CA Senate Bill 478- "Junk fees" bill

[storewanderer]

Finally something comes out of CA that is aimed to help consumers. While this new law won't save consumers any money as businesses will just build these fees into the prices they advertise right from the start, it forces pricing transparency which I think is very important.

"Starting July 1, Senate Bill 478, or the “Consumer Legal Remedies Act: advertisements,” will ban “junk” fees on purchases made across California. This includes additional hidden fees related to online purchases, such as concert tickets or hotel rooms, food delivery and surcharges at restaurants."

Read more at: https://www.sacbee.com/news/california/ ... rylink=cpy

Bill text: https://leginfo.legislature.ca.gov/face ... 20240SB478

What concerns me is how "credit card surcharges" will be impacted by this or IF they will be impacted. I am seeing credit card surcharges at far too many restaurants and even seeing them at some smaller retailers as of late. They are "legal" - and you don't have to pay with a credit card, so maybe those are not considered a "junk fee." I wonder what other new fees these businesses can come up with that they can argue aren't a "junk fee."

[Alpha8472]

Politicians are getting pushed by the California restaurant Association to alter this law.

Often when customers go to restaurants they don't notice the service fees. They will order tons of food. When these prices go up, customers will order less food. These restaurants are barely hanging on. This could lead to more restaurant closures. In cities like San Francisco, it could increase the vacancy rates and then lead to even less people going out for a night of dinner and shopping. It is a death spiral.

[veteran+]

My new routine when dining out (besides checking the bathroom before I order) is to ask about fees.

If I do not like the answer I leave.

Also, when using my credit card (I never use debit) at smaller businesses I ask if there is a fee. If there is I will walk away 99% of the time.

I also will not withdraw money from anywhere that charges me a fee.

[J-Man]

It mentions online purchases of hotel rooms. I wonder if it will do away with the super-annoying "resort fees."

[BillyGr]

What concerns me is how "credit card surcharges" will be impacted by this or IF they will be impacted. I am seeing credit card surcharges at far too many restaurants and even seeing them at some smaller retailers as of late. They are "legal" - and you don't have to pay with a credit card, so maybe those are not considered a "junk fee." I wonder what other new fees these businesses can come up with that they can argue aren't a "junk fee."

That one makes sense, simply because (as you note) no one is required to pay with a card, and those who use other payments are not causing these fees to be charged to the business.

Where most other things that they have tried as fees are costs that apply to every person (things like fund for employee costs, as an example).

[storewanderer]

What concerns me is how "credit card surcharges" will be impacted by this or IF they will be impacted. I am seeing credit card surcharges at far too many restaurants and even seeing them at some smaller retailers as of late. They are "legal" - and you don't have to pay with a credit card, so maybe those are not considered a "junk fee." I wonder what other new fees these businesses can come up with that they can argue aren't a "junk fee."

That one makes sense, simply because (as you note) no one is required to pay with a card, and those who use other payments are not causing these fees to be charged to the business.

Where most other things that they have tried as fees are costs that apply to every person (things like fund for employee costs, as an example).

They can get really creative. I expect "to go" fees to become more common in restaurants. In reality they should give you a "to go" discount since you aren't using their space/labor.. like other countries... but whatever. Perhaps hotels can start with "extra person" fees if you go beyond one occupant in the room. Fee happy businesses are great at inventing fees.

[HCal]

I think this law will save consumers money, as price transparency promotes competition in the marketplace, which tends to lower prices.

Credit card fees are not affected, as they are optional and easily avoided.

It will be interesting to see what happens with resort/ticket fees. Will websites that advertise to California consumers have to comply even if the hotel or venue is located elsewhere? If so, I imagine they will simply change how the price is displayed, and leave the fees in place but show an all-inclusive total from the beginning.

[rwsandiego]

...They can get really creative. I expect "to go" fees to become more common in restaurants. In reality they should give you a "to go" discount since you aren't using their space/labor.. like other countries... but whatever. Perhaps hotels can start with "extra person" fees if you go beyond one occupant in the room. Fee happy businesses are great at inventing fees.

In the not-that-distant past, "to go" prices were often higher than the "for here" prices at restaurants. I agree with you that "to go" should be less expensive, for the reasons you mentioned. It's exactly why I think airlines should charge for carry-on instead of checked luggage. Carry-on makes boarding/deplaning take longer and ties up flight attendants' time.

I hope the "resort fee" and its cousin the "urban amenities fee" (which typically does not include parking) go the way of the dinosaur. I get the parking fee, although it is often outrageous. Sure, at a large downtown hotel with a relatively small garage that is well-maintained, well-lit, and safe a fee is justified. However, at a Courtyard or Comfort Inn that caters to drivers and has a parking lot the fee is ridiculous.

[jamcool]

“To-go” requires packaging, which costs more nowadays, especially because foam containers are verboten in many areas of the country. Dine in requires none of that packaging.
As to “checked luggage”, certain items “disappear” from checked luggage frequently as it is checked-like electronic devices. Also the problem of access to medications if you need them and they are in your suitcase.

[ClownLoach]

Credit card surcharges were never supposed to be allowed in the first place, I am unsure how they became so prevalent.

My understanding is all the restaurant surcharges and percentages must go away, any cost that is added on after the menu price other than tax. Along with fees on tickets, which can be seen already in drastic price increases for sporting events... I had season tickets for hockey and the price has doubled for next season, and they stated this law is the reason why. The season tickets would not have the usual fees applied, but now they had to raise the price to offset fee loss which basically eliminates most of the discount for buying the whole season. Contrary to popular belief apparently some of those Ticketmaster fees were going to the venue, artist or team. Many people upset about this as the fees on single tickets were subsidizing season tickets, and season ticket holders are the most productive and profitable attendees of sporting events.

Food delivery is going to get the same problem. So let's say your 3rd party delivery service was charging $5.99 to deliver plus tip but now they can't, then they're going to have to increase the price of the meal somehow. Where these services are tightly integrated such as the pizza places that subbed out delivery directly to them and eliminated their own drivers they will have to raise the menu price.

The problem, which is why everyone is having a debate here, is that the fees are so prevalent and continuing to change names and purposes that it is going to be very difficult to enforce. So for example the resort fee won't be allowed, but they're going to cook up something similar with a more specific name that is unavoidable like clean linens fee or something else. I totally expect packaging fees for takeout. So if they can keep changing the names of the fees they will probably be able to outrun the bill.