The news this week that the Justice Department had been caught spending $16 a piece for breakfast muffins and $8 for a cup of coffee for employees attending a conference in Washington two years ago was as stunning for its apparent extravagance as it was for the avalanche of criticism that quickly followed.
Within hours after The Washington Post, among other media outlets, pronounced word of the offense in a front page story Wednesday, based on a Justice Department auditor’s report, President Obama and Office of Management and Budget Director Jack Lew had ordered federal agencies to conduct a thorough review of how taxpayer dollars are being spent on conferences.
Senator Chuck Grassley, the senior Republican on the Senate Judiciary Committee, which has oversight of the Justice Department, said the report was a blueprint for the first cuts that should be made by the “super committee” searching for at least $1.2 trillion in savings. Even NBC’s Brian Williams featured the Justice Department’s offense in Wednesday evening’s news lineup as perhaps the most egregious example of wasteful government spending since the Navy paid Lockheed $640 for custom molded toilet seat covers.
But for anyone who has actually booked a conference at a hotel in Washington lately-or for that matter, treated a family of four to a basic assortment of food and drinks during a Redskins game–the outrage seems wildly misplaced.
No one would disagree $16 for a muffin, if correct–and as it turned out, it wasn’t– is an outrageous sum to pay. But how is it that the Capital Hilton, where the conference in question took place, and dozens of hotels and conference facilities throughout the Washington area, and indeed across the country, didn’t catch at least some of the flak for the prices they charge?
The fact of the matter is, the prices Washington area hotels charge for food and beverages have always seemed higher than what would be considered reasonable.
There’s a reason for that; or at least one that meeting planners in Washington have grown only too familiar with. Hotels traditionally make their money filling beds. But Washington’s peculiar business rhythms tend to draw a disproportionate volume of daytime meeting guests and relatively few who actually spend the night. So hotels, and caterers providing food services at places like the Ronald Reagan Building and the Washington Convention Center, have grown accustomed to marking up the margins exponentially on just about everything they serve. Throw in taxes and gratuities, and suddenly that cup of coffee makes Starbucks look cheap.
Try arranging a reasonably-priced conference at the Washington Convention Center. The going rate for cheapest box lunch you can order is $20 a box, and coffee goes for $50 a gallon (or about $4 a cup) plus a service fee and taxes.
Hotels typically work with smaller groups, provide more service and invariably need to charge more. So conference pricing for a continental breakfast at a typical good quality hotel in Washington costs about $28 to $36 per person. Bottled water or soft drinks? $5 a piece! How about a dozen cookies? Just $56 per dozen! Oh, and don’t forget to add the hotel’s 22% service charge and 10% more for DC sales tax.
You could try asking whether a hotel or conference center will let you book an event and then allow you to order in your own food, say from that local bakery shop that sells muffins at retail for just $2.50. Yeah, right! Even rookie meeting planners know better than that.
The point is, trying to hold a legitimate off-site meeting doesn’t come cheaply in Washington whether you’re organizing it for the Justice Department or private industry.
Sure, it would seem the conference planners at the Justice Department probably have done a better job negotiating with the Capital Hilton for better prices for muffins and coffee. And in fact, they did.
According to a subsequent Washington Post report, Hilton Worldwide, which manages and franchises hotels including the Capital Hilton, says the price included not only breakfast baked goods but also fresh fruit, coffee, tea, soft drinks, tax and tips. It says the report misinterpreted its invoices, which often use shorthand and don’t reflect the full menu provided.
Regardless, to put the blame totally on government employees, as the auditor and then the media so quickly did, and not at least in part on what and how hotels routinely charge for conferences services, is another example of how easy it has become in America to demonize the federal workforce–a group of dedicated public servants who in reality are working tirelessly to protect our country, provide services to the needy and tackle problems that are bigger than any one of us can solves alone.