Divided FCC Raises Inmate Calling Rate Caps, Doesn't Limit Site Commissions

The new, higher caps replace caps in a 2015 order that were stayed by the U.S. Court of Appeals for the D.C. Circuit pending further review of ICS provider and state and sheriff legal challenges (Global Tel*Link v. FCC, No. 15-1461) (see 1603070055 and 1603230058). The FCC's 2013 interim rate cap of 21 cents per minute for debit and prepaid interstate ICS calls remains in effect, but it doesn't cover intrastate ICS calls. Thursday's order raises the tiered rate caps for debit/prepaid ICS interstate and intrastate calls in prisons and jails from 11-22 cents per minute to 13-31 cents per minute, with rate caps the lowest for federal or state prisons and ascending for large jails, midsize jails and small jails. The new caps won't take effect for at least three months in the case of prisons and at least six months in the case of jails.

Democrats voiced impatience with objections to FCC restrictions on ICS charges that they say are often inflated and unjustified under the law. They said lowering calling costs helps inmates and their families stay in contact and reduces recidivism. Clyburn said "too few people really care" about the efforts to "moderate an industry that uses inmates as a captive profit center and bankrupts families and communities." She said she is "downright disappointed, to say the least, that too many correctional facilities do not give a second thought to using egregious profits and outrageous revenues extracted from those who are least able to pay, to fund operations that often have nothing to do with inmate needs, or ... with the provisioning of calling services." Rosenworcel said she is "tired that we are still at this" and "there is something wrong that after all this time, we are still calibrating rate caps, considering site commissions, and adjusting permissible fees" to address "outrageous" costs that harm inmate families.

Dissenting Republicans said the FCC is disregarding its authority and the record. "Twice before, I have urged my colleagues to adopt reasonable regulations that would substantially reduce interstate inmate calling rates and survive judicial scrutiny. Twice they have declined. And so our rules have gone to court again and again, only to be blocked again and again and again," said Commissioner Ajit Pai. "This is not and should not be hard. We cannot set rate caps that are below the costs of providing inmate calling services. We cannot ignore record evidence regarding those costs. And we cannot exceed the bounds of our jurisdiction. It’s really that simple. Yet -- here we go again."

The order used the same four tiers it adopted in 2015 to set the new rate caps for interstate and intrastate debit/prepaid ICS: state or federal prisons, 13 cents per minute (up from 11 cents per minute); jails with 1,000 or more inmates, 19 cents per minute (up from 14 cents per minute); jails with 350-999 inmates, 21 cents per minute (up from 16 cents per minute); and jails of up to 349 inmates, 31 cents per minute (up from 22 cents per minute). Rates for collect calls for each tier "are slightly higher in the first year and will be phased down to these caps after a two-year transition period," the release said: "By covering the legitimate costs of jails and prisons, this adjustment will ensure continued availability and development of inmate calling services, while still resulting in significant savings for inmates and their families."

The prison and jail rate caps will take effect 90 days and six months, respectively, after being published in the Federal Register, said Christine Sanquist, attorney adviser, who outlined the item at Thursday's meeting. The order clarifies regulatory definitions to prevent providers from marking up the mandatory taxes and fees they pass through to consumers, she said.

Pai said the FCC is belatedly correcting a 2015 mistake, when it didn't account for the ICS costs of correctional faculties, but he still couldn't support the action because it ignored "basic principles" of "costs, evidence and legal authority." Wheeler said nobody is always right and the FCC was simply "adjusting its response" as it collected more information to address a "reprehensible situation" and "put this issue behind us."

The FCC doesn't consider site commissions a legitimate ICS cost of facilities, Clyburn said. "Site commissions comprise just a small fraction of correctional budgets, but have a massively regressive economic impact on inmates and their families," she said. "There are costs that facilities may incur in providing inmate calling services, but there are no costs that justify the scope of most of these commissions." She urged states and localities to rein in site commissions, and applauded those that already made reforms. The FCC concluded it lacked the authority to ban site commissions, she told reporters afterward. Without site commission restrictions, ICS providers will likely seek a stay of the new caps, an informed person had told us.

Commissioner Mike O'Rielly said the FCC should have asked Congress for site-commission regulatory authority. "This item is defective on so many levels," he said. "It fails to provide real and necessary relief for inmate calling providers, doesn't sufficiently address the issues that produced the current stay of our ill-fated previous inmate calling items, and raises false hope for the prisoner population and their families. Indeed, it is an attempt at political and administrative expediency when cooler heads are needed to find a sustainable, long-term solution. I can't think of a sadder, more disappointing outcome."

Wright Petitioners counsel Lee Petro suggested his advocacy group was satisfied. "While the Wright Petitioners continue to believe that the data submitted by ICS providers and correctional authorities substantially overstated their respective costs to make ICS available to inmates and their families, the revised rate caps will fully compensate the parties for these reported costs, and will expedite regulatory relief for both interstate and intrastate customers," he said.

Pay Tel Communications welcomed the FCC's shift but adopted a wait-and-see approach. “I was glad to see that the FCC has finally recognized that facilities do incur legitimate costs associated with making ICS available," President Vincent Townsend emailed. "This is a very significant development -- and something that Pay Tel has consistently advocated. How this gets implemented, though, is still a question mark. I look forward to reviewing the text of the order when it’s available.”