HELENA - Tourists and business travelers may be in for a surprise as some Montana hotels and motels recently began imposing energy surcharges of up to $3 per night on the customers' bills to help pay for rising energy costs.
The Billings Hotel and Convention Center became Montana's first lodging establishment to impose an energy surcharge three weeks ago when it added a $2.75 per room fee, according to Ron Muri, part-owner.
"Two dollars and seventy five cents a room doesn't even cover our increase in energy costs," Muri said. "If we tried to cover it out of profits, we'd be out of business."
He said the hotel's monthly utility bill had been about $25,000 a month in natural gas and electricity, but it has soared to $40,000 to $45,000 in each of the last three months.
"The reaction of customers has been disappointment but understanding," he said.
In Missoula, the Doubletree Hotel has tacked on a $3 surcharge, while the WestCoast Kalispell Center Hotel in Kalispell has added $2.60.
General managers from some hotels imposing surcharges didn't return calls.
Not all hotels have slapped on the extra fee.
"We've not looked at it," said David O'Connor, general manager of Best Western Buck's T-4 in Big Sky. "I just don't think it's a good idea. If you need the extra money, raise your rates."
However, O'Connor said utility rates have been "oppressive to say the least." He said Buck's has faced huge increases in its electricity and propane rates.
Marti Bara, general manager of the Days Inn of Helena, said the decision is left to individual hotels in the chain, although the company prefers no surcharge.
"We are not doing it," she said. "I just don't see how it's going to be acceptable as an acceptable charge. Rates are already up."
Matthew Cohn, director of Travel Montana, predicted the surcharges won't hurt tourism in the state.
"(Hotel) people have two ways to deal with it," he said. "Some will change their rates. Some want customers to know the reason. It's happening nationwide."
Stuart Doggett, executive director of the Montana Innkeepers Association, didn't have an exact count of how many hotels and motels in the state have put on energy surcharges, but he said it's more likely to be at the larger facilities and franchise facilities.
While the energy surcharges may be new to Montana, he said these add-on charges were launched earlier this year in California and about 30 other states facing steep energy price increases.
"I just know that our members talked about significant increases in energy costs," he said. "This is a way to help them cover their costs so they can continue to provide services for travelers."
About 150 Montana hotels and motels have been buying their electricity at deregulated rates through the association for the past several years and are locked in at Montana Power's current rate until mid-2002. After that, rates are expected to rise substantially.
But they have experienced substantial increases in their natural gas rates. The group of motels and hotels were natural gas customers of Montana Power Trading and Marketing, which was sold to Pan-Canadian in December. The lodging establishments were told in January that Pan-Canadian would no longer serve them. As a result, Energy West took over serving this group of customers, which have had to pay market rates for natural gas and those rates have quadrupled costs, according to Con Malee of Energy West, who is working with the Montana Innkeepers Association on utility matters.
Malee said he has been advocating that hotels and motels begin imposing energy surcharges on their bills.
"It's a way of getting the customer to see the price signal," he said. "Two or three dollars a night I don't think is intolerable."
"These folks are in the hospitality industry, and of all industries, you don't turn your heat or the air conditioning off or the lights down," Malee added. "These people are into creature comforts."
State government officials have taken the position that they won't reimburse employees for the surcharge when they travel and stay in Montana hotels and motels.
"We are not going to support paying a surcharge," said Cathy Muri, administrator of the Department of Administration's Accounting and Management Support Division. "We feel that energy, heat, light and water should be part of the room charge."