ENERGY SURCHARGES HEAT UP

Energy costs continue to heat up — some hotels are experiencing up to an 80 percent increase in energy costs, according to Kathy Shepard, vice president, corporate communications with Hilton Hotels Corp. in Beverly Hills, Calif. That hurts.

It hurts so much that, at press time, major chains like Hilton, Starwood, Marriott, Hyatt, and Wyndham had added surcharges ranging from $2.50 to $6 to help them cope with what everyone hopes will be a temporary surge in energy costs. While the surcharges began in California, which is taking a huge hit economically due to energy deregulation, it since has spread throughout the United States.

Lynne Tiras, CMP, president of independent meeting planner firm International Meeting Managers Inc., Houston, says, “This surcharge is an insult to the intelligence of most meeting professionals and others in the industry.”

Roger Conner, vice president, communications, Marriott International in Washington, D.C., says, “We're not anxious to institute anything that involves nickel-and-diming the customer. What we're saying is that our energy costs are spiraling upward, and we're being very honest and fair in identifying what the surcharge is. As soon as the need for it is gone, the surcharge will be gone.”

Now four class-action lawsuits have been filed by San Francisco law firm Lieff, Cabraser, Heimann & Bernstein against Hilton, Hyatt, Marriott, and Starwood for having “repeatedly breached their contracts with customers and committed unfair and deceptive business practices by imposing energy surcharges above and beyond the basic room rates that customers are quoted when they make their reservations.” Results of the litigation are pending at press time.

In the meantime, what can you do? James Goldberg, a partner with Goldberg & Associates PLLC, Washington, D.C., advises planners to talk with someone in a decision-making position, like a director of sales or general manager, and tell them you won't pay it.

“If the hotel says, ‘Our system won't allow us to delete the charge,’ say, ‘Fine. Reduce the room rate by the same amount,’” says Goldberg. Energy surcharges are no different from any other kind of fee from a legal standpoint, he says, adding that anyone who has contracted a meeting in the near future ought to ask if the hotel has imposed an energy surcharge on attendees. “If the answer is ‘yes,’ the planner should say, ‘Think again.’”