report having paid such fees. And the total costs for Americans are enormous: according to one report, hotels collected billions in these fees and surcharges in 2018.”
Members of the Competition Council — which was created in 2021 to promote competition across the economy and lower costs for families — were asked by Biden to take on the unfair hidden fees known as “junk fees” that are allegedly taking real money out of the pockets of families across the United States. Those junk fees include but are not limited to:
- Surprise banking overdraft fees
- Excessive credit card late fees
- Hidden hotel mandatory resort fees
- Substantial termination charges to stop you from switching cable plans and Internet plans to a better deal
Furthermore, Biden “urges Congress to ban these surprise fees by requiring that hotels include them in the price of the room, so consumers aren’t surprised. Travelers should know which hotels charge these fees and which ones do not, so that they can plan and budget accordingly.”
The Federal Trade Commission of the United States began to work on rules which is designed to crack down on unfair and deceptive fees across all industries — mandatory fees that were never disclosed — and avoiding mandatory fees such as resort fees is virtually impossible. The new rules would require airlines, lodging companies, and other travel sites to disclose fees up front.
“The Department of Transportation (DOT) proposed a rule to require airlines and online booking services to show the full price of a plane ticket up front, including baggage and other fees”, Biden said. “DOT also published a dashboard of airline policies when flights are delayed or cancelled due to issues under the airlines’ control, leading 9 airlines to change policies to guarantee coverage of hotels and 10 airlines to guarantee coverage of meals, none of which was guaranteed before.”
Ban Fees For Family Members to Sit With Young Children
The president of the United States believes that no parent should have to pay extra simply to sit next to his or her child, as many airlines currently charge a fee to select a seat in advance — including for customers who travel with children — which means that parents can find themselves unexpectedly not seated with their young child on a flight is indeed a possibility.
The following statement was posted on the official Internet web site of the Department of Transportation of the United States on Friday, July 8, 2022 — along with this link to a document in Microsoft Word format:
The Office of Aviation Consumer Protection (OACP) has issued a notice urging U.S. airlines to do everything in their power to ensure that children who are age 13 or younger are seated next to an accompanying adult with no additional charge. Although the Department receives a low number of complaints from consumers about family seating, there continue to be complaints of instances where young children, including a child as young as 11 months, are not seated next to an accompanying adult. In four months from the date of this Notice, OACP plans to initiate a review of airline policies and consumer complaints filed with the Department. If airlines’ seating policies and practices are barriers to a child sitting next to an adult family member or other accompanying adult family member, the Department will consider additional action consistent with its authorities.
Almost seven months have elapsed; and still, no airline guarantees that a family may be seated together aboard an airplane for a flight without having to pay a fee. In response, Biden is calling upon members of the House of Representatives to “fast-track the ban on family seating fees so that the DOT can crack down on these practices more quickly than through a rulemaking.”
Final Boarding Call
Mandatory resort fees and their ilk usually are of little to no value to consumers. They are simply a vehicle with which hotel and resort properties can drive more revenue without delivering something of value in return.
Although I applaud the current president of the United States to finally take on mandatory fees which have especially become a scourge in the lodging industry, I do not completely agree with everything he said in the aforementioned press release:
- First, he complained about certain fees that are charged by airlines. I believe that all companies have a right to charge what they want and let the free market dictate whether the fees are fair. They should not be allowed to hide those fees from the customer — especially when advertising a room rate with the mandatory fee excluded to deceive the customer into thinking they are initially getting a better rate — but these companies do have a right to earn as much revenue and profit as possible.
- Second, his comment back on Wednesday, October 26, 2022 about hidden junk fees being “unfair, and they hit marginalized Americans the hardest, especially low-income folks and people of color” is gratuitous at best and does not advance the argument. Some people consider that comment as accusing the companies which charge those hidden junk fees as being racist, as saying that was simply not necessary to prove his point, as they affect all people who travel.
As for the Consumer Financial Protection Bureau to propose a rule that is projected to reduce excessive credit card late fees from roughly $30.00 to $8.00 — pursuant to its authority under the bipartisan Credit CARD Act of 2009 — I disagree even though it is forecast to save consumers as much as $9 billion a year in late fees. Instead, how about consumers not causing credit card companies to charge them late fees in the first place by paying their credit card statements on time?
I do not believe in intervention by the government to interfere with the free market; but these mandatory fees — creative as they may be and which are specifically designed to initially obfuscate the true cost of travel — are out of control. Unfortunately, consumers seem to be more resigned to paying them out of frustration rather than boycotting hotel and resort properties which charge them — especially as more and more of them do so to create extra revenue for themselves.
A mandatory room fee is no different than a mandatory destination fee, mandatory resort fee, mandatory amenities fee, mandatory facilities fee, or a mandatory damage waiver fee, of which links to past articles which have been posted here at The Gate are found here in this article.
I have no problem with lodging companies profiting from its customers; but that I vehemently oppose the implementation of mandatory daily resort fees, facilities fees and destination fees is no secret to you if you have been a reader of The Gate for years. They should either be optional or eliminated altogether, in my opinion…
…but I do not believe that will happen anytime soon in the potency for which Biden hopes…
Photograph ©2016 by Brian Cohen.
