FTC Urges Hotels to Disclose Resort Fees Up Front

Dec 03, 12 | 12:04 am

By Barbara Delollis

Hotels that charge customers between $10 and $30 extra in fees per night without fully disclosing them during the price-quote process could face pressure from the federal government.

This week, the Federal Trade Commission sent a warning letter to 22 unidentified individual hotels that says that failing to include resort fees during the booking process could be deceptive - and considered illegal. The hotel industry's main lobby will soon issue a notice to members saying anyone who receives a letter should seek the advice of a lawyer.

"This is good news for consumers," says Bjorn Hanson, divisional dean of New York University's hospitality school. "This is also good news for many hotel employees who respond to guests' concerns or complaints about resort fees."

The FTC's unusual attention to hotel pricing could ultimately bring more consistency to the way that hotels advertise fees to travelers as they plan trips and set their budget, he says. Hanson does not believe the fees will go away or be bundled into rates, because they would increase the room rate and, in turn, the amount paid in bed taxes.

The fees are fairly common in resort destinations such as Hawaii and Las Vegas, yet Hanson says that luxury urban properties are starting to adopt them, too. The newly opened SLS South Beach in Miami, for instance, charges a $20 daily fee, an amount that's disclosed up front on the hotel's website during an initial price check.

These daily fees — often called "resort fees" — may include services such as use of gym or pool facilities, Internet access and local calls, as well as items such as bottled water, mini-bar snacks and newspapers.

The FTC takes issue with the fees when travelers aren't told about them before they make their reservation, says Serena Viswanathan, a staff attorney with the agency who's working on the case. The agency would like to see the total cost of a night's stay quoted to consumers with resort fees broken out just like taxes are now, she says.

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