Skift Travel News Blog

Short stories and posts about the daily news happenings around the travel industry.

Hotels

California Takes Aim at Junk Fees: New Law Mandates Upfront Pricing from July 2024

5 months ago

California Governor Gavin Newsom signed into law on October 7 a bill to ban mandatory hidden fees — also called junk fees — starting July 1, 2024.

“The price Californians see will be the price they pay,” said Rob Bonta, the state attorney general.

As Skift previewed, the law broadly requires upfront disclosure of any mandatory fees by hotel companies, online travel agencies, car rental companies, online concert ticket sellers, and others.

If a company doesn’t comply, a consumer could seek “at least $1,000” in damages via the state’s existing consumer protection claims processes. (See the law, embedded below.)

Junk Fee Reform

It’s unclear how California’s new law will impact companies in mid-2024.

California has the largest population of any state in the U.S., and so some big companies choose to apply its requirements nationally.

Yet there could be lawsuits from industry groups, and corporations could find workarounds to keep profitable fees. California has rules on fees for car rentals, but many online travel agencies choose to display those fees in ways that vary depending on jurisdiction.

Another wrinkle: Newsom hasn’t yet taken a position on another bill awaiting his signature, Senate Bill 537. He has until Saturday night to decide whether to let that bill pass into law. The bill would prohibit businesses that sell lodging for up to 30 days in California from displaying a room rate that doesn’t include all fees or charges (except government-imposed taxes) as of July 1, 2024.

It’s possible the Governor may feel the bill he’s signed already covers this, making a law specific to hotels unnecessary. Either way, the state’s 6,000 hotels and thousands of short-term rentals are currently facing new rules about the display of so-called junk fees, such as resort fees and housekeeping fees. 

Here’s the legislation that’s just passed:

Travel Agents

Travel Agents Could Have a Say in New Rules For Passengers

9 months ago

Travel agents could bring a real-world perspective to complex rules shaping the protection of air travel passengers, as part of a modernization proposal for the U.S. Department of Transportation’s (DOT) watchdog for aviation consumer protection.

The Modernization Act (H.R. 3780) would see the Aviation Consumer Protection Advisory Committee (ACPAC) membership include a dedicated travel agency seat to the advisory body. The bipartisan bill was introduced in the U.S. House of Representatives by Reps. Dina Titus (D-NV), Gus Bilirakis (R-FL), John Garamendi (D-CA), Marc Molinaro (R-NY) and Julia Brownley (D-CA) on Thursday, 1 June. 

The five most recent ACPAC meetings, starting in December 2021, have centered around two major DOT regulatory proposals on ticket refunds and transparency in airline fees – crucial to business operations of travel agencies, whatever their final forms take. 

“Roughly half of all airline tickets in the U.S. are sold through the agency channel. Giving these small business owners, 70 percent of whom are women, an elevated voice in the DOT regulatory process will help the Department meet its consumer protection mission,” said Zane Kerby, CEO and president of the American Association of Travel Advisors (ASTA). 

Travel agents provide valuable insights through real-world impacts of complex proposals pending before DOT, currently missing from ACPAC’s process, added Eben Peck, ASTA’s executive vice president.

In its current form, ACPAC membership consists of one representative each of U.S. airlines, consumer groups, airports and state or local governments.