Capitol Hill Weekly Roundup: Reactions to President Biden’s Junk Fee Crackdown Pledge
Since President Joe Biden mentioned them in his Feb. 7 State of the Union address, “junk fees” have remained at the forefront of hotel and airline industry news.
Biden urged Congress to pass a new “Junk Fee Prevention Act,” which would have four objectives:
- Eliminating “excessive” online concert, sporting event, and other entertainment ticket fees.
- Banning airline fees for family members to sit with young children.
- Outlawing “exorbitant” early termination fees for TV, phone, and internet service.
- Blocking surprise resort and destination fees.
“Americans are tired of being played for suckers,” Biden said, noting that his administration is prioritizing a crackdown on junk fees.
This includes “resort fees” charged by hotels and fees from airlines for families to sit together.
“Junk fees may not matter to the very wealthy, but they matter to most folks in homes like the one I grew up in. They add up to hundreds of dollars a month,” Biden said. “I know how unfair it feels when a company overcharges you and gets away with it.”
“We’re going to ban surprise resort fees that hotels charge on your bill. Those fees can cost up to $90 a night at hotels that aren’t even resorts.”
The American Gaming Association wrote in a letter to the FTC that resort fees should not be part of the Junk Fee Prevention Act.
“Resort fees at our members’ properties are charged for services that provide substantial value to customers, enhance the quality of their stay, and distinguish resorts from standard lodging offerings,” AGA CEO Bill Miller wrote.
The casino industry doesn’t hide resort fees, Miller explained.
Miller added that the industry has been transparent about resort fees for a long time instead of solely including charges in an all-in pricing section.
Resort fees were first charged at high-end properties in the 1990s.
A report from a New York University School of Professional Studies Jonathan M. Tisch Center for Hospitality professor indicates that the hotel industry collected $1.85 billion in resort fees in 2011. The number increased to around $2.93 billion a year by 2018, the report showed.
The Biden administration’s focus on junk fees is having a growing impact.
Earlier in February, California Attorney General Rob Bonta and Democratic state Sens. Bill Dodd (D-Napa) and Nancy Skinner (D-Berkeley) co-sponsored legislation that would make it illegal to advertise, display or offer a price of a good or service that does not contain mandatory fees or charges aside from government-imposed taxes.
“Prices advertised should be the price you pay. Plain and simple,” Bonta said in a video statement. “Whether renting a car, booking a hotel room, or purchasing concert tickets, we all know how frustrating it is to get to the checkout and find out that something advertised as one price actually costs much, much more.”
Hidden fees have moved into other areas, including car rentals, event ticketing and food delivery charges, Dodd added in a statement.
“Californians are sick and tired of dishonest fees being tacked on to seemingly everything,” Dodd said. “It’s an underhanded trick to boost corporate profits at the expense of those who can least afford it.”
During his State of the Union address, Biden also addressed airline fees.
“We’ll prohibit airlines from charging $50 roundtrip for a family just to be able to sit together,” Biden said. “Baggage fees are bad enough. Airlines can’t treat your child like a piece of baggage.”
On Feb. 20, United Airlines announced that it is using new seat mapping software that will make it easier for parents to sit together with their children without incurring additional costs. This applies even if they are traveling on basic economy tickets.
If seats next to each other are not open because of last-minute reservations or unscheduled flight changes, families can switch to another flight at no cost without getting charged for a fare difference.
United’s new policy will be fully implemented by early March. Beforehand, customers traveling with children under the age of 12 will immediately see adjacent seat options.