As Resort Fees Rise, ASTA Presses for Transparency

Caesars Entertainment Corp. announced they are raising Las Vegas hotel resort fees, at a time when Congress and attorneys general are looking to use legislation and the courts to regulate these charges.

The nightly fee at the company’s Caesars Palace and Nobu Las Vegas will increase to $45 a night plus tax on Oct. 15; with tax, the new fee is $51.02. At the same time, the Rio All-Suite Hotel & Casino, a more moderately priced hotel off the Las Vegas Strip, is increasing its resort fee to nearly $40 a night.

The company said the new fee levels bring their hotels “in line with relevant competitors. Earlier this year, MGM Resorts raised fees at Bellagio, Vdara, and Aria to $45 plus tax. The Wynn and Encore casino resorts also hiked their resort fees this year.

The company said The Caesars Entertainment resort fee hikes come even after CEO Tony Rodio expressed concern about the levels resort fees are reaching, and their potential impact on customer reservations. At the company’s August quarterly earnings call, Rodio said the company needed to be “a little bit cautious about” about future increases.

“I want us to be very judicious and … cautious about taking those rates any further,’ he told analysts, though Rodio admitted that the fees have a strong impact on the company’s profits. Resort fees are a “revenue stream that’s hard to walk away from,” he said.

ASTA supports transparency bill
Concerned about the transparency of resort fees, on Wednesday, the American Society of Travel Advisors (ASTA) sent a letter to two key members of Congress, expressing support for the Hotel Advertising Transparency Act of 2019 (H.R. 4489).

In a letter to Representatives Eddie Bernice Johnson (D-TX 30th District) and Jeff Fortenberry (R-NE 1st District), Eben Peck, ASTA executive vice president, advocacy, said, “We believe hidden hotel resort fees” violate the principles of transparency, “and that public sentiment is with us (and with you) on this issue.”

Peck said, according to ASTA’s annual “How America Travels” consumer research study, in 2017, 61% of consumers opposed altogether the practice of hotels adding mandatory resort fees atop advertised rates. “As such, we strongly support H.R. 4489, which would ensure that consumers are shown the full pre-tax price of a hotel room while searching and comparing lodging options for their next trip.”

Not only do large hotel companies face challenges on Capitol Hill, but state attorneys general are also pursuing consumer protections in court. In September, Nebraska’s attorney general filed a lawsuit against Hilton for its use of “deceptive” resort fees – two weeks after the District of Columbia attorney general filed a similar lawsuit against Marriott International.