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talking points To bundle or not to bundle Hotels taking a page from major airlines' playbook with move toward resort fees by Richard N. Velotta T CO GU LU ES M T N he world is filled with consumers who favor one product over another. There are Apples and PCs. Cokes and Pepsis. Coxes and CenturyLinks. McDonald'ses and Burger Kings. And, in the tourism world, there are bundlers and unbundlers. The Southern Nevada resort community has taken sides in the debate in the form of resort fees. Last month, another company — the South Point — crossed over from the unbundling side by introducing a $14 daily resort fee for guests. The move follows the biggest shift the city has seen since March 1, when Caesars Entertainment ditched its no-resort-fee marketing ploy to begin charging between $10 and $25 a day at its eight Southern Nevada properties. Representatives of Caesars said the public wanted resort fees. I don't think that came out exactly the way Caesars intended. Nobody asked the company 20130401_VI06_F.indd 6 Some, like Las Vegas-based Allegiant Air and fast-growing Spirit Airlines, embrace the unbundled model and offer a deeply discounted fare, but charge for suitcases, carry-on luggage, preferred seating and onboard snacks and drinks. Southwest Airlines, meanwhile, markets to the bundler crowd, emphasizing that "bags fly free." But the airline also has started to play the fee-charging game to generate additional revenue. The company's Early Bird program, for example, enables customers to cut toward the front of the boarding line for a price. Passengers can buy that privilege for $12.50 (it recently was increased from $10). So where do you stand? Are you a bundler or an unbundler? Deciding that may influence where you stay and how you get there. The common complaint the bundler crowd has is that they dislike being 'nickeled and dimed' and would rather pay one time instead of getting billed for every little thing. Industry's growth has mitigated damage done to state's economy during recession ining always has been committed to fostering a healthy Nevada economy. We have grown as an industry and now contribute more than $417 million in state and local taxes to support essential services such as education and safety. We provide thousands of the state's highest-paying jobs and invest billions to develop new projects. In 2011, mining's share of the taxes paid by all Nevada businesses was $171.4 million. In addition, we paid a $245.8 million mining tax (Net Proceeds of Minerals Tax) — a tax no other Nevada business is required to pay. While most sectors of the economy have seen decreases in tax contribu6 The common complaint the bundler crowd has is that they dislike being "nickeled and dimed" and would rather pay one time instead of getting billed for every little thing. The problem is, in the long run, consumers usually pay more than they would if services were unbundled. Remember, the fees are charged daily. A $14 charge doesn't sound like much, but for a three-day stay, it's an additional $42 on top of the room cost and tax. One way to dodge fees is to check with your company to see if they have a loyalty club. Some companies reduce or eliminate fees for guests who stay frequently at a property. The room fee debate isn't much different than the bundling vs. unbundling argument in airline travel. Most airlines have adopted a fee structure for value-added services. Mining has done its part for Nevada by Tim Crowley M for a new fee. What the company meant is that more guests preferred one fee to cover everything instead of multiple charges on a variety of add-ons. There are now about 32 hotels, including most of the downtown properties, that don't charge a resort fee. Who wins when a company institutes a one-size-fits-all resort fee? In almost every case, it's the resort. Consider what resort fees pay for: in-room Internet access, local and toll-free telephone calls, a daily newspaper, shoe shines, access to a fitness center, airline boarding pass printing, copy and fax machine use, in-room coffee, bottled water and discounts at shops and restaurants on the property. How many of those services do guests actually use? tions, ours have more than doubled in the past three years. Furthermore, our per-employee tax contributions of $24,000 are four times the state average of $6,000. Mining is Nevada's eighthlargest industry but supports a portion of the general fund that is twice our economic footprint. Mining's growth in recent years is a perfect example of how an industry can thrive and support Nevada even during tough economic times. Since the recession ended in June 2009, mining has added 1 out of every 3 jobs in the state. Because modern mining is a highly technical process, we must employ a well-educated workforce to operate advanced technology on the mine site. As a result, mining pays the highest average salaries in the state at more than $87,000, including full benefits. In addition, the industry now supports more than 2,300 Nevada-based businesses through our constantly growing supply chain. Our continued growth requires longterm investment in developing new technologies to extend the life of our mines and to explore for new mineral resources. In 2011, mining's in-state investment to discover new ore bodies and develop new projects totaled more than $1.6 billion. This investment creates jobs, provides economic development to communities and generates sales taxes and induced spending throughout the supply chain. Mining has always been there to work with the governor and Legislature to craft sound policies. We were there in 2011 when mining's taxes increased by $48 million. We were there in 2010 when we helped balance the budget. We were there in 2009 when we agreed to prepay our taxes at the beginning of each fiscal year to assist with cash flow. We were there in 1989 when the rates were raised on the Net Proceeds of Minerals Tax, and we'll be here again in 2013 to help devise solutions to address fiscal issues in a manner that does not inhibit the future prosperity of the state. Tim Crowley is president of the Nevada Mining Association. Mining is Nevada's eighth-largest industry but supports a portion of the general fund that is twice our economic footprint. | 1 APRIL 2013 | 3/28/13 2:52:29 PM