Resort fees make their way to hotels…

Many of you are probably familiar with resort fees, whereby resorts charge a mandatory daily fee that covers basic hotel amenities. It’s nothing but a sneaky way to artificially raise rates by not clearly disclosing fees up front and screwing travel agents out of commission (since they would earn a commission on base rates, but not a resort fee).

Well, it seems that we’re now seeing hotel fees, which sets a very bad precedent. Starting January 1, 2013, Le Parker Meridien New York City will charge a mandatory $10 “facilities charge,” which apparently includes the following:

  • Wired or Wireless High Speed Internet Access for multi-devices in guestrooms, the lobby, restaurants and the bar.
  • Unlimited use of gravity fitness Center.
  • Unlimited use of the penthouse pool.
  • Unlimited toll free and local calls from your in room phone.

Even worse than a mandatory charge is that they don’t disclose it upfront. When you look at the price breakdown on spg.com while making a booking at the hotel, this is what’s displayed for a sample date search:

As a matter of fact the only way to even know about the fee is through the “Special Conditions” tab that appears on the initial search page.

Not only is the concept of a mandatory fee at a city hotel (let alone a resort) ridiculous, but even worse is the complete lack of disclosure on this. I really hope they reconsider, or at least very clearly disclose this clearly at the time of booking. Also, I hope this is waived for Platinum members, as they receive free internet anyway, so are the ones that would really get screwed by a policy like this.

(Tip of the hat to Mike)

Comments

  1. I am sort of curious what the prices were for this stuff before. Was pool/fitness center access not included? $10/night for internet at a big city hotel is a fairly decent deal — if you were going to be paying for it otherwise. I wouldn’t be surprised if the rise of 4G hot spots and more clearly defined elite benefits, including complimentary internet, have really started to hit some of these places that use to relying on the extra revenue due to their monopoly on customer internet service.

  2. @ AdamH — It’s actually not a bad value, but the thing is that these benefits will indirectly be devalued to those that would otherwise pay for them — the pool and gym will be more crowded, internet slower, etc.

  3. didn’t the FTC come out with a ruling on this recently regarding disclosure?

    Living here in Hawaii, the crappy Starwoods here do it and they have not waived the fee for platinums in the past, usually just a free cattle call breakfast for one person only. Not sure if that has changed.

  4. The conduct won’t last, the FTC will start fining hotels for not disclosing the fees upfront. This sucks for travel agents though.

  5. The practice is disgusting. Bravo to you for actually having a substantive post instead of the usual gibberish like asking people to vote where you should vacation.

  6. Dispute the charge if it wasn’t disclosed at booking. If they won’t waive it, take them to small claims.

  7. I stayed at this hotel almost every week for 3 months in the fall of 2011.

    If I recall correctly, they always charged for the use of Gravity, the fitness centre (which, by the way, is fantastic and has group exercise classes). I think it was $10. It was always waived for Platinum.

    So, this fee is a good deal for non-elite members but a terrible deal for SPG elite.

  8. Here’s the full text of the letter that the FTC sent to several hotel operators with regard to resort fees: http://www.ftc.gov/os/2012/11/121128hoteloperatorsletter.pdf

    The most important part, I think, is that the FTC warns that it believes that hotel operators should quote the all-in pricing (including all mandatory taxes fees) as the most prominent price, much in the same way that the DOT now requires all-in prices to be the most prominent for airfare. I’m concerned that the FTC lacks the teeth to enforce this for hotels that the DOT has to enforce it in airfares, but I think the letter shows a strong willingness to pursue the issue. It could dramatically change the way that hotel prices are advertised.

  9. I really hate those resort fees. I’m currently staying at the Sheraton Maui where the resort fee is now $30 per day. It includes the following:
    – unlimited in-room Internet
    – unlimited Internet access in the lobby and common areas
    – self parking
    – unlimited local calls
    – toll-free phone call access up to 60 minutes
    – shuttle to town
    – authentic Hawaiian cultural poolside activities

    This is really getting ridiculous. I don’t use any of this stuff especially since SPG Platinums get free Internet anyway (which is painfully slow). Yet they make it sound as if they’re doing you a favor by including it in a daily fee.

  10. It definitely should be illegal to not display all fees, etc. upfront. It is no better than eating at a restaurant and getting a $25 meal, eating it and then finding out there is a $10 fee for using the silverware.

    I have no idea why hotels are allowed to get away with this.

  11. LPM NYC is The most overblown, overrated, overpriced hotel out there. This is yet another reason not to stay there. The rooms are ugly and downright uncomfortable; the staff largely aloof; the prices of everything from the $22 cheeseburger and fries to the $100 pancake breakfast for two are just short of obnoxious.

  12. Do you even earn SPG points on these mandatory fees? If not, it’s an even bigger ripoff than I thought.

  13. I wish they would make an example of a hotel manager and send a few people to jail, if only for a few days. A fine is not enough. This is out and out fraud. Crime is paying all too well for the big boys. They fully understand that they are committing a fraud to cheat the search engines, the travel agents, and the consumer. Where is the federal government? I can write a sternly worded letter myself. I expect more than a stern letter from our public servants charged with law enforcement. Arrest somebody already!

  14. You presented a good case — up until this unnecessary point: “Also, I hope this is waived for Platinum members, as they receive free internet anyway, so are the ones that would really get screwed by a policy like this.“ If it is waived for Platinum members, then suddenly a facilities fee is not so bad? That is what that statement implies. Eliminate these ridiculous fees for EVERYONE — period.

  15. If you book through the UK website, dispute the fee with VISA/MC. As the UK website will have broken UK law in failing to disclose the true price, you will get your money back.

  16. It doesn’t surprise me that the first (?) SPG hotel to do this is Le Parker Meridien. I had a terrible customer service experience with them. My Platinum concierge escalated it up to the GM of the hotel and the answer was that they simply didn’t care about me or my business. So I’ve already sworn off ever staying there again, though if I hadn’t, this story would make me do so.

  17. I just signed a White House-sponsored “WE the PEOPLE” petition calling for airlines to fully disclose their fees for checked bags, seat assignments and other services so that we can see, compare and buy the complete air travel package in one place without having to search a bunch of airline sites. I hope you can sign the petition too at http://wh.gov/IXhH. (BTC.travel)

  18. This is an incredibly deceptive practice that should be stopped. The Mandarin Oriental Las Vegas has the same nonsense but they call it Golden Access ($24/night). The FTC is looking into these practices but like all government agencies they are as slow as molasses.

  19. @ Michael T — Sorry, there was some sub text about it only being valid under certain circumstances. Updated it now.

  20. @ PSL — You don’t.

    @ Brian Cohen — That’s not how I meant it. I said clearly up front they should get rid of these. I’m simply saying that Platinum members get “taxed” twice with these kinds of fees, since they rarely get anything out of them.

  21. I was a little surprised at the attempted resort fee charge at Harvey’s Lake Tahoe last week. I guess they charge them at the casinos down in Vegas, but Northern Nevada now too? No bueno.

  22. @Lucky,
    Thank you very much for discovering this hidden charge. I followed your post (1K bonus pts for 1st stay and 2K pts for 2nd stay) to just book two stays next week (Tues 12/11 and 12/13) at Le Meridien in DC. I will look carefully at whether they charge a similiar fee. That is a ridiculous behaviour. Starwood should not treat us (Platinum members) this way.
    As a Starwood Platinum member, I am all for you. How about you organize an event so that we will file a formal collective or individual complaint to Starwood?

  23. All those things are properly included in the room rate. They may as well claim that the extra fee includes putting sheets on the bed, or maybe use of the elevator. I’m sure the FTC will be just as inactive as ever – no, a stern letter is not enforcement – but if this is a tax dodge as well as fraud on the customer, what about NYC Department of Finance?

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