Click-to-cancel, auto-renewal and price transparency were among the key issues at statehouses across the country in 2024
While national laws and regulations like the FTC’s recent ‘click-to-cancel’ rule tend to dominate headlines, the Health & Fitness Association (HFA) is spotlighting key legislative issues at the state level, which often have the biggest impact on fitness businesses’ bottom lines.
In 2024, the HFA has tracked more than 1,000 bills in 20 states, reviewing each piece of legislation to determine its likely impact on the fitness industry, the organization shared in a recently released 2024 State Advocacy Report.
HFA leaders also met with state lawmakers and partnered with state lobbyists to push for beneficial legislation for fitness businesses across the country.
According to the report, the HFA secured 48 wins and just one loss on key bills in statehouses across the country in 2024. Among the key legislative issues at issue, the HFA spotlighted:
- Click-to-cancel and auto-renewal
- Price transparency
- Sales tax on memberships
- Data privacy protection
- Cashless retail bans
- Liability waivers
“The advocacy work we’ve undertaken this year is more than just a return on investment – it’s an insurance policy for every fitness business, big or small,” HFA vice president of government affairs Mike Goscinski wrote in a note to members. “By blocking costly and restrictive legislation, we are safeguarding the bottom line of gyms, fitness centers, and health clubs across the country, from boutique studios to national chains. This protection ensures that our industry can continue to thrive, free from unnecessary burdens.”
Click-to-Cancel & Auto-Renewal
Per the report, the HFA stopped or amended 31 state bills related to click-to-cancel and auto-renewal requirements. Broadly speaking, those types of bills would require fitness facilities to offer more cancellation options to their members, exposing businesses to increased costs and putting them at risk for higher churn rates.
The HFA secured wins in states including New York, California and Massachusetts on click-to-cancel and auto-renewal issues. According to the organization, California operators would have faced nearly $70,000 annually in additional staffing costs due to proposed phone-staffing requirements if the HFA hadn’t intervened.
“‘Click-to-cancel’ may sound good in theory, but without considering how such a policy is carried out in today’s complex digital processing world and other practicalities, these proposed laws end up not just harming businesses but also the customers they serve,” Goscinski wrote.
It’s worth noting that the Federal Trade Commission (FTC) last week introduced a national click-to-cancel rule that will force fitness facilities across the country to make it easier for members to cancel memberships online or over the phone. The rule is bad news for fitness businesses nationwide, exposing them to increased operational burdens and a heightened risk for cancellations, although the HFA pointed to key concessions it helped secure that should soften the blow for gyms and studios.
Total Pricing Disclosure Requirements
In 2024, the HFA also tackled price-transparency bills at the state level. These bills relate to “total price” disclosure and seek to force fitness businesses to disclose the full cost of all memberships, including fees and service costs.
According to the HFA, total-pricing bills conflict “with the diverse nature of the fitness industry. This would result in vague pricing, reduced consumer clarity, and potential fines or lawsuits.”
In 2024, the HFA was successful in stopping or amending eight total-pricing bills in five states: Minnesota, Virginia, Colorado, Illinois and New York.
In 2025, total-pricing bills are expected to be introduced or re-introduced in states including Virginia, Colorado, New Jersey and Maryland, the HFA says.
Sales Tax on Fitness Memberships
The HFA is also fighting back against state bills that would increase the sales tax Americans have to pay on fitness memberships.
“New or increasing taxes levied on physical activity hamstring an operator’s ability to grow and restrict access for Americans trying to stay healthy,” the organization points out.
In 2024, HFA leaders took aim at sales-tax bills in Maryland, Connecticut, Oklahoma and Kansas. They were successful in stopping or amending a bill in Maryland.
Next year, Maryland, New York, California and Minnesota are expected to introduce new sales-tax bills.
On the other end of the spectrum, lawmakers in some states are working to reduce or eliminate sales tax on fitness facilities. The HFA notes four such bills were introduced this year; the organization says it will work to push those bills over the line in 2025.
Data Privacy, Cash & Minimum Wage
The HFA also says it has worked to stop or amend bills related to data privacy protections (Washington), cashless retail bans (Florida, Vermont) and minimum wage increases (California).
The organization also highlights work it’s doing to promote fitness facility subsidies, expanded insurance coverage for fitness businesses, automated external defibrillators (AED) liability protections, and tax credits for military members and their families to join fitness facilities.
“In Pennsylvania, a bill we supported offered a $600 credit for National Guardsman, reservists, and active military personnel to use at the fitness facility of their choice,” the HFA notes. “The bill passed, and others are being proposed in more states.”
What To Watch for in 2025
Looking ahead to 2025, the HFA spotlights several key legislative issues worth monitoring in statehouses across the country.
Potential risks for 2025 include the expansion of consumer protection laws (click-to-cancel, auto-renewal and member privacy), a push for increased sales tax on fitness memberships and services, and proposed minimum wage increases.
The outcome of elections next month at the state level will likely impact the legislative landscape in 2025.
“A shift in party control in key states could mean more aggressive regulation or, conversely, opportunities for pro-business reforms,” the HFA notes. “No matter the outcome, HFA is prepared to represent and protect your business.”
View the HFA’s 2024 State Advocacy Report in full here
