News

By Julie Veach, Chief, Wireline Competition Bureau

Today, the Commission released an Order that will provide meaningful relief to millions of Americans who have borne the financial burden of unjust and unreasonable interstate inmate calling service (ICS) rates.  These reforms are the right thing to do.  Our actions will increase inmates’ ability to stay in contact with their families and loved ones—including the 2.7 million children with an incarcerated parent.  That increased contact reduces recidivism, which benefits all of us through safer communities and by reducing the expense of incarcerating the re-offenders.  In fact, one study notes that a 1% reduction in recidivism would lead to $250 million in annual cost savings.

The ICS rates that spurred us to act are high.  In one case, the cost of a 15-minute call is $17.50—about $1.15 per minute.  The Order we released today is a major step toward fulfilling our statutory obligation to ensure that rates for all consumers are just, reasonable and fair.

Let’s take a look at the reforms:

• The Order requires that all ICS providers’ interstate rates and charges be cost-based.  This applies not only to the rates for making a call, but to other charges like fees for establishing, maintaining, or funding an ICS account.

• The Order also adopts interim caps for interstate inmate calling rates.  The caps are $.21 per minute for interstate debit and prepaid calls, and $.25 per minute for interstate collect calls.  No provider can charge rates above these caps without getting a waiver from us first.

• The Order adopts interim “safe harbor” rate levels—$.12 per minute for interstate debit and prepaid calls, and $.14 per minute for interstate collect calls.  ICS providers can utilize the safe harbor and receive the benefit of a presumption that their rates are cost-based.