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Caesars to start charging resort fees, says guests demanding them

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Sam Morris / Las Vegas Sun

Showgirls from Jubilee! march up the Strip during a publicity stunt to draw attention to Caesars Entertainment’s policy of not charging resort fees Thursday, July 21, 2011.

Updated Thursday, Feb. 21, 2013 | 5:20 p.m.

After years of marketing "no resort fees," Caesars Entertainment will start charging the fees at its Las Vegas hotels.

Caesars will begin adding fees ranging from $10-$25 on March 1, covering charges for amenities including Wi-Fi, local calls and fitness centers. Caesars operates nine hotels in Las Vegas, including Caesars Palace, Harrah's, Bally's, the Flamingo, the Quad, Paris Las Vegas and Planet Hollywood on the Strip.

It's something guests asked for, said Gary Thompson, the company's director of corporate communications.

Until now, Caesars had charged separately for such amenities, instead of tacking on resort fees, which have upset some hotel customers in the past. Now, it seems, the company is hearing otherwise.

"This is in response to the increasing demand from our guests to provide a package price instead of the inconvenience of separate fees," Thompson said in a statement today. "We continue to do all we can to provide our guests with the best value, best products and best experiences in Las Vegas."

Most visitors to Las Vegas do not pick hotels based on whether they charge a resort fee, according to a recent survey conducted by the William F. Harrah College of Hotel Administration at UNLV.

In a survey of more than 200 people on the Strip, 88 percent said they did not pick a hotel based on resort fees.

"They stayed where they wanted to stay, regardless of the resort fee," said Toni Repetti, an assistant professor at the hotel college.

But that doesn't mean hotel guest prefer the fees. Only 30 percent of those surveyed said they valued the amenities they were paying for through the fees. More than half said they'd rather pay what they used separately, as Caesars had been doing. Still, they pay them.

"They didn't value the items that came with the resort fee but it didn't change their decision on where to stay," Repetti said. "The attitude was we know we have to pay it, so we might as well suck it up."

The value of the resort fee comes in the bottom line of the hotels, where resort fees generate profits of 80 to 90 percent over the cost of the amenities provided, according to a report from NYU, where the Preston Robert Tisch Center for Hospitality, Tourism, and Sports Management tracks national trends.

The fees are in line with those charged elsewhere in Las Vegas, Thompson said. Hotels run by MGM Resorts International, Station Casinos, the Palms and Boyd Gaming all have charged resort fees for years. They range from $4.99 to $25, according to Vegas.com, an online hotel booking site and a sister website to VEGAS INC and the Sun.

Station Casinos began charging resort fees in 2004. MGM added them in 2008. The Caesars company, when it was going by its former name, Harrah's Entertainment, launched its "no resort fees" campaign in 2010, trying to cash in on visitors upset by the extra charges. Some guests said they were caught off guard by extra fees on top of their room rates.

The company started a "no resort fees" Facebook page, which drew tens of thousands of followers. In 2011, the company held rallies parading showgirls from the Jubilee show at Bally's down the Strip with signs reading "Just Say No to Resort Fees!" and "Our Money, Our Choice!" They wrapped casinos with ads about their lack of resort fees charged by other casinos. At the time, the company claimed it had saved Las Vegas visitors $37 million a year by not charging the fees.

But times change.

"Based on the current industry standards in the market and evaluation of the services our guests choose and use, a comprehensive package of bundled services and amenities proves to be the best and most meaningful value to our guests," Thompson said.

Most customers, when faced with the fees, would rather see them wrapped into the room rates, instead of broken out as a separate fee. In a separate, nationwide survey conducted by UNLV, 67 percent said they preferred higher room rates over being charged another fee.

"Las Vegas is one place they break it out, but it really is essentially raising the room rates," Repetti said. "In the nationwide survey there was more acceptance, because in other areas resort fees have been common for years. They just haven't been around for as long."

Resort fees have been rising, and more hotels adding them, across the U.S. during the past decade. After being introduced in 1997 as an "amenity tariff," such fees have increased in 10 of the past 13 years, according to the NYU report. The industry set a record for resort fees in $1.85 billion in 2011, and NYU predicts when last year is tallied, the lodging industry will eclipse that at about $1.95 billion.

Nearly three dozen hotels across the valley still do not charge resort fees, including most downtown hotels, the M Resort, the two Arizona Charlie's casinos, the Cannery casinos, Terrible's Hotel & Casino and the LVH.

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