Have you thoroughly checked your receipt after a stay at a hotel lately?
It may include resort fees you were unaware of when you made the decision to stay at the hotel — and the price may have been way higher than what you originally thought it would be.
According to a lawsuit filed by Washington, D.C.’s attorney general, Karl A. Racine, in the Superior Court of the District of Columbia, some hotels aren’t being transparent about resort fees. And they aren’t always offering amenities like actual resorts, either!
In prepared remarks given to the press earlier this month, Racine said, “For at least the last decade, Marriott has used an unlawful trade practice called ‘drip pricing’ in advertising its hotel rooms whereby Marriott initially hides a portion of a hotel room’s rate from consumers. Marriott calls this hidden portion of the room rate a number of terms, including a ‘resort fee,’ ‘amenity fee,’ and a ‘destination fee.'”
Isn’t that what the original price includes anyway?
Attorney General Karl A. Racine’s lawsuit against hotel giant Marriott International accuses it of price deception because of the way it lists the resort fees.
It was after an investigation by attorneys general in every state in the U.S. that Racine decided to file the lawsuit. Here’s his tweet announcing the move:
ICYMI: Last week, I sued Marriott International for charging consumers deceptive “resort fees” when booking hotel rooms.
Through these fees, Marriott hides the true price of rooms and misleads consumers to increase company profits: https://t.co/3IYIVmJ0Wy
— AG Karl A. Racine (@AGKarlRacine) July 15, 2019
And another lawsuit, filed this week by Nebraska’s Attorney General Doug Peterson, claims that Hilton Dopco Inc. hotels do the same thing. He accused the hotel chain of not disclosing booking fees, misleading customers about what resort fees pay for and hiding the true price of hotel rooms.
“For years, Hilton has misled consumers in Nebraska regarding the true cost of certain Hilton hotel rooms,” Peterson said in a statement. “They failed to heed warnings from the Federal Trade Commission and the mounting complaints from their own customers.”Getty Images | William Thomas Cain
What’s happening that has everyone so upset?
The resort fees are often not disclosed in the price you see on an advertisement. The AGs don’t like that people are finding out about the resort fees after they book their rooms.
Racine said in his remarks, “By charging resort fees and by failing to clearly disclose them to consumers up front, Marriott has found a way to increase profits without appearing to raise prices. In some cases, Marriott even leads consumers to believe that resort fees are charges imposed by the government.”
So, for example, if a hotel says it is currently offering rooms for $130 a night, you might pay WAY more than that once all the fees and taxes are added. The attorneys general are watching out for consumers in asking the hotels to include the resort fees in their advertisements, so everyone knows the actual cost before they commit to a purchase.
Racine’s lawsuit says Marriott International has made millions in profits from the allegedly hidden resort fees, which range from $9 to $95 per day. Meanwhile, 1011Now reports that at least 78 Hilton resorts charge hidden fees up to $45.
A Marriott spokesman says the company does not comment on pending litigation, but told Travel Weekly, “We look forward to continuing our discussions with other state AGs.”
“I don’t think they’re going away,” Marriott CEO Arne Sorenson said about the fees in an interview with LinkedIn, “I think we do want to make sure we are delivering value for them. And you can only do that in some markets and some hotels.”
A Hilton spokesperson told the AP that company officials have not yet seen the lawsuit, but claims its fees are fully disclosed to customers that book through company channels.
Bjorn Hanson, a hospitality industry consultant in New York, told Consumer Reports that in 2018, the hotel industry took in a whopping $2.9 billion in resort fees and other surcharges. Imagine if vacationers could have spent all that dough at the shops, amusement parks and restaurants around those hotels instead!
It’s probably safe to say consumers are angry over the hidden resort fees that supposedly cover facilities they may not even get to use.
The AGs aren’t the only ones wanting hotels to be more up front about their prices. Expedia and Booking.com are asking hotels for more honesty so that they may also give customers the real deal. This can also help their bottom line since these travel websites weren’t getting any percentage of the resort fee — at least, until recently.
In May, Booking.com said it would start charging hotels commissions on their resort fees starting in June 2019. Since hotels have often used resort fees to circumvent giving more income to third-party booking sites, this is a big deal. Expedia told Skift in June that hasn’t ruled out following Booking.com’s example.
Hotels that aren’t more clear on their fees and proper pricing before check-in could face punishment from these third-party services: Such websites are likely to provide less promotion for those hotels, for example.
Thank you to the people fighting the good fight on behalf of consumers! We always advocate for more transparency — and protections against advertisers duping customers.
Are you looking for a cheap getaway? Check out our list of the 10 best budget hotels according to TripAdvisor.