Fees For All

Fees For All

By JUDY JACOBS

Hotel fees are on the rise. And they’re likely to keep going up.

Rising occupancy rates have prompted hotels to collect more fees, primarily because more guests equal more monies collected, but also because properties have tried introducing new charges. Though they’ve been around for years, meeting planners and attendees still get sticker shock when they see these unexpected costs, with costs tied to everything from setting up meeting rooms and bellman service to delivering packages and master folio billing.

This year, U.S. hotels expected to collect an estimated $1.8 billion fees and surcharges from guests, an increase of nearly six percent over last year, according to a new study conducted by Bjorn Hanson, divisional dean, clinical professor, of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at NYU School of Continuing and Professional Studies.

An increase in occupancy was what brought in most of the additional fees, Hanson notes, and numbers are expected to spike next year. “Occupancy has been 60 percent, so the industry has been reluctant to add a lot more fees this year, but they have launched some, and next year as occupancy increases we’ll likely see more new fees introduced, and at higher amounts.”

UNWELCOME SURPRISE
Some of these fees surprise even seasoned meeting planners, who struggle with finding the best ways to deal with them.

“We’re seeing more and more hotels charging a plug-in fee. If you use any electrical units in a hotel meeting room, you’re going to be charged,” says Joan Eisenstodt, chief strategist of Eisenstodt Associates in Washington, D.C. “I get it--the cost of energy is going up. But at the same time, am I going to start seeing charges for glasses of water at meals? I think we are because of water shortages. It’s being done already in Atlanta.”

The electricity plug-in fee is just one of many new charges that planners are encountering. “I now have to budget for the maid service, the bellman, a reset room fee, things I never saw before,” says Maha Hermes, manager, medical conferences and events for Questcor Pharmaceuticals in Hayward, Calif. “The hotels are getting booked so they can ask for these things. But [the fees] can add up to $20 more per day for each room. I wish they’d just include it in the room charge, so we don’t have to see it.”      Read More...

Where Do Fees Come From?

Fees and surcharges emerged as an industry practice in about 1997 with resort fees and have increased every year, Hanson said, except for periods following 2001 and 2008 when lodging demand declined. Energy surcharges were introduced in 2000.

Hotels have found numerous fees to tack onto meeting planners’ bills. Among these are increased charges for bartenders, service, and other staff at events; charges for set up and breakdown of meeting rooms; charges for meeting rooms in which meals are served (usually there is a charge for meeting rooms but not an additional room charge for rooms in which meals are served, and at one time even meeting room rental was free with enough guest rooms booked); fees for master folio billing and baggage holding fees for guests leaving luggage with bell staff after checking out of a hotel but before departure.