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California Drops the Hammer on Hidden Fees

7 things meeting professionals need to know about the Golden State’s new “Honest Pricing Law” that goes into effect on July 1.

While Congress works on passing the Junk Fee Prevention Act for the whole country, California isn’t waiting around.

The Golden State’s “Honest Pricing Law” or “Hidden Fees Statute,” SB 478, goes into effect July 1, making it illegal for businesses to advertise or list a price for goods or services that doesn’t include all mandatory fees or charges.

Meeting professionals will appreciate the law’s effect on how hotel pricing is displayed. Sometimes called resort fees, amenity fees, destination fees, urban fees, or facility fees, many hotels currently tack on per-night charges—typically ranging from $25 to $60—that aren’t part of the room rate.

While event hosts may be able to lower or eliminate these fees during the hotel-contracting process—or, at least, prevent any new or increased fees after the contract is signed—challenges remain. For instance, attendees and exhibitors shopping around for a hotel room may be enticed by low room rates at hotels outside the block when fees are not transparent.

Here are 7 things planners need to know about California’s Honest Pricing Law:

• The law does not limit what a business can charge; it simply requires that all mandatory fees are included in the advertised price.

• In addition to “resort fees,” which may cover such expected services as pool towels and gym access, hotel fees that must be disclosed in the booking process include those for early/late check-in and in-room Wi-Fi.

• Optional services or fees do not have to be included in the advertised price. For example, the hotel may charge for snorkeling equipment, but because it’s not a mandatory charge, it doesn’t need to be disclosed at booking.

• Taxes do not have to be included in the advertised price.

• The law does not affect tips or gratuities since they are not mandatory.

• The new law also affects restaurants, which are increasingly tacking on unwelcome fees when diners get the bill. If an establishment charges for splitting the bill, employee healthcare, or paying with a credit card, for example, these fees must be disclosed upfront.

• Fees for food delivery ordered from a restaurant do not need to be included in the advertised price of the food because they are part of a separate service. However, the advertised price of delivery must be complete, with no hidden fees presented at time of delivery.

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