Gavel & Glass Briefing - Hotel and Event Fees: Contracting Considerations for Associations

Managing event costs is an important part of site selection and contract negotiation for associations. Mandatory lodging, meeting, food-and-beverage, technology, and other venue charges can materially affect an event budget. Although the Federal Trade Commission’s rule on unfair or deceptive fees improves price transparency for certain covered lodging transactions, associations should still review proposed hotel and venue agreements, fee schedules, and related documents carefully.

The FTC Rule: Better Price Transparency

The FTC’s Rule on Unfair or Deceptive Fees became effective on May 12, 2025. It applies to covered offers, displays, and advertisements for short-term lodging and live-event tickets. The FTC’s guidance states that the rule also applies to business-to-business transactions.

When a covered business offers, displays, or advertises a price, it generally must clearly and conspicuously disclose the total price, including mandatory fees it knows about and can calculate at that time. The rule also prohibits misrepresentations about a fee’s nature or purpose, its amount, whether it is refundable, or the good or service for which it is charged. 16 C.F.R. §§ 464.2–.3.

The rule is primarily a price-transparency rule. It does not prohibit every resort, destination, service, or similar fee, and it does not replace review of a negotiated event agreement. Certain government charges and optional charges are treated differently from mandatory fees. The FTC’s FAQs provide additional guidance on the rule’s scope and disclosures.

For associations, the practical point is straightforward: the rule may improve visibility into certain mandatory lodging charges at the pricing stage, but it does not eliminate the need to evaluate the full cost structure of a proposed hotel or venue agreement.

Contract Charges That May Affect an Event Budget

The terms and charges in a master agreement vary by venue and transaction. Before signing, associations may wish to determine whether the agreement and related fee schedules clearly address the following areas.

Audiovisual and Technology Services

A venue may require use of an in-house provider, impose conditions or fees for outside vendors, or charge for connections, access to house systems, or on-site technical support. The agreement should identify applicable requirements, charges, and approval processes.

Food-and-Beverage Minimums

Service charges, taxes, and other charges may materially affect the total catering cost. Whether those amounts count toward a stated food-and-beverage minimum depends on the agreement’s terms. Additionally, if an event fails to meet its minimum expenditure, venues typically assess a contractual shortfall penalty. Because the organization remains obligated to pay this baseline amount regardless of consumption, associations should consider monitoring their catering projections closely. If a shortfall appears likely, a practical operational strategy is to simply add menu items to reach the required threshold. Incorporating an extra afternoon coffee break, upgrading a breakfast selection, or extending a reception by an additional hour allows the association to direct those funds toward the attendee experience, rather than surrendering the money as a sunk cost.

Administrative Fees

An administrative fee may be retained by the venue and may not be a gratuity paid to banquet staff. The agreement should identify the fee’s purpose, amount, and treatment.

Meeting-Space Infrastructure

Internet bandwidth, electrical power, rigging, freight handling, labor, security, and other venue services can affect the event’s total cost. Associations may wish to confirm which services are included, which are optional, and how any additional services or charges must be approved.

Improving Cost Visibility

Leverage is generally strongest before an agreement is signed. During the request-for-proposal and contracting process, associations may consider asking the venue to identify anticipated charges, including charges for audiovisual services, internet, power, rigging, labor, and other event infrastructure.

Associations may also consider seeking a clear fee schedule and agreement language identifying which charges are included, which charges are optional, and how additional charges may be approved. The appropriate approach will depend on the event, venue, market conditions, and the association’s priorities.

The FTC’s fee rule provides important price-transparency protections for covered lodging and ticket offers. Associations planning events should still review the complete agreement and related fee schedules to understand how contractual charges may affect the total event budget.

Disclaimer: The information contained in this article is provided for educational and informational purposes only and should not be construed as legal advice on any subject matter. No recipients of content from this article, clients or otherwise, should act or refrain from acting on the basis of any content included in the article without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from an attorney licensed in the recipient's state.