Junk fees: How Mamdani's new city ban will help Long Islanders avoid bait-and-switch pricing

A Hamptons resort that welcomes New York City residents who summer out east. A Long Island couple celebrating the renewal of their wedding vows with a weekend at a posh Williamsburg hotel. A Long Island-to-Manhattan commuter on her lunch break booking the family trip to wherever.

All are examples of how Mayor Zohran Mamdani’s latest anti-junk fee crusade could trickle out to Long Island and shield Long Islanders from bait-and-switch pricing. The city's effort is being championed by a consumer-protection czar Mamdani hired, an official who did similar work during former President Joe Biden's administration and his onetime acting labor secretary.

"These fees go by many different names: destination fees, resort fees, hospitality service fees. Whatever you call them, they are slippery, they are elusive, and ultimately — quite simply — these junk fees that hotels and booking sites sneakily impose," Mamdani said last month.

Under the rule, first proposed under former Mayor Eric Adams but not enacted, the total cost must be disclosed upfront, exclusive of taxes; the policies for any deposit or credit card hold also must be disclosed.

The travel junk-fee ban, which goes into effect Feb. 21, is just one tentacle of Mamdani's efforts to address pesky fees consumers have long hated. His Jan. 5 executive orders target gyms that make canceling intentionally difficult, concert ticketers that add on fees, and what he calls "subscription trips and traps" that make consumers keep paying and paying.

Charles Gardner, who was Suffolk County’s consumer affairs commissioner from 1996 to 2008, said of what Mamdani is doing, "It can only help."

"It’s definitely gonna benefit everyone who lives in the metropolitan area," he said.

What Mamdani is doing will cover anyone who is in New York City, as are roughly 315,000 Long Islanders who regularly commute somewhere to the five boroughs for work.

A 2018 analysis found that U.S. consumers paid lodging companies a record $2.93 billion in junk fees such as "resort fees" and related charges. Overall, junk fees of all categories totaled $65 billion, according to a White House announcement by the Biden administration that President Donald Trump's administration removed from the web.

Some of what Mamdani is doing parallels Biden-era federal rules that aren’t being enforced by the Trump administration, according to Sam Levine, the Department of Consumer and Worker Protection commissioner under Mamdani.

Vijay Dandapani, head of the Hotel Association of New York, a lobbying group representing hundreds of New York City's biggest hotels, told Newsday that his group supports the rules.

"I wouldn't go so far as to say happy," he said. "We are comfortable with what DCWP laid out."

Spencer Dobkin, a spokesman for the U.S. Travel Association, said his organization hasn't taken a position on Mamdani's rule.

The libertarian Cato Institute, writing in 2023 about Biden's junk-fee rules, said that while no one should be misled, regulations are unnecessary, as sufficient information is available online to allow would-be travelers to comparison-shop if they want to.

"Yes, some ill-informed customers would avoid making transactions they’d regret, but price comparison websites and online travel agents increasingly help here anyway," the institute wrote.

The Trump administration did not return a message seeking comment.

New York City will be proactively policing violations, and consumers can file a complaint with the city’s DCWP, where a team of government lawyers are examining violations for patterns and mediators are available to advocate on behalf of a wronged consumer.

"When someone files a complaint, it is brought in, and a mediator tries to address it," said Melissa Iachan, the department’s deputy general counsel. "The mediator would contact either the booking site or the hotel and say, ‘Look, there’s a consumer who booked this here in New York, and they were forced to pay this fee, which is unlawful; give them their money back,’ ” she said.

Experts predicted a domino effect in which the effect of Mamdani's new rules could spread far beyond New York City.

There’s a real cost to businesses operating multiple pricing schemes simultaneously. And what happens in one place can inspire neighboring jurisdictions.

Vicki G. Morwitz, a professor at Columbia Business School who has done research on junk fees, pointed to what happened in Quebec — and then throughout Canada — when that city first outlawed drip pricing, a deceptive practice in which a seller advertises a lower base price for a service or product, and then adds, or "drips," hidden fees along as the buyer reaches checkout.

"Canada’s now outlawed drip pricing. But before they did that, Quebec had outlawed drip pricing, but the rest of the country hadn’t," Morwitz said. "And for many companies, it just wasn’t worth it for them to price differently in Quebec versus the rest of the country."

In the New York City metro area, adjacent jurisdictions take note about what’s happening, get ideas, and sometimes collaborate, said Gardner, the former Suffolk consumer affairs commissioner.

"Most of the consumer protection agencies work together, and they’re aware of what’s going on at other jurisdictions," he said.

As for the rules New York City is adopting later this month, Gardner said: "Whether you call it junk fees or add-ons or whatever — not only if you book a room or a resort, really, if you buy anything, if there’s other fees involved, they should be disclosed at the time of purchase, period, just should be, full disclosure."

Joshua Ronen, a professor at NYU Stern School of Business, predicted that beyond the city, "the rest of the country will need to emulate New York because of complaints by their constituents, to the effect of, ‘Why don’t we get the same benefit as New York customers?’ ”

Amit Bhattacharjee, an associate professor of marketing at the University of Colorado Boulder, distinguishes between unbundled pricing in businesses like discount airlines — not everyone cares about getting a meal aboard the plane if they can keep the base ticket price low — and deceptive marketing practices where fees are concealed or not readily disclosed.

"Everyone has limited time," he said, adding that the fees aren't transparent, add to costs and increase the chance for people to make wrong or regrettable decisions in travel plans. "They can’t just shop around for a hotel for hours and hours and hours, and at some point, you have to just call it."

By Matthew Chayes

matthew.chayes@newsday.comchayesmatthew

Matthew Chayes, a Newsday reporter since 2007, covers New York City.