Resort fee

Resort fee is a noun phrase with different meanings depending on the user. Many lodging-industry members use the words "resort fee" to identify a charge to rental guests in addition to the charge for room rental. The fee normally offsets costs of doing business, especially costs for services (or products) resulting directly from room rental, such as housekeeping, linen replacement, coffee, toiletries, etc. Indeed, room rental rates may vary widely according to season, but the resort fee is normally a fixed amount charged nightly without change for a year or more.

By separating the fee from room rates, the hotel may manage expenses more efficiently, which benefits owners, or guests, or both. Consumers should add the room rate to the fees to compare prices of rooms in the market.

In the past, however, the existence of an additional fee has been allegedly not well-publicized especially where the guest asserts that it did not discover the fees until check-in.[1] Internet price comparison engines such as Priceline.com might not have included the precise amount of the fees, and consumers frequently did not inquire prior to check-in.

While the fee is normally an allocation of many discrete lodging-industry expenses, certain advertisements have stated that the fee includes, e.g., access to amenities such as swimming pool, internet access, fitness center usage, parking, and a daily newspaper. At most, such advertisements are mere puffery.

Use of the phrase "resort fee" appears most common in Florida, Hawaii, and Nevada. Even, so, the practice is commonplace in the US, and the fees in 2016 can be more than $30 per night.

Weighing the Benefits

MGM Resorts International senior vice president Mr. Alan Feldman, has said:

“We have heard negative feedback from guests, but we’ve also heard positive feedback, from guests who are happy that they are no longer paying à la carte for different services. They don’t feel nickeled and dimed.” [2]

Hotel chains may recognize resort fees as revenue or as offsets for expenses. MGM Resorts International stated the following regarding Las Vegas hotel rooms during a Q1 2011 conference call:

"Our RevPAR (revenue per available room) in the first quarter was up 16%, including resort fees. Excluding resort fees, REVPAR was up 11% in the quarter year-over-year."[3]

Offsets to Expenses

An incomplete list of the amenities covered by a so-called "resort fee" include (note: these vary by resort):

Online hotel brokers

Some online bidding engines, such as Priceline.com, might not have fully disclosed the amount of the fees as part of their booking checkout screens. For example, Priceline's 'Name Your Own Price' listings state the following:

"Depending on the property you stay at you may also be charged (i) certain mandatory hotel specific service fees, for example, resort fees (which typically apply to resort type destinations and, if applicable, may range from $10 to $40 per day)".[4]

Consumers may inquire about the precise amounts charged as fees before purchasing the room. Although Hotwire is an "opaque" booking engine, it now discloses fees during the booking checkout screens. In the case of conventional bookings, a customer can identify the fee before committing to staying at the hotel. Some bookings require the potential guest to prepay an non-refundable amount.

Be Informed

In 2012, the Federal Trade Commission advised 22 hotel operators that their online rate quote totals, which did not include certain fees, may need to be updated to comply with FTC regulations.[5]

The Federal Trade Commission states the following to consumers:

If you’re not sure whether a website is showing you the total price, call the hotel and ask about a “resort fee” or any other mandatory charge. Listing the “resort fee” near the quoted price or in the fine print — or referring to other fees that “may apply” — isn’t good enough.[6]

Notes

  1. ↑ http://travel.nytimes.com/2006/03/12/travel/12prac.html
  2. ↑ http://www.nytimes.com/2011/09/25/your-money/hidden-fees-in-travel-deals-revisited.html
  3. ↑ "No Transcript Data". morningstar.com.
  4. ↑ https://travelc.priceline.com/customerservice/customerservice.do?c=&t=taxes+fees&f=searchquestion&p=HOTEL&question=1112&jsk=5064010a5564010a201109202329344b8021892445&plf=PCLN
  5. ↑ Marnie Hunter, CNN (28 November 2012). "FTC warns hotels about 'resort fees'". CNN.
  6. ↑ "Travel Tips". ftc.gov.

Resources

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