Governor Signs Sen. Dodd’s ‘Junk Fees’ Ban

SACRAMENTO – Gov. Gavin Newsom has signed landmark legislation from Sen. Bill Dodd, D-Napa, in partnership with Attorney General Rob Bonta and Sen. Nancy Skinner, D-Berkeley, to outlaw hidden charges on purchases – also known as junk fees --  ensuring consumers are not exposed to deceptive business practices that add unfair costs.

“With the governor’s signing of this historic bill, we can finally take aim at dishonest junk fees that are tacked onto seemingly everything – from online concert tickets to hotel reservations,” said Sen. Dodd. “Now we can put the consumer first and create a level playing field for those businesses that advertise the real price, up front. “I appreciate everyone who worked to end these dishonest charges that boost corporate profits at the expense of those who can least afford it.”

In his State of the Union address, President Biden called out junk fees applied to an array of transactions involving banks, ticket vendors, airlines and online sellers. By one estimate, 85% of Americans have paid hidden fees totaling $28 billion per year. California, which has fifth largest economy in the world and the nation’s largest population, pays an outsized share. The president proposed federal action by numerous federal agencies to address issues within their subject matter and regulatory authority.

At the state level, Sens. Dodd and Skinner, along with Attorney General Bonta, introduced Senate Bill 478, which would expand on the White House proposal and put the Golden State at the forefront of banning these secretive fees, regardless of industry sector. The bill would expressly prohibit the pervasive and deceptive practice of advertising a certain price and then adding on mandatory charges that are controlled by the business. Companies that fail to comply with the new rules could be subject to steep financial penalties.

SB 478 received broad support from consumer groups and legislators before being signed by the governor.

“Today, California is eliminating hidden fees,” said Attorney General Rob Bonta. “These deceptive fees prevent us from knowing how much we will be charged at the outset. They are bad for consumers and bad for competition. They cost Americans tens of billions of dollars each year. They hit families who are just trying to make ends meet the hardest. And, because a growing list of websites, apps, and brick-and-mortar businesses are using them, they penalize companies that are upfront and transparent with their prices. With the signing of SB 478, California now has the most effective piece of legislation in the nation to tackle this problem. The price Californians see will be the price they pay. I am deeply grateful to Sens. Dodd and Skinner, the authors of SB 478, for their commitment to protecting consumers.”

 “California sent a clear message today: The days of bait-and-switch pricing practices are over,” said Sen. Nancy Skinner, D-Berkeley. “With Gov. Newsom’s signing of SB 478, Californians will know up front how much they’re being asked to pay, and no longer be surprised by hidden junk fees when buying a concert or sports ticket or booking hotel rooms for their family vacation.”

###

Senator Bill Dodd represents the 3rd Senate District, which includes all or portions of Napa, Solano, Yolo, Sonoma, Contra Costa, and Sacramento counties. You can learn more about the district and Senator Dodd at www.sen.ca.gov/dodd.