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Don’t Let Tacked-On Hotel Fees Catch You By Surprise

Jun 12, 2014
2014 / July 2014

Ever been surprised by an early check-out fee, a gratuity fee (even though you rolled your bag to your room) or a minibar restocking fee added to the room rate when paying your bill? How about a city tourism tax or an energy surcharge?

Surprise hotel fees and surcharges — fees tacked on to the room rate you expected to pay — can shock a traveler. To hoteliers, however, fees and surcharges are a boon because they add extra money to their coffers.

Fees and surcharges above the hotel room rate aren’t new — they emerged as an industry practice in 1997 — but the rapid rate at which they are growing is startling. According to an August 2013 trend report by Bjorn Hanson, divisional dean, Preston Robert Tisch Center for Hospitality, Tourism and Sports Management, New York University School of Continuing and Professional Studies, U.S. hotels collected a record $2 billion in total fees and surcharges in 2012. He forecasted the amount would increase to a new record level of $2.1 billion in 2013.

Today, Hanson notes the report was on track when it concluded, “The increase for 2013 reflects a combination of approximately 2.25 percent more occupied hotel rooms than in 2012, more fees and surcharges, and higher amounts charged at many hotels for a total increase of approximately 6 percent.”

While room rates are subject to occupancy taxes, the added fees and surcharges are not. “From the hotel’s point of view, there are higher costs and not much increased revenue, so fees and surcharges are a way to increase revenues,” says Hanson.

Although frequent travelers believe they’ve uncovered all of a hotel’s extra fees, they may still find themselves surprised. Even Hanson has been taken aback. “I arrived at night and left at 6 a.m., and the portfolio had a housekeeping charge.” He called to question the charge and was told the hotel didn’t have that fee now. This just confirms how rapidly fees can change. “If the fees are very unfavorably received by guests, they may be discontinued,” Hanson notes.

From the guest’s view, if fees aren’t obvious, it seems unfair. “Hotels have been very good at listing the charges, but it’s the guest’s job to look for the extra charges,” Hanson says. For example, watch out for minibar charges. A can of soda might be priced at $4.50 on the minibar list, but drinking it may also generate a restocking charge.

If you favor a certain hotel brand, such as Marriott or Hilton, don’t be surprised if fees and surcharges vary from one property location to another. Even though the hotels wear the same brand name, they may have different owners who set their own fees. You could stay at a Marriott on the east side of Manhattan one night, then at a Marriott near LaGuardia Airport the next night and find different surcharges when you check out.

Not all high-end properties tack on extra fees. At the Chateau Beaver Creek in Colorado, everything is included in the room rate, even tipping. At Red Carnation’s Milestone Hotel in London, booking the “best available rate” includes unlimited WiFi, use of the health club, welcome drinks, a newspaper and more, according to Andrew Pike, the property’s general manager. The only add-on fee is for parking.

You’ll find a few cases where a brand offers a perk worldwide. A spokesperson for the InterContinental Hotels Group notes, “As part of the re-brand of our loyalty program, IHG Rewards Club, last year, we announced free Internet for all IHG Rewards Club members across our network of over 4,600 hotels and resorts from 2014. This means our 77 million members can benefit from free Internet in any IHG hotel they go to, whether they stay the night or just come in for a coffee or an impromptu meeting.”

The best chance for avoiding extra fees is at the mid-priced hotel chains, such as Marriott’s Residence Inns and IHG’s Holiday Inn Express. On their websites, you’ll see what’s included in the room rate: free WiFi and breakfast. Some of the Holiday Inn Express properties in North America even offer free local and toll-free calls.

Resort fees madden many travelers who question whether it’s just another way to grab your money. It may depend upon what’s included in the resort fee. If the fee includes use of the gym, morning coffee and a newspaper and you aren’t going to work out, don’t drink coffee and don’t want a paper, you probably feel you’re being overcharged.

The resort fee might actually be worth what you’re paying at certain properties. For example, expect a $40-a-night parking charge if you have a car at some hotels in Vail, Colo. At the RockResorts properties in this ski town, however, the Vail Resorts Hospitality resort fee covers parking and more. The posh Arrabelle, for example, charges a $30 resort fee per night which covers valet parking, Internet access, fitness center access, in-town transportation, newspapers, local phone calls, business center use, in-room bottled water upon arrival, lobby coffee/hot chocolate, postcard mailing and Rocky Mountain Sunscreen.

The popular phrase “know before you go” applies when booking a hotel room or suite anywhere in the world. If you are booking on the hotel’s website, read the fine print before making the reservation. Once you’ve booked, it’s vital to read your confirmation carefully and see what extra fees might be listed. If you are booking on one of the discount websites, take a look at the website’s policies. Hotwire has a Rates and Pricing page that reads in part: “Please note that each hotel may also have its own charges — for example, parking, resort fees, convention fees and energy charges. You will be required to pay any such fees directly to the hotel (usually at check-out time). Once you book a hotel reservation, we recommend that you contact your hotel directly to inquire about any additional charges.”

If you are booking a room while speaking with a live person on a hotel reservation line, here’s what Hanson suggests: “When making a reservation, after learning the room rate the guest should ask, ‘Are there any automatic fees and surcharges that will be added?’ Often, the reservation agent will list a few. Then the guest should ask, ‘Any others?’ If the reservation agent says ‘No,’ get the person’s name and mark down the date.” With this approach, you’re armed in case there are unexpected charges when you check out. You’ll be able to give the name of the person you spoke to and the date you made the reservation when politely asking for the charge to be taken off your bill. Hanson adds, “This can be a more rational approach, and it leaves room for negotiation. Guests saying, ‘I don’t like it, so I’m not going to pay’ leads to a more difficult discussion.”

UNWELCOME FEES

Bottled water: Don’t open the bottle of water in your room unless a tag indicates it’s free.

Early check-in: If you are able to get into your room early, confirm there won’t be an early check-in fee.

Energy surcharge: Widely introduced in 2000, an energy charge on your bill helps the hotel combat rising energy costs.

In-room safe: Some properties, especially overseas, charge a mandatory fee whether or not you use the safe.

Local tourism taxes: Properties may pass along local tourism taxes and fees for local building projects.

Parking: The cost to park can climb to $40 a day at city and resort hotels. If you choose the valet option, you’re also expected to tip.

Phone reservations: Some properties want you to book online. Excalibur Las Vegas charges $10 to book via phone.

Refrigerator: Some hotels have small, unstocked mini-fridges in guestrooms. Others charge for them. Excalibur Las Vegas charges $25 for a refrigerator.

Room service: Before ordering, ask about service and delivery charges. Some hotels tack on a tray charge.

Spa gratuity: Before tipping the masseuse, ask if a tip will appear on your bill. The Broadmoor in Colorado and other high-end resorts automatically add a gratuity to your spa bill.

Staff gratuities: Housekeepers may be on the low end of the pay scale, so most travelers leave a tip. When making reservations, ask if the hotel adds a service charge to your bill, to be divided among the porter, bell staff and housekeepers.

Telephone: Use your cellphone instead of the guestroom phone unless your hotel offers free local and toll-free calls.

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