FCC Fee Reduction Adjustments
Grayson County

Agenda

1. Review of FCC Order which was partially stayed
2. Explanation of revenue and commission structure and
rebalance proposal

3. Review of Grayson Counties current Transactions,
Commissions and Proposed Options
4. Next Steps; Commissioners court date on May 17th ?

5. Signed contract addendum by May 31st, 2016
SECURUS Technologies | 2

Objective
Objective
With the recent STAY order that was approved by the 12th Circuit Court, Securus
was successful in defending our customers’ best interests by stopping the FCC from
lowering calling rates below a point where commissions were impossible to pay.
That is a HUGE win for our customers. However, though we stopped part of their
illegal lawmaking, there are portions of the order that were not stayed and will
therefore require MINOR and TEMPORARY changes to many of our customers’
agreements. These changes are temporary in that we believe that once we are
ultimately victorious in our legal battle with the FCC, we will be able to revert to our
originally agreed upon terms. The items that must change are as follows:
• Funding fees are now capped at $3.00 for automated transactions (90% of our
volume today) and $5.95 for operator necessitated transactions
• Most other fees have been eliminated
• We can no longer charge surcharges per call that are not tied to an increment of
usage
• This does NOT mean that each minute of usage can not be a different
amount from another minute of usage
SECURUS Technologies | 3

How providers make money

When we originally bid on your contract we used:
Fees charged
to end users
•
•
•
•
•
•

Monies collected from
the completion of calls

Funding Fee
Bill Statement Fee
Regulatory Recovery Fee
Cost Recovery Fee
Voice Biometric Fees
Location Validation Fees

Securus uses the money we have left over to
staff a call center, provide 100% of the
equipment you use, staff technical support,
account managers, customer service
representatives, network engineers, expert field
technicians etc. 100% of the operating
expense for the provision of inmate phone
service is paid from what is left over.

Total Revenue
generated from the
contract

Commission offer is
generated

SECURUS Technologies | 4

Impact of the Changes

When we originally bid on your contract….
Fees charged
to end users

Monies collected from
the completion of calls

Total Revenue
generated from the
contract

Fee caps/eliminations
imposed mean lower
revenues on this side of
the equation
This must be increased
In order to offset this
reduction, basic
algebra tells us that
either:

Commission offer is
generated

OR

This must be decreased

SECURUS Technologies | 5

Grayson County Amendment

Avg Fee Before FCC
Changes
Avg Fee After FCC
Changes
Option 3 would
reduce the monthly
commission to
approx. $3076 but
would not impact
call rates

Proposed Increase in
rates. The delta from
current to new is noncommissionable, and
will re-balance revenue

SECURUS Technologies | 6

Execution of Contract Amendment

Questions, comments concerns?

SECURUS Technologies | 7

SECURUS Technologies | 8