Photographer: Charlie Riedel/AP Photo

Is This the End of Sky-High Prison Phone Call Rates?

After a 14-year fight, the FCC has passed rules limiting how much inmates have to pay to make phone calls.

The Federal Communications Commission is putting caps on the rates that inmates pay for phone calls, after a 14-year campaign by advocates for prisoners and their families. The order caps per-minute fees at 11¢ in state or federal prisons, and up to 22¢ a minute in local jails, depending on the size of the facility, while also capping the various fees that have been common on inmate calls to this point. This is fundamentally cheaper than many current rates, which were as high as 89¢ a minute in 2013, even before factoring in fees. 

Mignon Clyburn, the FCC commissioner who has been championing the issue, gave a tearful speech before the vote, pointing out how this issue always seemed to be at the end of the FCC's to-do list and saying that she was proud it had finally gotten around to passing rules “so that families could make a simple phone call and express their love over the phone without sinking into a further economic morass.” The vote followed party lines, with Republican commissioners Ajit Pai and Michael O'Rielly saying the FCC didn’t have the authority to regulate prison phone rates.

Pai dedicated his comments to outlining in grisly detail some of the violence that surrounds the contraband cellphone trade in Georgia prisons. He didn't attempt to link this directly to his opposition to the proposed rules. In fact, after New York lowered the rates on its inmate calls, state officials say the market for illicit cellphones dried up, and its Department of Corrections confiscated fewer than 100 cell phones in 2012, compared with more than 10,000 seizures in similarly size penal systems. FCC Commissioner Thomas Wheeler grabbed on this point. “One of the incentives to have cellphones in prison is the absurd and usurious cost inmates face,” he said. “Today we are dealing with that.” 

The FCC’s rules don’t address a more recent controversy regarding inmate communications: expensive video-chat services that can come with the requirement to limit in-person visits. The commissioners also leave in place one of the odder aspects of the prison telecom industry. Facilities generally sign exclusive contracts with specialized phone carriers, which compete in part by offering to pay the prisons a portion of the money they collect from inmates’ phone bills. These commissions have ranged as high as 96 percent of call revenue, according to the FCC. They create a steady upward pressure on rates, as providers look to recoup generous commissions by charging more for service. At times, advocates and some prison telecommunications providers have called for banning these commissions outright. In a letter sent to the commission last week, some of the biggest companies in the industry urge the commission to eliminate these payments. But the FCC’s rules don’t do that. Instead, the commission “strongly discourages” their use. 

Peter Wagner, the executive director of the Prison Policy Initiative, one of the groups that has been pushing for rate regulations, has fought to eliminate site commissions in the past. But he recently decided it wasn’t worth the effort, since companies have other ways to throw money around to win contracts, such as donations to local sheriffs. “We see no benefit to the FCC engaging in a protracted game of whack-a-mole when the Commission can instead reduce the influence of all of these market-distorting payments simply by putting in place a very low ceiling for rates and fees,” he wrote in a letter to the FCC this summer. Wagner says he is satisfied with the rules the FCC approved Thursday. 

Not Global Tel-Link and Securus, the two largest providers of phone service at correctional facilities. The assertion by the Republican commissioners that the FCC doesn’t have the authority to regulate rates would provide grounds for a legal challenge, and it seems that the companies will be looking for such grounds. In a statement, Brian Oliver, Global Tel-Link's chief executive, called the rules disastrous. "This action creates significant financial instability in the industry and ultimately hurts inmates and their families—the very people the FCC set out to help," he said. Securus argued that the rate caps are below its costs of doing business and said it would appeal to the D.C. Circuit of the U.S. Court of Appeals, while also asking for a stay on the FCC's order. 

Looks like the fight over how much prisoners pay for phone calls will continue a while longer. 

Before it's here, it's on the Bloomberg Terminal. LEARN MORE