Juan Chavez handles baggage as it comes off a United Airlines aircraft at George Bush Intercontinental Airport in Houston.
Brett Coomer/Houston Chronicle via AP
Annoying “junk” fees added to your purchases are the target of proposed legislation in Springfield, and mirrors a national campaign to rein in surprise charges and increase transparency in pricing.
The legislation, by state Rep. Bob Morgan, D-Deerfield, and state Sen. Omar Aquino, D-Chicago, would mandate upfront disclosures of the total price of goods or services for a wide range of industries from entertainment to housing. It would also give the attorney general’s office more power to go after companies that add surprise fees.
A hearing is expected to be held Tuesday before the Illinois House Consumer Protection Committee.
The goal is to prevent the fees — sometimes called convenience or processing fees — from popping up only when a customer is ready to check out and make it easier for consumers to compare prices while shopping.
“Anyone who’s bought concert tickets can relate to that,” Morgan said.
He said businesses would still be free to charge whatever fee they need to — as long as they breakdown the total cost, including fees, for consumers in advance.
“It’s just squeezing people in a way that’s deceptive,” he said. “This is across a number of industries.”
Illinois Attorney General Kwame Raoul supports the legislation, saying in a statement that junk fees are responsible for “decreasing trust in the marketplace and putting honest businesses at a disadvantage.”
It’s also backed by the Economic Security Illinois, a local affiliate of the national nonprofit Economic Security Project, and the American Economic Liberties Project, another progressive nonprofit.
The legislation dovetails with President Joe Biden’s effort to curtail junk fees. Such surprise fees cost Americans “tens of billions of dollars per year,” according to the Federal Trade Commission.
Biden mentioned the fees Thursday in his State of the Union speech, pointing to his administration’s recent regulation limiting credit card late fees to $8.
“The credit card companies don’t like it. But I’m saving American families $20 billion a year with all of the junk fees I’m eliminating,” he said.
Such fees have long been an annoyance to consumers, who routinely encounter surprise fees at the end of ticket purchases, travel bookings and even restaurant meals.
In January, the Chicago Sun-Times reported on the surprise fees often encountered by prospective tenants.
Such apartment fees — for everything from submitting an application and getting a credit check, moving in or out, or being able to access a payment portal or repair hotline — can add hundreds of dollars to a person’s monthly rent, experts say.
But because they’re often not disclosed up front, the fees can make it hard for apartment hunters to do comparison shopping.
Ameya Pawar, senior adviser at the Economic Security Project and former Chicago alderman, said transparency helps honest businesses compete.
“What it does is create a level playing field,” Pawar said.
Other states are also taking action. California last year enacted a ban on junk fees that takes effect in July. Like the Illinois proposal, the law will make it illegal to offer a price for a good or service that does not include all mandatory fees and charges other than taxes or fees imposed by the government.
Bills have been introduced in New York, Arizona, Virginia, Hawaii, Alaska, Rhode Island, Pennsylvania, North Carolina, Colorado, Connecticut and Minnesota.