Hotels pile on resort fees and other extra charges
The Mirage hotel in Las Vegas seemed like an amazing summer deal on Expedia: $74.35 for the room and $7.18 in taxes. However, the smug traveler...
Detroit Free Press
Hotels rake in $1.95 billion in fees this year
The U.S. hotel industry is expected to collect $1.95 billion this year from such things as Internet fees, telephone surcharges, business-center fees and resort fees, according to a study by New York University professor Bjorn Hanson.
That's a 5 percent increase from last year, when hotels amassed $1.85 billion.
Still, the airline industry collects far more revenue from fees than hotels. Last year, 50 of the nation's largest airlines collected an estimated $22.6 billion in fees.
Hugo Martin / Los Angeles Times
The Mirage hotel in Las Vegas seemed like an amazing summer deal on Expedia: $74.35 for the room and $7.18 in taxes. However, the smug traveler likely did not notice the fine print caveat: An additional $25 per-night "resort fee" would be charged when you checked in.
What did the fee cover? In-room Wi-Fi and use of the pool and facilities, even if you did not use them.
The resort fee did not cover snacks in the room, where a 3.75-oz mini bag of trail mix was $12. At the pool, a small can of beer was $7.50. It cost $16.95 to see two dolphins in the "secret garden."
The Mirage is not alone in its creative ways of separating customers from their money. It's just doing what other hotels across America are doing these days: "unbundling" services the way airlines do, nickel-and-diming customers with mysterious, made-up fees.
Often called "resort charges" or just "service fees," they are vague and usually are not charged until the customer arrives at the hotel. The fees work for hotels because most customers tend to be only interested in the base rate and impatient with fine print.
Hotel websites and online travel-booking sites dutifully note the fact these resort fees exist — in small print below the big, exciting boldfaced price of the room. Expedia, for example, states that "some properties have extra fees for amenities or services that may apply even if you don't use them." Expedia clearly lists the $25 resort fee for Mirage — but I wonder how many people actually read that far.
Is there anything the customer can do to avoid these fees?
Yes. Book hotels that don't have them. Or factor the fees into the true total cost of the stay. It still may be a deal; even with the fee, The Mirage room was only $106.53 a night.
Meanwhile, there are some new twists in car rentals and airline tickets that can cost travelers:
Cars: Most car rentals have unlimited mileage — but mileage restrictions are creeping into the marketplace — 25 cents a mile after 150 miles, for example. If a price seems extra good, double-check the "rules and restrictions" clause for mileage charges. Also make sure your rental price includes taxes and fees. Sometimes they can be higher than the rental price itself.
Airlines: I flew Allegiant Air recently, and although I know the low-fare carrier charges for both checked and carry-on baggage, the price was so cheap it still was worth it. But when I checked in online and tried to pay for my carry-on, it gave two prices — cash or credit, just like at the gas station. It was $12 if you used a debit card, $13 if you used a credit card.
That reflects the recent settlement between big merchants and credit-card companies that allows merchants to pass along to customers their cost of processing credit-card transactions. Allegiant, naturally, is presenting it as a "debit-card discount," not a "credit-card surcharge."
Yet I am alarmed by the enticement to use debit cards — essentially paying cash — for airline tickets or other kinds of travel products. Credit cards carry protections debit cards don't have. If the company goes under without providing you the service, or if they double charge you, you can contest the charges through a credit card. If you paid cash via debit card, oops, too bad.