Just Say No to Resort Fees: the FTC Now May Have Your Back

Just Say No to Resort Fees: the FTC Now Is Back on the Attack

by Robert McGarvey

 

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$2.04 billion. That is how much advocacy group Travelers United said was collected in resort fees in 2015. That is up 35% from 2014.

The breaking news: the FTC apparently has decided to renew its attack on resort fees. More on that below.

For now, feast on more bad news: 1,671 hotels and lodging sites in the U.S. charged resort fees, said Travelers United.

Said Travelers United, “The average mandatory resort fee reached $24.93 in October 2015 hotel listings online, a 30 percent increase over the $19.20 average resort fee of online listings in December 2014. Resort fees in Florida were highest, with an average of $28.63 across 549 hotel listings.”

Resort fees are also high in Hawaii, Las Vegas, and San Diego. But they show up in small towns, big cities, and where we may least expect them.

How in an era of minimal inflation can resort fees nudge up 30%? Because they can. Because no one is watching.

You know what you get for a resort fee: bupkis mainly. A newspaper you don’t want. Bad and insecure inhouse WiFi. Maybe local calling. Pool towels. A lot of stuff that, well, is what you might expect to see at a resort anyway or that you don’t likely want. (Do you ever use an inroom phone?)

Usually too free parking is in the package – but only if it’s parking nobody would happily pay for. That is, hotels in Manhattan and San Francisco won’t throw in parking – not when they can nick guests $50, sometimes higher, for it. But if it’s a suburban resort with a vast parking lot, sure, they will throw it in under the resort fee.

Guided hikes – not in the package usually. Ditto for classes led by experts (surcharged on a case by case basis). Cooking classes – forget about it.

A rule of thumb: the good stuff comes with a price tag. The rest is covered by the resort fee.

The only bright news here: the Federal Trade Commission is going after resorts that hide their resort fees. That’s a position flip flop. Last summer the FTC seemed to shrug and accept resort fees. Now it is back on the warpath and it is prodding Congress to consider legislation regarding resort fees.

Personally, we are not for or against resort fees. What we are against is hiding the fees and springing them on consumers as they check in (sometimes not until check out).

That is the real irritant. A hotel can charge whatever it feels the market will bear. That is the system.

But hotels cheat when they have a room rate and on top of that is a resort fee – usually upwards of $25 – that is presented as a kind of footnote. Go ahead, see if you can find it when making a reservation via mobile. Ditto with reservations via Online Travel Agencies (OTAs).

Hiding fees is just sneaky.

Hoteliers, as a group, present delusions when justifying resort fees. They will tell you everybody does it and they would be at a competitive disadvantage if they in fact built those charges into the room rate.

But everybody does not do it. The American Hotel and Lodging Association said that only about 7% of hotels charged resort fees, meaning 93% do not.

Some greedy hoteliers do it because it is a fast way to goose the black ink. Resort fees mean profits.

But my favorite is when hoteliers say that we – the consumers – like resort fees because it bundles in a lot of charges that otherwise we would have to pay for a la carte. Except some 87% of consumers have said they would be “less willing” to stay at a hotel that charges a resort fee. That does not sound like a whole lot of loving, does it?

Hoteliers also tell us resort fees represent real “value” because, if bought a la carte, the various things thrown into resort fees would cost more.

The fallacy there of course is that just about nobody would buy all the stuff covered by resort fees. Some might buy none at all – and those guests still are stuck with paying a fee for “amenities” they don’t want.

Can you dodge resort fees? Road warriors tell us they often do, simply by saying at check out that the fee had not been adequately disclosed. If there’s resistance, say you will complain to the FTC which already had begun investigating complaints about hidden resort fees….and actually file that complaint.

Does that always work? Nope. But all we can do is lift our voices in protest – and hope our complaints fall on sane ears.

Proof That Air Miles Are Approaching Null Value

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by Robert McGarvey

 

The pop-up holiday shop at Terminal C in Newark Airport drove the point home: air miles are plunging towards no value.

United opened the shop – which may or may not close – to give MileagePlus members a place to burn miles on, well, stuff such as gadgets, cookbooks, suitcases and more.  Last I heard United was saying they might keep it open and that is because there is a need for a place where miles are a currency.

That’s on top of an existing program in Terminal C that let MileagePlus members buy food and drinks at a half dozen restaurants such as Abruzzo Italian Steakhouse and Oeno Wine Bar. The directions on how to use are cumbersome so if this appeals to you, read them.  

And of course United has deals with dozens of online retailers – from Crate and Barrel to Tumi – that lets us buy stuff with miles.  

Other carriers do likewise.

There is a lesson in this.  Miles no longer are a currency with their issuers, the airlines, at least not for their core products, flights.

Miles really – honestly – no longer equate to free flights and free seat upgrades.  Those two ways are how I have spent all the miles I have ever accumulated and I have gotten business class travel, flights to Europe, cross country flights for myself and friends. It has been good.

But it is over.

The reason: airlines have made it so very simple to accumulate air miles without flying, by tempting us with credit cards that for every purchase shower miles on us.  Buy a week’s worth of groceries at Whole Foods and, well, that’s 300 miles. Over a year that is 15,000 miles and soon we are in striking range of a free flight. Just for buying food.  

Except those free flights are ever harder to claim because more of us want them, just at the time that there are ever fewer seats available for rewards programs. Something has to give in that equation — thus it is ever rarer to score rewards travel you actually want.

I am guilty too. In my wallet are a United credit card, via Chase, and an American Airlines credit card via Barclays.  I have them because of their perks, mainly priority boarding and free bag check.  I have them because airlines forced me to get them.

As airlines have joined in making elite status ever harder to attain – basing a ticket’s mileage value on price paid, not miles flown – many industry experts such as Joe Brancatelli have suggested that now is the time for many fliers to forget pursuing elite status and instead buy pieces of it via the airline credit cards.

Wrote Brancatelli in a recent column: “For most business travelers, frequent flier programs are no longer a compelling proposition.”

He added: “The 20 percent devaluations that the big carriers surreptitiously folded into their switch to revenue-based recognition sharply increases the price of award travel. There are many fewer upgrades to be had and the basic benefits (priority boarding and free checked bags) are available to anyone who acquires the airlines’ proprietary credit card.”

Agreed.

But the irony is that as more of us grab those airline credit cards, more miles get minted, they get harder to redeem on flights, and so we are forced to spend miles on airport food and maybe an overpriced suitcase at an airline store.

It’s a vicious cycle. But it won’t get better.

That is why I have resigned myself to the probability that I have very, very few free – paid by miles – flights in front of me.  I used to plot, connive, and save miles with a particular flight in mind.  I don’t anymore. I have plenty of miles for a flight on United. But just one. I spent all but a handful of my American miles on a flight recently and have no intention of rebuilding my balance.

I am at peace.

Now, if only I can figure out what to do with the 250,000+ points I have on an American Express card and, yes, when I have redeemed Amex points in the past it has only been for flights.  Never on hotels or meals or Amazon purchases.

We’ll see if I can maintain that record.