New Jersey bill would destroy hotel franchising, drive hotels from Garden State

Trenton NJ

WASHINGTON (Feb. 22, 2024) – American Hotel & Lodging Association (AHLA) President & CEO Chip Rogers released the following statement today after the New Jersey Assembly Committee on Financial Institutions and Insurance approved legislation that would destroy the hotel industry’s franchise model. The bill (A3495) is now awaiting further Assembly action, and companion legislation (S2336) has been introduced in the Senate.

“New Jersey bill A3495 and its Senate companion, S2336, would severely limit hotels’ ability to enforce the quality, service, and safety guidelines guests know and trust. In doing so, the legislation would destroy the hotel industry’s franchise model – a beacon of success that has created millions of jobs and helped thousands of Americans realize the dream of owning their own business,” said AHLA President & CEO Chip Rogers.

“For more than two years, AHLA has sought to engage with proponents of this misguided legislation about our concerns. Yet today – on a two-hour notice – this extremely damaging proposal was scheduled for a vote,” Rogers said. “A change to state law that will have such an immense impact on hoteliers, travelers visiting the state, and the entire tourism economy must be subject to honest debate. With major sporting events heading to the Garden State, we look forward to working with lawmakers to defeat this dangerous and ill-advised legislation, which could drive well-known and respected hotels out of New Jersey and cost the state thousands of jobs.”

Background Info:

New Jersey bills A3495 and S2336 would:

  • Require brand improvements such as Wi-Fi, mobile check-in, breakfast, etc., to be negotiated property by property, which will weaken brand standards.
  • Allow hotel owners to use “comparable” products to those required by brands, which will weaken brand standards and lead to increased litigation as both parties try to determine what is comparable.
  • Force hotels to allow their federally registered trademarks to be used on “comparable products,” undermining the value and destroying the trust in these trademarks.
  • Undercut the loyalty points system that many brands use to reward loyal customers, which could force many brands to terminate these loyalty programs in New Jersey.