Question of the Day October 21, 2013
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Q:I've recently been hearing about something called a "concession fee" that's been showing up a some Strip restaurants such as Sugar Factory and Senor Frog's. What's the deal?
A:What, indeed? While airlines were piling on the carry-on and baggage fees, the hotel industry started with the "energy surcharge," prior to instituting the notorious and increasingly ubiquitous "resort fee." Having been virtually immune to such developments (with one lone resort fee at the newly remodeled Plaza), this summer downtown further jumped on the bandwagon as the Golden Nugget quietly introduced what it first termed (at least relatively transparently) the "Fremont Street Experience Fee" (levied to offset its contribution to the canopy lightshow), and now more euphemistically dubs the "downtown destination fee." As an aside, the D and Golden Gate quickly followed suite in introducing their own Resort Fees.
As the onward march of itemized and often unavoidable surcharges and "stealth" taxes seems no sign of abating, the restaurant industry has evidently become one of the next to start hitting patrons with extras, at least as far as Las Vegas is concerned.
Witness the so-called "CNF" fee, which first was brought to our attention by a reader more than a year ago, but for which we have consistently received only vague explanation. It's an additional tax added on top of the total bill -- i.e., inclusive of sales tax (yes, a tax on a tax) -- and the first known property to charge it was Sugar Factory American Brasserie at Paris. When we called the venue once again, earlier today, in an effort to get to the bottom of precisely what this fee comprises, both monetarily and otherwise, a typically vague server/receptionist told us it stands for "Concession & Franchise Fee" and that it's because of a charge levied by Paris on them, the tenant, presumably in addition to regular rent, because "we have such a prime location opening direct onto the Strip."
No, this doesn't make any sense to us, either, for a number of reasons:
- Why is your "prime location" my problem? Presumably, you receive additional business as a result, so how come the customer is penalized for you being in a good spot? Doesn't -- or shouldn't -- your rent reflect your prime location already? Why this additional fee, which seems an afterthought, like it was some all-round big surprise that being right on the Strip is a good thing?
- Why is this itemized, and not just amortized into the prices, which would be a lot more palatable way to pass on the fee, if pass it on you must? Why is it charged on top of sales tax? Is that the crux of this, that Paris charges the restaurant some kind of "success" fee, based on sales?
- How come other businesses don't do this?
In terms of the third point here, we called around and spoke with a friendly staffer at Diablo's Cantina at Monte Carlo, which is also located at a "prime location" on the Strip, with walk-in access. They confirmed that you pay only for whatever you order, plus the relevant sales tax -- no hidden extras or surcharges. Likewise Mon Ami Gabi, a sister property at Paris that's also part of an outside franchise. They'd never heard of a "CNF" fee and don't charge one -- the only other tax is an 18 percent gratuity leveled for parties of five or more. Granted, you can't walk in directly off the Strip to Mon Ami Gabi, you do have to pass through the casino, but location doesn't come much "primer" than directly opposite the Bellagio Fountains, right?
That also seems to negate any argument about Caesars Entertainment being a particularly exacting landlord (Monte Carlo is an MRI property), especially since a call to Cabo Wabo Cantina in the (Strip-side) entrance to the Miracle Mile Shops, which is owned by non-casino entity Boulevard Invest LLC, also charges a "CNF" fee. The person who answered the phone at first said that they did not charge any extra fee, but when we pushed it then conceded that they do have a "CNF" addition, but that this is "only a dollar or two." We further inquired whether that's per person or per check. "Oh, it's a few dollars per party," she responded, at which point we demanded she get specific. After a few minutes on hold, we were told "It's three percent per check," before she hung up.
Returning to the Sugar Factory for a moment, we confess that, not being of either a sweet-toothed nor celebrity-spotting inclination, it hasn't been high on our "to try" list. But a perusal of Yelp.com also brings up frequent complaints with regard to this restaurant being "fee happy," shall we say, including customers being charged $2 per glass for tap water, while one lady reported being charged a $25 "cake-cutting" fee for a member of staff serving a brought-in birthday cake for her husband, while others report a $4 "split dish" fee (a not unusual practice, but this place seems to delight in heaping as many fees on as possible).
As to Señor Frog's at Treasure Island, this was the first we heard of any extras here, but a phone call revealed the fee here is levied in lieu of them adding a higher Live Entertainment Tax, since the venue regularly features bands playing at night. As it was (somewhat confusingly, but at least openly) explained to us, the LET is an 18% tax that's again levied on top of the 8% state sales tax (really? we need to check all this with an expert, which we shall), but rather than pass that whole fee on to the customer (as show-ticket box offices do), they've somehow negotiated a flat $2 fee, that in most instances works out cheaper for the customer, we were assured (although presumably not, for example, if you're eating there at lunch time and will never benefit from hearing any live music).
So, that's the lay of the land as best we can describe it right now, and we intend to further pursue a couple of the loose ends, so stay tuned. Meanwhile, if anyone out there has additional light to shed on any of this, or has experienced other dubious add-ons, separate from the Resort Fees we're all already well familiar with, then please drop us a line.