The issue at the center of the settlement agreements between several hotel companies and Pennsylvania's attorney general is transparency.
The state has reached separate settlement agreements with Omni Hotels & Resorts and Choice Hotels International in recent months and with Marriott International in 2021 over their disclosure practices for fees, including resort fees.
In an interview for the Hotel News Now podcast, Mark Adams, partner at law firm Jeffer Mangels Butler & Mitchell, said the attorney general's main objective with these agreements was to make sure there's full, upfront disclosure by a hotel if there's a mandatory fee.
While these agreements apply to hotels operating in Pennsylvania, he said these companies will look to expand their transparency practices across their portfolios. Other states, and even the federal government, are exploring their options for taking on fee transparency as well. Two bills are making their way through Congress with some momentum: the Hotel Advertising Transparency Act of 2022 and the Hotel Fees Transparency Act.
"I am confident that those will find their way to [President Biden's] desk, and he will sign them," Adams said. "And once he signs them, there will be much publication about it, and I think state legislatures will follow up."
The effect of these changes will be mutifaceted, and it could be good for both consumers and hoteliers, he said. Guests would have more clarity over the cost of their stay before going through the booking process. If disclosure becomes an industry-wide practice, no one would have the competitive advantage of initially appearing to have a lower room rate.
"It was a competitive disadvantage to do it voluntarily upfront because you would clearly kill your business because you couldn't advertise the same rates," he said. "But if everybody has to do it, then all boats rise together."
For more insights from Mark Adams, listen to the podcast above.