AUSTIN (KXAN) — As historic winter weather continues in the Austin-Travis County area, many residents without power claim they’ve found available hotel rooms but that prices per night have been hiked exceedingly high.
KXAN received several emails Monday evening and Tuesday morning showing rates from $500 to $999 per night for a room at the Ramada by Wyndham in South Austin. The emails raised concerns that the hotel, located at 4323 South Interstate-35, could be price gouging.
A spokesperson for Wyndham Hotels & Resorts provided the following statement:
“We do not tolerate price gouging and require that hotels comply with all local, state and federal laws. In speaking with the owner of this hotel, which is independently owned and operated as a franchise, it’s our understanding that the temporary rate increases seen online were the result of the property working to close out its inventory as it managed the loss of power and other utilities. We have since been assured that no guests were charged, nor was there any intent to charge, the rates shown. While the hotel is not accepting new reservations, guests currently staying at the property are being allowed to extend their stay at no additional cost while they wait for conditions to improve.”
Jay Mazur, a spokesperson for Travis Walk Associates LLC, which is the franchise operator of the hotel, said the pricing of $500 to $999 did happen, but it was caused by “an employee error” and should not have occurred. Mazur said nobody was charged that amount, and it was removed as soon as it was discovered by management.
Mazur said the high prices were related to a power outage at that location at about 2 a.m. Monday. The hotel uses a dynamic pricing model, and the system dynamically chooses the best rate based on demand.
“Because the hotel didn’t have power they were not able to go in and close out the rate system and block availability. So, an employee at another property who had multi-property access went in and manually raised it to the highest value in order to deter people from booking the hotel, which is a frequent practice among hotels during high occupancy times, but not during a pandemic, and this employee shouldn’t have done that. As soon as we were made aware, we closed that. But it was visible for a period of time at that high rate,” Mazur said. “Any reservation that came through was cancelled.”
“Obviously this was a public rate, and it never should have happened. I want to be clear that we never charged anyone.”
Mazur added that the location is providing food for free and a place to get warm for guests. The high prices seen briefly on the internet were “the opposite of what we are trying to do right now,” he added.
We have called several other hotels about price gouging, and we will update this report as more information about complaints becomes available.
Price gouging enforcement
Travis County Judge Andy Brown said he’d sign an order specifically addressing price gouging in the area and making sure people understand it is illegal.
The Texas Office of Attorney General enforces price gouging laws. A spokesperson for the Office said price gouging isn’t based on price alone, and businesses can determine prices for their products.
“However, if a disaster has been declared by the Governor of Texas and businesses raise the price of their products to exorbitant or excessive rates to take advantage of the disaster declaration, then it is quite likely that price gouging is taking place, and a complaint should be filed with our office concerning the incident.”
A price gouger could be hit with a civil penalty of $10,000 per violation and up to $250,000 if the consumers are elderly, according to the Attorney General’s Office.
The Attorney General’s Office could not immediately provide the number of complaints related to the current winter emergency.
It’s illegal to raise prices to profit on necessities such as fuel, food, medicine, lodging, building materials and other items once the governor or president issues a state of emergency.
The Attorney General’s Office received 68 price gouging complaints following Hurricane Laura last September and over 5,000 complaints after Hurricane Harvey in 2017.
As of Tuesday, at least a third Texans statewide are going on nearly 24 hours without power as single-digit temperatures persist. Meanwhile, about four million Texans are currently without power.
In Austin, 40% of Austin Energy customers don’t have power — in addition to the 46% of Oncor customers in the area and 34% of Pedernales customers.
If you are experiencing something similar, you should report it the Office of the Attorney General. To file a consumer complaint, click here.