These hidden fees pop up at the end of a transaction, right at the moment a consumer is about to purchase a product.
"Think about the last time you went out for dinner, or ordered online and saw a convenience fee, a service fee, a wellness fee that you weren't quite sure what that was for," said Rep. Emma Greenman, DFL-Minneapolis.
She's carrying a bill this year to rein in the proliferation of businesses adding so-called hidden "junk fees" at the end of purchases, which have driven up the costs of everything from ordering at a restaurant and getting concert tickets to buying products online.
Greenman's bill, which is ready for a full vote in the Minnesota House, would amend the state's deceptive trade practices act and require any mandatory fee or surcharge to be included in the advertised or list price for goods and services.
"These junk fees have become impossible to avoid and leave consumers frustrated and confused and, importantly, make it impossible for them to comparison shop," she said.
The state-level push is happening at the same time the federal government is trying to crack down on these kinds of fees. Minnesota U.S. Sen. Amy Klobuchar is pushing bills to stop hidden fees in ticket sales and hotel bookings. The Federal Trade Commission is working on rules to ban hidden and misleading fees and require businesses to provide consumers with the total price up front.
Consumer Reports estimates the average American family spends more than $3,000 annually on junk fees.
Representatives from businesses asked Minnesota lawmakers to pump the brakes on the bill at least until the federal government has finished its rule-setting process.
"We do remain concerned over the implementation of this law and the potential inconsistencies and conflicts with the federal rules being proposed on this very issue," said Beth Kadoun, who works on tax and fiscal policy for the Minnesota Chamber of Commerce.
Scott Lambert, president of the Minnesota Automobile Dealers Association, said purchasing a vehicle is not a "simple, quick or an impulse item" and consumers have options for additional fees for things such as expediting their license plates or titles. Those would all have to be disclosed under the proposed legislation, he said.
"The deceptive trade practice statute has been used for years by the [attorney general] to very strong effect to enforce the state's advertising laws," he said. "This legislation, in our view, is a big departure, providing a prohibition against a specific act and doing so in a very prohibitive way."
The bill does make some exceptions. It allows restaurants to add automatic tipping at the end of a transaction, although it would prohibit other types of fees from being added on to the bill. It also allows the cost of postage and shipping to be listed separately.
Legislators are also trying to tackle this practice in a separate bill for concert and event tickets, requiring sellers to list the full price, including fees, upfront on their websites. The legislation was inspired by complaints from consumers who were hit with massive hidden fees when they tried to nab tickets for Taylor Swift's Eras Tour.
Greenman said her bill will create more transparency for consumers on most of the products they're purchasing.
"Folks are being nickeled and dimed by these extra fees," she said. "This bill is an attempt to end that and create price transparency in the market."
