Some casinos cancel energy surcharges

David Strow

Monday, Dec. 10, 2001 | 10:24 a.m.

Energy surcharges, once a subject of controversy along the Strip, have mostly evaporated during Las Vegas' unfolding tourism crisis.

Harrah's Entertainment Inc. of Las Vegas, one of the first companies to introduce the charges this summer, announced today it was dumping the $3 per night surcharge at the Rio and Harrah's Las Vegas.

But spokesman Gary Thompson said it has nothing to do with the weakening of Las Vegas tourism after the September terrorist attacks.

"Natural gas prices have come down, and that's why we cut the surcharge," Thompson said. "Electricity costs aren't bad. I'm not going to say they're good, but they're not bad."

Though electricity rates have not declined, Thompson said Harrah's was able to conserve energy through recommendations made by Enron Corp. But Harrah's is also hinting it could bring the charges back if Nevada Power Co. is successful in its efforts to win a 21 percent rate hike early next year.

"If our costs were to appreciate considerably ... we would pass some of those costs along to our customers," Thompson said.

But though Harrah's is the first to announce such a move publicly, it is not the only company to remove the charges. In the weeks following Sept. 11, visitor counts and hotel occupancy have plunged, and along with them, the rates charged by Strip hotels. In this environment, the $3 surcharges were quietly removed at the Strip hotels operated by MGM MIRAGE and Park Place Entertainment Corp.

Debbie Munch, spokeswoman for Park Place, said the charges were dropped at Park Place's five Strip properties one week after Sept. 11.

"We discontinued it as a result of two things: the results of the Sept. 11 attacks and the falling prices of energy," Munch said. "Each played a role."

Mandalay Resort Group doesn't impose the $3 surcharge at its properties, either. But the company never charged it to begin with.

"We're the only ones that never did," said John Marz, senior vice president of marketing for Mandalay. "We didn't believe it was the right thing to do."

But the charges remain off the Strip. For example, Boyd Gaming Corp.'s Sam's Town hotel-casino is still charging guests an energy surcharge, while the company's Stardust hotel-casino on the Strip does not.

Locals' gaming operator Station Casinos Inc. is maintaining its $3 surcharge because its energy costs are not declining and may increase next year, Chief Financial Officer Glenn Christenson said.