SPRINGFIELD, Ill. (WCIA) – If you’ve ever booked a hotel room or bought concert tickets, you might have been surprised to find the amount you had to pay at the end was more than you expected because of those additional charges tacked on at checkout.
These are considered so-called “junk fees” – labeled as processing or service fees you don’t see until it’s time to pay. According to the Consumer Financial Protection Bureau, these fees cost an average family of four $3,200 a year.
“We don’t know that we’re paying for that, we don’t know that it’s going to be tacked on,” State Rep. Bob Morgan (D-Deerfield) said. “It’s not a tax. It’s just an extra fee, so it really is deceptive.”
A bill in the Capitol would ban those fees. Instead, consumers would pay the advertised price for the item or service. The proposal passed out of the House Thursday and is now in the Senate for further consideration.
“This is going to help consumers because when we put the pricing up front, consumers can make the choice that’s right for them,” Morgan said.
Morgan along with other state officials took their push to the White House this week meeting with other state officials and advocates wanting the same thing.
“We’re all speaking from the same page, making sure that the industries out there that are charging these fees have better get in line, because we’re going to make sure by rule or law that these kinds of practices stop,” Morgan said.
There have also been efforts at the federal level for this. In October, the Federal Trade Commission (FTC) announced a proposed rule change to ban businesses from using junk fees.
“But a lot of times at the federal level, it takes a long time,” Anna Aurilio, the senior campaigns director at the Economic Security Project, said. “And that’s why we were really happy to be there with representatives from four different states that are working on state level junk fee legislation because we think, number one, states know what the experiences of their own citizens [are], they’re much closer, and number two, they can act much more quickly.”
Groups representing businesses like the Illinois Chamber of Commerce oppose the bill and say getting rid of these fees could end up driving up costs for consumers.
“Because nobody’s making the operating costs for a particular business go down, everything’s going upwards,” Lou Sandoval, the president and CEO of the organization, said. “So in order to be able to cover your cost of doing business, you’re just going to increase your base unit cost to cover those fees.”
If the bill becomes law, the attorney general would be tasked with enforcing violations under the Consumer Fraud and Deceptive Business Practices Act.
