What I've Learned Working to Ban Junk Fees
Lessons from the statehouse trenches.
This is Boondoggle, the newsletter about how corporations rip off our states, cities, and communities, and what we can do about it. If you’re not currently a subscriber, please click the green button below to sign up. Thanks!
The Illinois legislature recently approved the Junk Fee Ban Act, sponsored by State Rep. Bob Morgan and State Sen. Omar Aquino, and Gov. JB Pritzker has already said he will enthusiastically sign it, after calling for its passage in his annual state of the state address this year.
Once enacted (assuming another state doesn’t race ahead), Illinois will be the seventh state with an economy-wide ban on junk fees, those ubiquitous service and processing fees that are sprung on consumers at the last moment, driving up prices and costing families thousands of dollars per year. (The other six states, for those keeping score, are: California, Colorado, Minnesota, Connecticut, Virginia, and Massachusetts.)
In the states with these laws, sellers need to display “all-in” prices: Any mandatory fees need to be included in the base price in advertisements and price listings, which functionally makes them pointless, since they can’t be broken out and charged individually. So, for example, a $10 flower delivery with a $10 mandatory “processing” fee that’s sprung on the buyer at the end needs to be listed as simply a $20 delivery.
My organization launched the End Junk Fees campaign three years ago to support state legislators aiming to enact laws just like these, and I’ve been closely involved in several of the state efforts I mentioned (and many more that haven’t ended with a law, yet).
With most 2026 state legislative sessions winding down and the campaign putting another win on the books, I thought I’d lay out some lessons learned so that more states step up in the coming years, especially as “affordability” becomes the hot new political watchword.
People understand these laws are meaningful: Polling consistently shows that people oppose junk fees, correctly finding them deceptive and unfair, and would support politicians who work to eliminate them. But I’ve also heard anecdotally from multiple state legislators who sponsored these bills that it’s the one they hear about most consistently from constituents; voters distinctly remember them for their work to eliminate junk fees. Before we launched the campaign, we suspected the politics around specific state bills would be good, and that has borne out.
Small business support matters: It tends to be the case — though this is not universally true, to be sure! — that large, dominant corporations use junk fees more than their smaller competitors, betting on name recognition or monopoly power to push consumers past their anger at being dinged with a last-second fee. (Think Ticketmaster/LiveNation versus smaller, independent ticket sellers and venues.) In the places, most prominently Colorado, where small businesses rallied to support a junk fee ban, it made a big difference politically, as small business owners are the ultimate sympathetic constituency in most statehouses. And these laws help them compete, so small business owners should back them out of pure self interest. I’d recommend small business organizing be a key piece of future legislative efforts in the states that don’t have a ban on the books yet.
Housing matters, too: The other constituency that really helps is renters, as rental housing is where folks very often experience unfair, undisclosed fees. (Surprise, you have to pay for “valet trash pickup” every month, which we didn’t tell you!) Having tenants associations and unions, affordable housing groups, and actual renters behind these bills made a difference. I’ll point again to Colorado, which has the most explicit, robust, protections for renters from junk fees, as somewhere where that support made a critical difference.
“We don’t do this but we need an exemption”: Now, to some of the pushback these bills receive, and how to diffuse it. Just about every industry player comes out of the woodwork to beg for an exemption from the bill, with many of them claiming they don’t actually use junk fees, but need to be exempt for reasons. There are very few complaints on the substance that are legitimate, and nearly all of the real ones can be accommodated with simple clarifications about consumer choices. For example, moving companies need to be able to charge different rates according to distance — which is fine! — but that doesn’t mean they get to tack on undisclosed, mandatory charges at the end of the process, too. Legislators working on these bills need to remember they are trying to ban a specific tactic, and other pricing quirks can be accommodated without full-blown exemptions for entire industries.
Beware sweeping preemption claims: There are some industries where state lawmakers simply can not regulate fees because federal law preempts, or forbids, it, with the most prominent being airlines and national banks. There are also some industries, such as broadband services, that are subject to existing federal price transparency laws, and the industries in question usually want deference to those rules. That’s fine if those rules actually require all-in pricing, and as long as the industries would be pulled under the state law should the federal pricing rule go away. But other sweeping exemption claims are likelier than not lobbyists trying to snow legislators into exempting problematic activity that isn’t actually regulated by federal law.
Deal restaurants in from the start: One of the ways in which consumer frustration with junk fees is most obvious is in the “service” fees charged by restaurants, often sprung on diners at the last second, hidden in tiny fine print on menus where they’re disclosed at all. However, the restaurant lobby is incredibly powerful in most states, so legislators tend to exempt restaurants from the start of the process in order to take a heavyweight member of the opposition off the table. I think that’s a mistake: In Minnesota, where they did not take such a step, it was clear that directly addressing restaurant service fees made the bill more appealing and understandable to voters, and they landed on a workable compromise with the restaurant industry that helped the bill become law. Exempting restaurants from the start, meanwhile, takes an impactful example for constituents off the table, and opens up a “why not us?” round of questioning from every other industry.
“Sector by sector” is a lame excuse: New York’s junk fee ban has been stuck in the mud for years, even though it’s passed the state Senate multiple times, because the Assembly side of the legislature doesn’t want to do a comprehensive bill, but prefers to take a “sector by sector” approach. I’ve heard similar excuses in other states, too. I don’t know if this is a serious claim or a way to make inaction more palatable, but to be clear, a sector by sector approach would be ridiculous: Instead of one bill, eliminating a tactic that is industry agnostic, legislators would have to tackle countless bills, and update them constantly. It would be an extremely silly way to make policy, resulting in tedious new efforts every year, whereas an economy-wide ban sets a standard that is easier to update and doesn’t play favorites.
At the end of the day, this is a very simple policy proposal: The price you see should be the price you pay, because deceptively hiding fees that will be charged no matter what is unfair to both consumers and competitors, making the seller appear artificially less expensive than they really are. Legislators can and should push to have their states join the list of where this practice is banned, if not because it’s right on the merits than because their constituents — both consumers and local business owners — will notice and be grateful.
UPDATE: Tennessee is officially the second state to adopt a law preventing pharmacy benefit managers — the drug industry’s pernicious middlemen — from also owning pharmacies. (More background on this bill and issue here.) CVS, of course, sued the state immediately.
SIMPLY STATED: Here are links to a few stories that caught my eye this week.
The California Assembly and Rhode Island Senate both passed bills to ban restrictive deeds that dominant grocery stores use to limit competition. (Background on this issue here.)
Ohio’s data center tax break was expected to cost $136 million last year. It’s actual cost was nearly $1.5 billion.
Congress may override state laws regulating driverless trucks.
“A new study from the New Mexico Legislative Finance Committee found none of the 24 state tax credits or cuts aimed to spur economic development has resulted in increased revenues for the state.”
Auto debt in the U.S. “has reached $1.68 trillion, a 37 percent jump since early 2018, and now comprises the largest volume of outstanding loan debt ever recorded.”
Nearly a dozen states have banned “digital sweepstakes games,” a form of online gambling.
Thanks for reading this edition of Boondoggle. If you liked it, please take a moment to click the little heart under the headline or below. And forward it to friends, family, or neighbors using the green buttons. Every click and share really helps.
If you don’t subscribe already and you’d like to sign up, just click below.
Thanks again!
— Pat Garofalo
Congratulations on your successes, and I couagree with you more.
Also, thanks for the education on this subject.