In fact, 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, chains including Hilton, Starwood, Marriott, and Hyatt had added surcharges to help them cope with what everyone hopes will be a temporary surge in energy costs. While Marriott only had energy surcharges in its California properties at press time, “We anticipate some additional surcharges in other markets this summer,” said Roger Conner, vice president, communications, Marriott International. Hilton instituted a surcharge in March at its owned and managed properties in California but within a month expanded the policy to include several other markets on an as-needed basis.
“In extreme cases, I can see where some form of relief is needed, and I can sympathize with the hotels' dilemma,” said Jalene Bowersmith, program manager with Washington, D.C. — based International Policy Council on Agriculture, Food and Trade. Still, she doesn't feel that surcharges are a legitimate way for hotels to deal with rising energy costs. “I have never seen a hotel give an energy discount,” she says. “Why not? Because it's all part of the cost of doing business.”
And not all hoteliers are doing it. Scott DeBerg, senior sales manager with Abbey Group Resorts in Lake Geneva, Wis., said, “Our resorts are basically eating the much higher energy costs.”
Conner insists hotels are not nickel-and-diming customers. “We're saying 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.”
In the meantime, what can you do? Debbi Boyne, CMP, annual meeting programs & logistics manager, Society of Exploration Geophysicists, Tulsa, Okla., fought the surcharge — and won.
“I received a letter from a hotel in Newport Beach explaining that, due to the increased cost of energy in California, there would be a $2.50 per room per night charge. I simply sent a letter back saying that my association also experienced increased energy costs this winter in the state of Oklahoma. Because we have a contracted rate, we do not accept their intention to place a surcharge on our room rate.”
James Goldberg, a partner with Goldberg & Associates PLLC, Washington, D.C., would say that's just fine. “I put energy surcharges in the same category as resort fees and coffee fees.” He says planners can add two provisions to their contracts to prevent being faced with future surcharges: a provision stating that no fees will be incurred unless they are disclosed to and agreed upon by the planner, and a provision saying that the hotels will not apply any policies to the meeting that haven't been disclosed to and agreed upon by the planner.
The first should cover the full range of fees a hotel might apply. The second, he says, will help you avoid “policy statements that contain those little gems that end up costing you money.”
Editor's note: In mid-May, four energy surcharge-related class action lawsuits were filed in California against Hilton Hotels Corp., Hyatt Corp., Starwood Hotels and Resorts, and Marriott International. The lawsuits ask that the hotel chains stop imposing the surcharges and make full restitution plus damages. The hotels are obligated to provide a response. Stay tuned.