ALL OF YOUR MONEY:
KICKBACKS, RATES, AND HIDDEN FEES
IN THE JAIL PHONE INDUSTRY

PR ISON

DREW KUKOROWSKI, PETER WAGNER & LEAH SAKALA

~~!1 ~ :POLICY
2;~ INITIATIVE
MAY 2013

ACKNOWLEDGEMENTS
We dedicate this report to the memory of Jon E. Yount and the thousands of incarcerated men and women who have struggled
to bring public attention and oversight to the prison telephone industry. We are grateful to Rebecca Young and Michael Fellows
for suggesting this report’s focus on jails and fees. We thank our individual donors who supported this project with their
generosity, allowing us to seize the opportunity to produce this report on a short timeline. This report could never have been
completed without the invaluable assistance of Prison Policy Initiative Legal Director Aleks Kajstura. We thank Sadie GoldShapiro, our work study Research Associate, for finding the CenturyLink discussion of dropped calls, and Bob Machuga for
designing the report cover. We are grateful to our colleagues who shared their expertise with us for this report, including Neelum
Arya, Alex Friedmann, Sonia Kowal, Lynnsey Lafayette, Lee Petro, and Bonnie Tenneriello. And finally, we thank the New York
Times editorial board for coming up with, in an August 31, 2005 editorial, the title of our report.

ABOUT THE AUTHORS
Drew Kukorowski is an attorney and author of the The Price to Call Home: State-Sanctioned Monopolization in the Prison Phone Industry
(2012). He studied law at the University of North Carolina, earned a M.A. in moral and political philosophy from Tufts
University, and studied economics and philosophy as an undergraduate at the University of Maryland at College Park. He is
licensed to practice law in Maryland and North Carolina.
Peter Wagner is an attorney and Executive Director of the Prison Policy Initiative. His publications include Importing Constituents:
Prisoners and Political Clout in New York (2002); The Prison Index: Taking the Pulse of the Crime Control Industry (2003); and Breaking the
Census: Redistricting in an Era of Mass Incarceration, 38 William Mitchell L. Rev. 1241 (2012).
Leah Sakala is a Policy Analyst at the Prison Policy Initiative. She is a graduate of Smith College, where she majored in American
Studies and Public Policy. She authored Return to Sender: Postcard-only Mail Policies in Jail (2013) and co-authored Reaching Too Far,
Coming Up Short: How Large Sentencing Enhancement Zones Miss the Mark (2009).

ABOUT THE PRISON POLICY INITIATIVE
The non-profit, non-partisan Prison Policy Initiative was founded in 2001 to demonstrate how the American system of
incarceration negatively impacts everyone, not just incarcerated people. The Easthampton, Massachusetts based organization is
most famous for its work documenting how mass incarceration skews our democracy via “prison gerrymandering”. Other
projects have included groundbreaking reports about sentencing enhancement zones and jail mail restrictions, and online
resources that give activists, journalists and policymakers the tools they need to participate in setting effective criminal justice
policy.

FOR MORE INFORMATION
For more information, including copies of this report and links to additional resources, see http://www.prisonpolicy.org/
phones/ .

PR ISON
POLICY INITIATIVE

PO Box 127 Northampton MA 01061
http://www.prisonpolicy.org

EXECUTIVE SUMMARY
At a time when the cost of a phone call is approaching zero,
one population is forced to pay astronomical sums to stay in
touch: the families of incarcerated people. For a child to
speak with her incarcerated parent, a family member or friend
is forced to pay almost $1 per minute, plus a long list of
other fees that easily double the total cost of the call. Faced
with phone bills that can total hundreds of dollars, many
families have to choose between paying for calls and paying
for basic living expenses.
Social science research shows that strong community ties are
one of the best predictors of success after release from
prison or jail, but the prison telephone market threatens
those ties because it is uniquely structured to create a
counter-productive cycle of exploitation: prison systems and
local jails award the monopoly contracts to the phone
company that will charge the highest rates and share the
largest portion of the profits. The prisons and jails get their
commissions, the phone industry gets the fees, and the
families get the hefty bills.
While previous research has documented the unjustifiably
high calling rates in the prison phone industry, this report is
the first to address in depth the many fees prison phone
customers must pay. We find that meaningful regulation of
the prison phone industry must stem from a comprehensive
analysis of the customers’ whole bills, rather than limiting the
discussion to addressing the high per-minute calling rates
alone.
This report finds that fees have an enormous impact on
prison phone bills, making up 38% of the $1 billion annual
price of calling home. This report details the fees that prison
phone companies charge for “services” such as:
• accepting customers’ money (deposit fees of up to
$10/deposit)
• holding on to customers’ money (monthly account fees
as high as $12)
• closing customers’ accounts (refund fees of up to $10)
This report reveals that these fees are but the tip of the
iceberg, though, as many other charges are far less
transparent. For example, some companies operate “single
call programs” that charge customers who do not have
preexisting accounts up to $14.99 to receive a single call from
a prison or jail. Some companies have hidden profit-sharing
agreements with payment processors such as Western Union,

which are not disclosed to the correctional systems that
award contracts. Other companies give their fees
government-sounding names, even though the fees are not
required by the government and may not even be paid to the
government.
Unlike in most industries, bad customer service is a key
source of revenue for prison phone companies. For example,
most of the industry finds it economically advantageous to
use poorly calibrated security systems to drop phone calls and
trigger additional connection charges. Other companies show
no hesitation to triple the cost of a call made to a local
cellphone by charging consumers the more expensive long
distance rate.
Previous research has generally focused on the price to call
home from state and federal prisons, but we find that limiting
the scope to prisons only significantly understates the sheer
number of families that must bear the burden of exorbitant
phone bills. This report expands the discussion to also
include the families and friends of the more than 12 million
people who cycle through 3,000 local jails across the country
every year. To our knowledge, almost no local jails refuse
commission payments in order to make calling home more
feasible.
Because the opportunities for consumer exploitation in this
broken marketplace are almost endless, regulation by the
Federal Communications Commission (FCC) is the only
permanent, nationwide solution that would remove the
inherent conflicts of interest between the facilities that award
monopoly contracts, the companies that execute them, and
the families that pay the price.
The FCC should craft a regulatory solution that is based on a
comprehensive view of the prison phone industry, taking into
account each of the components that contribute to
customers’ high bills, including fees.
The report urges the Federal Communications
Commission to:
1. Impose reasonable rate and fee caps that apply to all
prison and jail telephone calls;
2. Ban commission payments in all prison and jail
telephone contracts on the grounds that such
payments necessarily lead to inflated calling rates and
incentivize pernicious fee-collecting practices;
3. Ban all illegitimate fees in the prison and jail phone
industry; and

4. Audit legitimate fee collection by prison phone
companies to ensure compliance with FCC policy.
Additionally, the report recommends that state and local
contracting authorities take measures of their own to rein in
the cost of phone calls from jails and prisons.
County sheriffs, county contracting authorities, and
other state prison systems should:
1. Refuse to accept commissions from telephone
companies;
2. If commissions will be accepted, ask the companies
hard questions about how their fees are determined
before awarding a contract to ensure that fees are fairly
assessed and that income that should be subject to the
commissions is not hidden as a “fee”;
3. Refuse to contract with any company that is not fully
transparent about how fees and commissions are
calculated.

TABLE OF CONTENTS
FOREWORD	

1

INTRODUCTION	

2

THE PRISON PHONE MARKET IS BROKEN	

3

BRINGING JAILS INTO FOCUS	

4

COMMISSIONS DRIVE COSTS	

5

TACKING ON FEES TO RECOUP THE COMMISSION 	
REVENUE	

6

Profiting on prepayment
Profiting on calls that are never made
• Making money on holding customers’ money
• Making fast money on emergency calls
• National: 38 cents on every prison phone dollar may be going to fees
•
•

CLOUDING TRANSPARENCY TO MAXIMIZE REVENUE 	
FROM DISEMPOWERED CONSUMERS	

10

Collecting fees under the guise of taxes
Gleaning revenue from faulty “features” and bad customer service
• Charging the highest rates for calls to mobile phones
•
•

LACK OF REGULATORY OVERSIGHT	

14

RECOMMENDATIONS	

15

APPENDIX	

17

•

Questions for sheriffs and contracting authorities to ask of bidders for phone
contracts

TABLE OF EXHIBITS	

19

ENDNOTES	

21

FOREWORD
After we wrote “The Price to Call Home: State-Sanctioned
Monopolization In The Prison Phone Industry,” our report
about the exorbitant rates charged for phone calls from state
prisons, we received some helpful feedback from an
unexpected source: criminal defense attorneys.
In our first report on the prison phone industry, we focused
on the three companies that dominate the market for calls
from state prisons, and addressed the perverse conflicts of
interests inherent in the preparation and writing of these
contracts. We showed how contracts are awarded not to the
telephone company that charges the lowest rates or best
service, but to the company that offers to share the largest
portion of the call revenue with the prison system. This
drives up the cost of a call, serves as a stealth government
tax, and removes any incentive for state prison systems to
advocate for lowering the phone bills of the families, friends,
and attorneys who need to receive calls from incarcerated
people.
The defense attorneys we spoke to, however, pointed out that
calling rates from county jails are often even higher than
those from state prisons. They described shocking billing
practices that cause the actual call charges to be far higher
than the nominal published rates. Upon investigation, we
learned that these were not isolated examples, but rather the
tip of an iceberg that we aim to expose in this report.
We felt it particularly important to produce this report now,
as a growing number of states are banning commissions and
the Federal Communications Commission is considering a
proposal to cap the rates charged for phone calls from
correctional facilities. The telephone companies filed their
original objections and concerns,1 and a reply period closed
in late April.
We urge state regulators, local contracting authorities, and the
Federal Communications Commission to take a
comprehensive view of the prison telephone industry.
Capping the calling rates is essential; but leaving the fee
structure untouched would allow the dominant companies in
the industry to, with the stroke of a pen, instantly restore
their monopoly profits at the consumers’ expense.
Peter Wagner
Executive Director
Prison Policy Initiative
May 8, 2013

1

INTRODUCTION
Making it harder for incarcerated people to stay in touch with
people outside prison and jail harms incarcerated people,
their families and communities, and society at large.
Affordable phone calls are directly related to the safety and
well-being of all communities because communication
reduces the likelihood that incarcerated people will commit
another offense after their release.2 This uncontroversial
proposition has been endorsed by Congress,3 the American
Bar Association,4 the American Correctional Association,5
the federal Bureau of Prisons,6 state legislatures,7 and state
regulatory agencies.8 Unfortunately, opportunities for
government and private profit from prison telephone calls
are clouding out this common-sense principle, and
communities are suffering to fill the phone industry’s coffers.
Speaking to each other over the phone is a lifeline for
incarcerated people and their families,9 but maintaining such
a relationship is almost impossible when the cost of phone
calls is outrageously high. Table 1 illustrates that a brief 15minute phone call from a prison or jail often costs more than
$1710 — a disturbing anomaly in the era of unlimited longdistance plans for only $52.99 a month.11 The bills for prison
phone calls are not borne by incarcerated persons;12 almost
all calls emanating from correctional facilities are either
collect calls or are pre-paid by family members on the outside
who have set up an account with a private telephone
company.

Company
AmTel

Surcharge
(per call)
not disclosed

Per minute
not disclosed

Total for 15
minute call
not disclosed

Global Tel*Link

$4.95

$0.89

$18.30

ICSolutions

$4.99

$0.89

$18.34

Infinity

$3.95

$0.89

$17.30

Lattice

$3.95

$0.89

$17.30

Legacy

$4.99

$0.89

$18.34

NCIC

$3.95

$0.89

$17.30

Pay Tel

$3.00

$0.85

$15.75

Securus

$4.99

$0.89

$18.34

Telmate

not disclosed

not disclosed

not disclosed

Turnkey Corrections

not disclosed

not disclosed

not disclosed

Table 1. Highest Interstate Rates disclosed in tariffs filed by the prison
telephone companies with the FCC or with state regulators. Despite
FCC requirements to publish rates on their websites, we were not able to
locate the filings for three companies. Sources: See endnote 10 and
exhibits 8, 34-37, 39-40, 42-44.
the telephone bills charged to people with incarcerated loved
ones to astronomical levels.
While the push to bring down the cost of staying in touch
has been an ongoing struggle for decades,16 some
policymakers have realized that the price to call home need
not be so staggering. Indeed, several states have attempted to
bring down prison telephone charges. For example, eight
states and the District of Columbia do not accept
commission payments in telephone service contracts for
certain correctional facilities.17

Several unique and deliberate features of the prison phone
industry* lead to these prices. First, each prison system or
local jail enters into an exclusive contract with a telephone
company, granting that telephone company a monopoly in
the state prisons or at the local jail.13 Second, in all but a few
locations, the telephone companies are contractually
obligated to pay a large portion of the revenue collected back
to the correctional facility, thereby increasing the per-minute
calling rates.14 Such kickbacks are known as “commissions.”15
Third, in order to collect revenue to make up the money lost
to commissions, prison telephone companies add hefty
charges through multitudes of extra fees that often nearly
double the price of a call. These fees — the vast majority of
which do not exist in the ordinary telephone market — drive

Notable limitations and deficiencies in these welcomed
reforms persist, though. For example, California phased out
commission payments to its state prison system, but the
legislation did not affect local jails, as evidenced by the 56%
commission in Contra Costa County and the 72%
commission in the Solano County’s contract.18 Furthermore,
as the New Mexico Public Regulatory Commission has noted,
state legislatures and regulatory agencies are limited to reining
in exorbitant phone costs only in their own states. Finally, a
proliferation of new fees charged by phone companies is
impeding efforts to reduce phone bills. National rate caps will
be ineffective at protecting consumers when the industry is
free to create additional fees out of thin air.

* This report is the first to include an in-depth analysis of the
companies that concentrate on one corner of the correctional
telephone market: local jails. But for simplicity’s sake, this report will
continue to use the term “prison phone industry” as a generic term
to encompass these companies. Separate from that phrase, we’ll use
the criminal justice terms of art “prison”, “jail”, and “correctional
facility” where that specificity is relevant.

Fortunately, the one entity with the ability and technical
expertise to address this problem — the Federal
2

Communications Commission — is seriously considering
bringing much-needed and much-called for reform to the
prison telephone industry.19 This report illuminates the
interconnected array of rates and fees charged by the
exploitative prison telephone industry, illustrating why
comprehensive reform is necessary to provide relief to the
people who are forced to pay exorbitant prison phone
bills.20 21 22 23

people and their families lack comparable substitute methods
of communication.27 State-granted monopolies coupled with
no comparable alternative forms of communication
necessarily create a prime opportunity for exorbitant prices.

THE PRISON PHONE MARKET IS
BROKEN

Commission payments are an inherent component of nearly
all prison phone contracts, magnifying the price of prison
phone service. State prison systems and local jails generally
award contracts to the telephone company that promises the
highest commission payments, with little regard for the
corresponding increase in the rate charged to the consumer.28
Consequently, high commission payments lead to high perminute calling rates.29

The current structure of the prison phone market guarantees
exorbitant phone bills. In an ordinary market for goods or
services, consumers have the freedom to select the best seller.
In the prison phone market, though, state and local
government entities grant monopolies to telephone
companies by entering into exclusive contracts.24 The actual
consumers of the telephone service — the families of
incarcerated persons — have no input on the contracts or
ability to take their business elsewhere. As Commissioner Ajit
Pai of the Federal Communications Commission (FCC)
explained, “choice and competition are not hallmarks of life
behind bars. Inmates cannot choose among multiple carriers
for lower rates. Instead, prison administrators select the
service provider, and their incentives do not necessarily align
with those who are incarcerated.”25 Indeed, consumers’
interests are often disregarded by the telephone companies.26
This abuse is further exacerbated by the fact that incarcerated

Commissions also contribute to a second and more
camouflaged consequence: fees. As Securus, the second
largest prison telephone company, suggests, phone
companies design their revenue structure to compensate for
the revenue loss caused by commissions.30 Because telephone
companies pay up to 84% of call revenue back to the
correctional facility or Department of Correction,31 they
consequently impose exorbitant additional fees to recoup this
revenue. While the fees carry a variety of official-sounding
names, all drastically increase the cost of talking on the
phone with someone in prison or jail. Therefore, merely
examining the per-minute calling rates leads to an incomplete
understanding of the source of prison phone service
revenue. The FCC must look at the whole picture in order to
create regulations that lead to a well-functioning market that
controls the total costs that consumers pay for calls from
prisons and jails.

WHAT IS THE WRIGHT PETITION?
In 2000, a group of plaintiffs brought a class action lawsuit
against the Corrections Corporation of America and
several prison phone companies, alleging that the prison
phone agreements between the parties violated, among
other things, federal anti-trust law. The federal district
court in Washington, D.C. referred the case to the Federal
Communications Commission (FCC), stating that the FCC
was the appropriate government body to address the
concerns raised in the lawsuit.20 The plaintiffs then
petitioned the FCC to enact regulations that would
introduce competition to the prison phone market in the
hopes of lowering prison phone rates by breaking up the
monopolistic industry. 21 The petition to the FCC came to
be known as the Wright Petition, after original named
plaintiff Martha Wright. In 2007, and after several years of

little movement from the FCC, the plaintiffs amended
their request, asking the FCC to impose price caps of
$0.20 - $0.25 per minute for interstate long-distance rates.23
In late December 2012, the FCC published a Notice of
Proposed Rulemaking (NPRM) regarding the Wright
Petition.24 In sum, this Notice sought more information
concerning the prison and jail telephone industries from
the companies that provide such service. The public and
involved parties submitted initial comments during the
first 60 day comment period, and then had 30 additional
days to submit reply comments. The final reply comment
period ended on April 22, 2013. The FCC must now
decide how to proceed.

3

BRINGING JAILS INTO FOCUS

sentences for more “serious” crimes.32 There are 1.6 million
people in state or federal prison, serving an average sentence
of 28 months in state prison and 32.9 months in federal
prison.33 About 669,000 people are admitted to prison every
year.34

While most discussions about the need for federal regulation
of the prison phone industry have focused on state prisons,
the fact that a vast number of people pass through jail
systems every year makes it essential to consider how the
prison phone industry impacts this population as well.
Broadening discussions about the prison phone industry to
also include the impact on jails makes it clear that the number
of people victimized by high telephone rates and fees is far
higher than previously understood. (For simplicity, we will
continue to use the phrase “prison phone industry” to refer
to the companies in this market, even if they also service jails
and other kinds of correctional institutions. In this contextual
section only we’ll use the terms ‘prisons’ and ‘jails’ separately
as technical criminal justice terms.)

Local jails, on the other hand, process a larger number of
people and hold them for a shorter period of time. About
60% of the jail population is awaiting trial, and is comprised
of people who are either detained because they have just
been arrested and have not yet raised bail, or because they are
unable to raise bail and are being detained until their trial.35
Less than 40% of people in jail have been convicted, the vast
majority of which serve less than a year.36 While the
population of state and federal prisons is more in flux than
the public and most policymakers assume, the turnover in
local jails is even higher.37 On any given day, there are
approximately 735,000 people in 3,283 local jails.38 According
to the Bureau of Justice Statistics, almost 12 million people
cycle through the jail system each year.39 40 41 42 43

Prisons and jails are conceptually and operationally distinct,
with different management and oversight systems. A single
national cap on rates and fees as proposed by the Wright
Petition would benefit all of these facilities, although for
different reasons. As a general introductory matter, it is
important to consider the range of different incarcerated
populations that must call loved ones on the outside.

Finally, while some evidence suggests that rates (if not fees)
for telephone calls from state prisons are dropping, it is
becoming clearer that both rates and fees in jails are rising,
making jails the new frontier for telephone profits.44

Prisons are generally run by the state or federal government
and hold people who have been convicted and are serving

WHY DOES THE NATIONAL SHERIFFS’ ASSOCIATION
OPPOSE PRISON PHONE REGULATION?
The National Sheriffs’ Association, the
leading non-corporate voice opposing
prison phone regulation, is self-described
as “a nonprofit organization dedicated to
raising the level of professionalism among
sheriffs, their deputies, and others in the
field of criminal justice and public safety so that they may
perform their jobs in the best possible manner and better
serve the people of their cities, counties or jurisdictions.”39

the organization proudly highlights efforts in 2009 to
“block harmful measures … including … attempts to
change the existing inmate telephone system.”42
Aside from protecting the income from the phone
kickbacks, the Sheriff ’s Association has another reason to
support the prison phone industry’s fight against FCC
regulation: protecting corporate sponsorships. Leading
prison phone companies are some of the top donors to
the National Sheriffs’ Association. Global Tel*Link, PayTel Communications, and the Keefe Group (the parent of
ICSolutions,which handles CenturyLink’s prison phone
business) are all “platinum” corporate partners and
Securus is a “gold partner.”43

In its capacity as “the one voice of the nation’s sheriffs in
Washington D.C.,” the National Sheriffs’ Association has
made opposing prison phone industry regulation a top
priority. Indeed, multiple years of the Association’s annual
reports highlight the lack of progress towards federal
prison phone regulation as one of the Association’s
selected top lobbying victories of the year.41 For example,

4

COMMISSIONS DRIVE COSTS

It is essential for the FCC to step in and regulate the growing
costs of calls from jails because every year a vast number of
people pass through local jails with decentralized
administration and limited oversight. Given the sheer number
of distinct local jail systems around the country, the federal
government is the only agency that can provide effective
oversight of the facilities’ contracts with phone
providers.45 46 47

There is no longer any doubt that the commission system
drives the high bills that the family members and friends of
incarcerated people must pay to stay in touch, and the
problem is only getting worse. Market leader Global Tel*Link
admits, “as a general trend, that the size of commissions have
increased substantially”48 over the last decade. The highest
commission we know of is in Baldwin County, Alabama,
where ICSolutions agreed to pay 84.1% back to the country,
guaranteeing an average commission of “$55.00 per inmate
per month.”49 Calls from this jail cost $0.89 a minute plus a
$3.95 connection charge, which is less than the maximum
reported in state tariffs for this company as shown in Table 1,
suggesting that some counties receive an even higher
commission.
CenturyLink provides the FCC with two anecdotes from
Michigan and South Carolina that show how eliminating
commissions led to an immediate drop in the rates: “The
reason for these outcomes is straightforward. In order to
cover the significant up-front and ongoing fixed costs
incurred in these contracts, higher calling rates were
necessary when the payment of site commissions was
required by the facilities.”50 In turn, these higher calling rates
deter family communication.51

LOCAL JAILS SHOULD FOLLOW STATE PRISONS
BY REFUSING COMMISSION PAYMENTS
To our knowledge, eight state prison systems and only one
local jail — in Dane County, Wisconsin — refuse
commission payments in order to make their calling rates
more affordable. All local jails and state prison systems
should follow their lead.

jeopardizing public safety, the operation of their facilities,
or the continued existence of a phone system.
Many sheriffs and state Department of Corrections officials
argue that commission revenue is warranted because the
money is used to pay for programs related to rehabilitation
and care. But the choice of expenditure does not justify the
method of revenue collection. Paying for rehabilitation and
basic needs is one of the core costs of incarcerating
people,47 not an “extra” charge for local governments to
transfer to the families of incarcerated persons via
exploitative telephone bills.

In 2007, Dane County Commissioners voted to ban the
kickbacks that brought in nearly $1 million per year.
County Supervisor Dave de Felice explained the county
was “addicted to this money.” Recognizing the inherent
conflict of interest, he stated, “We’ve lost our moral
compass and direction for a million bucks a year.” 46
Several state prison systems around the country
(California, Nebraska, New Mexico, Missouri, Michigan,
Rhode Island, South Carolina, and New York) and the
District of Columbia have also already banned
commission payments in their phone contracts without

Finally, to the extent that money from the phone bills is
kicked back to the local government or jail, these bills are
effectively an additional government tax levied upon the
families of incarcerated persons. If a local government
wishes to impose such a tax, it should do so through the
ordinary legislative channels — not by stealthily colluding
with private telephone companies.
5

While the prison phone companies like Global Tel*Link
complain in their Wright Petition filings that “correctional
facility customers routinely refer to rates in the same breath
as commissions,”52 our review of the correctional facilities’
requests for proposals and the resulting contracts across the
country reveal that the commission payment is the only term
that is seriously negotiated.

people who pay for calls. Telmate’s Wright Petition filing, for
example, says that “financial commission payments are but a
small portion of the services, equipment and benefits …
required by correctional systems from their ICS [Inmate
Calling Services] partners.”56
Examples of additional services prison phone companies can
be contractually obligated to provide include:

For example, Gwinnett County, Georgia selected Global
Tel*Link’s Offer #1 over the company’s very similar Offer
#4, which differed only in a slightly lower commission and
far lower phone charges. Before making a final decision, the
County requested Global Tel*Link’s last and final offer, and
the company then sweetened the deal by increasing the
commission in Offer #1 to 65%.53 (See Table 2.)

• Unrelated computer equipment. All 5 of Global
Tel*Link’s offers to Gwinnett County, Georgia
mentioned above include “Two (2) new laptop
computers”57
• “Free” phone calls. Some contracts, particularly those
with local jails, require the phone companies to provide
some phone calls at no charge to certain individuals.
Telmate says that “free calls alone comprise a hefty
21% of all call minutes and 30% of calls from county
correctional facilities.” In county facilities, these free
calls would predominantly if not exclusively be a part
of jail procedures related to booking. These calls
should be subsidized by state and local governments,
not prison phone companies that must then
compensate for the lost income by overcharging for all
other calls.

Cost for 15
Per
minute
Commission
Surcharge minute collect call
callCommission income
Offer 1

$4.84

$0.89

$18.19

64%

$11.64

Offer 4

$2.00

$0.15

$4.25

58%

$2.47

Final Offer
(Contract) $4.84

$0.89

$18.19

65%

$11.82

Table 2.Global Tel*Link offers and final contract with Gwinnett
County, Georgia. Source: Exhibit 3.
We found many similar examples of commissions driving the
decision to award contracts to the detriment of other factors,
including:

As market-leader Global Tel*Link aptly stated: “Put simply,
there is no free lunch.”58 The kickbacks, via explicit
commissions and payments-in-kind, are driving up the costs
for the phone companies and, as a result, for consumers.

• St. Louis County, Missouri, awarded the contract to
ICSolutions because the company gave the county the
highest commission, 73.1%. In the county’s scoring
system used to weight multiple factors and pick the
winning bid, the commission was clearly the most
important factor. Under the 100 point scoring system,
the company with the highest commission was
awarded 30 points. By contrast, having the lowest cost
to the public was worth no more than 10 points and
the company with the greatest “experience and
viability” could be awarded up to only 20 points.54

TACKING ON FEES TO RECOUP THE
COMMISSION REVENUE
The increase in commission payments is directly related to
another significant burden for the people who pay prison
phone bills: fees, which can easily double the cost of a single
telephone call, and can add 50% to the phone bills charged to
the families that receive more frequent calls.59

• Macomb County, Michigan received bids from 6
companies for three- and five-year contracts. Of the
twelve combinations, the county chose the
combination that gave them the highest commission:
78.5%. The county asked about “additional fees
charged” in the request for proposals, but this was not
a visible factor in the decision.55

In the decade since the original Wright Petition was filed,
prison phone companies have trumpeted that they are
reducing the cost to consumers by gradually shifting from
collect calls to a prepaid call system. An examination of the
fees charged for pre-paid calls disproves that conclusion,
however, and raises serious concerns that capping the rates for
calls but leaving the industry free to set their own fees would
not in fact bring relief to consumers facing high bills.

Kickbacks increasingly include other complex payments-inkind beyond a percentage share of the call charges that, like
cash commission payments, come at the expense of the
6

One of the reasons that fees are so profitable to prison
phone companies is that fee income is exempt from the
phone companies’ commission responsibilities, as the major
phone providers have illustrated in their FCC filings. Pay-Tel
explained, for example, that “commissions are only paid on
call revenue — not on fees, which are collected for the
benefit of the ICS [Inmate Calling Service] providers
alone.”60 Securus further points out how the fees help to
compensate for the expense of the commissions, saying that,
“[t]he significance of site commissions to the company can
also be seen in the amount of ICS revenue that Securus must
earn in order to pay for these costs.”61 And Global Tel*Link
tells correctional facilities upfront in its contract bids that, for
the purposes of determining net profits after the loss of the
commissions, the payment fees are “cost recovery in nature
and are not considered revenue.”62 While the industry
disputes without evidence the Wright Petitioners’ calculations
of the true cost of providing telephone services from a
prison,63 it remains a simple mathematical fact that when the
commissions consume the majority of the cost of a phone
call, there is comparatively little room for telephone company
profit.64 By tacking on additional fees, the prison phone
industry has created a new profit source that is safely out of
reach of the commission system.
To be sure, businesses in many industries incur some
processing costs by accepting credit or debit cards in person,
via the internet, or over the telephone.65 Businesses usually
respond by setting minimum purchase levels for a take out
food order, charging a slightly higher rate per gallon of
gasoline, or by simply writing it off as the cost of doing
business. But this section of the report suggests that prison
telephone companies may be approaching the question from
the other end: providing telephone services in order to make
money by charging extra fees. Indeed, because the
commission system reduces the potential for corporate profit
from the telephone calls, fees that should be no more than
supplemental income are turned into a central source of
profit.

Company
AmTel

Website
$6.95

Global
Tel*Link

$4.75-$9.50 $4.75
(automated),
$9.50 (live
operator)

$10.95

ICSolutions

Up to $6.95 $4.79-$8.95

$5.50

Infinity
Networks
Lattice

$4.95

not offered $10.00

$9.95

$0

Legacy

$1.50

$6.00

As high as
$3.95

NCIC

not offered Up to $6.75

$9.95

$0

Pay Tel

$3.00

$3.00
(automated),
$5.95 (live
operator)

$5.95

$0

Securus

$7.95

$7.95

$11.95

$0

Telmate

As high as We were
$5 + 30.5% quoted
higher fees
than website
payments,
but lower
taxes.
$8.00
$8.00

Turnkey
Corrections

Phone
$10.00

Western Union
Additional
Western
Phone
Union Fee Company Fee
$9.95
$0

$4.95

$1.50

$0

As high as
$6.95

not offered

not offered

not offered

Table 3. Payment charges by method. Sources: Exhibit 26. For
Telmate, see the discussion surrounding Table 7 and Table 8.
open accounts,67 the prison telephone industry charges
additional fees for the simple “service” of accepting the
customer’s money. As the following table illustrates, these
fees can be substantial regardless of whether the transactions
take place via the internet, the telephone, or Western Union.
(See Table 3.) The companies charge up to $9.50 to pay over
the internet, up to $10 to pay by phone and up to $12.45 to
pay via Western Union.
Many prison phone companies have designed their systems
and rules to maximize the collection of fees. TurnKey
Corrections, AmTel, and ICSolutions structured their
payment systems to maximize the number of small payments
made with a fixed high “convenience” fee. TurnKey will
accept up to $400 in a one-month period, but only allows
individual deposits of up to $150, each with an $8 deposit
fee.68 Similarly, AmTel will accept up to $250 per week, but
charges $6.95-$10.00 to make a maximum individual payment
of up to $100,69 and ICSolutions will accept $275 per month,
but charges $6.95 to make a payment of up to $50.70
TurnKey makes it clear that it intends to facilitate frequent

Previous discussions about prison phone industry regulation
have briefly mentioned the “ancillary” fees66 that often
appear on phone bills, but the wide range of fees and the
sheer volume of the charges merit individual treatment. This
section provides an overview of the industry’s hidden fees,
covering prepayment fees, refund fees, account fees, and
single call fees.

Profiting on prepayment
The prison phone industry wastes no time in subjecting the
consumer to a barrage of fees. After charging initial fees to
7

small payments with accompanying high fees by asking the
purchaser, during the online payment process to “Please enter
today’s amount,” followed by an advertisement for a TurnKey
smartphone money deposit app that encourages even more
on-the-go payment fee generation.71

that the payment fees are intertwined with the rates: payment
fees are prohibited by Global Tel*Link’s contract with the
Massachusetts Department of Correction, but the phone
company’s computer system couldn’t waive the fees for just
Massachusetts, so the company cut the rates by an equivalent
amount. Massachusetts valued the cost of the deposit fees at
19%.77

Prison phone companies’ relationships with payment
companies also offer opportunities to rake in revenue from
high charges that disproportionately burden low-income
families that do not have bank accounts.72 Western Union
fees, for example, vary from $5.95 to $11.95 for no apparent
reason other than to act as a stealth profit center for the
phone companies. The differences between the charges are
initially confusing, but informative upon investigation. Four
observations each suggest that Western Union is sharing a
portion of its fees with the prison phone companies:

Profiting on calls that are never made
When someone is released from prison or jail, families
welcome the chance to reconnect. But this event is a chance
for prison telephone company profiteers to celebrate as well
by either seizing the balance left over in a phone account or
charging customers hefty fees to recoup their own money.
As Table 4 shows, the charge to refund money can be as
much as $10, and prison phone companies have a wide range
of policies about if, how, and when a customer can claim his
or her funds. While a few companies claim that money can be
left in an account indefinitely, most seize the funds within a
few months after release.78 Generally speaking, the larger
companies have the most restrictive policies. Depending on
the source, Telmate either charges the highest refund fee
($10), or bars refunds as a matter of policy, and Global

• Western Union is consistently charging consumers far
more to send payments to the prison telephone
industry than it does for payments elsewhere. The fee
to send payments to most other companies ranges
from $1.50-$3.00.73
• There is tremendous diversity in how much the
Western Union charges. Western Union charges only
$5.50-$6.00 to send payments to Pay-Tel, ICSolutions,
and Legacy, although both ICSolutions and Legacy
charge an additional fee to accept the payment from
Western Union. Three prison telephone companies
demonstrated that it is possible for a prison phone
company to negotiate a lower fee from Western Union.

Company
AmTel

• Of the three companies where the fee charged by
Western Union is relatively low, two companies charge
an additional payment fee that entirely erases the
savings to the customer.74
• Western Union charges the customers of Global
Tel*Link and Securus — the prison phone market
leaders — the highest rates. It strains all credible belief
to think that Global Tel*Link, a company that brags in
its most recent FCC filing that, as “one of the largest
providers in the market, it has economies of scale and
efficiency that enable [it] to pay high commissions …
[and simultaneously] charge lower rates,”75 somehow
lacks sufficient negotiating power to ensure that
Western Union does not force Global Tel*Link
customers to pay higher-than-average fees.76

Global Tel* Link $5.00

90 Days

ICSolutions

Infinity Networks $5.00

6 Months, unless otherwise
required by state law.
12 Months

Lattice

$0, if balance is over
$5.00

6 Months

Legacy

$0 to withdraw, $5.00 12 Months
charge to close the
account officially.

NCIC

$2.00-6.75, plus $10/ 3 Months
month inactive account
fee
$0
Never, automatic refund after 6
months
$4.95 (no refund if
180 Days
account balance is less
than $4.95)

Pay Tel
Securus

Finally, prepayment fees are a significant burden on
consumers even where they are not permitted. Massachusetts
provides a prime example where Global Tel*Link conceded

Fee
Time before balance is forfeit
$0 if balance is over $5, 12 Months
otherwise no refund

$2.99

Telmate

“processing fee of $10 Never/After 60 days, can call
may apply”
and get get the money back in
the form of a check 6-8 weeks.
Before then, can get the credit
card or prepaid card.

Turnkey
Corrections

n/a

On release. “There is no cash
value for the inmate upon
release”

Table 4. Refund policies, For sources, see Exhibit 27. (Telmate provides
very contradictory information on refund policies.)
8

Company
AmTel

Tel*Link has one of the shortest deadlines to claim unused
funds before they are seized.79
Immigration detainees pay particularly high price for these
refund policies, as detained immigrants are often transferred
between facilities and funds for telephone use in one facility
will not work if the second facility uses a different company.
Community Initiatives for Visiting Immigrants in
Confinement (CIVIC) aptly discusses this problem in its
Wright Petition Comments to the FCC.80

Global Tel*
Link

Fee
LEC Billing Cost Recovery Fee
Direct Billing Cost Recovery
Fee
Printed Statement Fee

Amount
$2.49/month
$1.50/month

Federal Regulatory Cost
Recovery Fee

$3.49/month for collect
calls, up to 8%/call for
prepaid calls
$0.50/call
$3.49/month
4% of base rate/call

Public Telephone Surcharge
Single Bill Fee
Validation Surcharge
ICSolutions

Bill Statement Fee
Federal Cost Recovery
Surcharge

Up to $2.49/month
3.2%/call

Infinity
Networks

Public Telephone Surcharge
Single Bill Statement Fee
Regulatory Assessment Fee
Wireless Administration Fee

$0.50/call
$2.95/month
$1.95/month
$1.99/month

Lattice

Bill Statement Fee
Federal Cost Recovery
Surcharge

$2.95/month
6.1%/call

Legacy

Bill Statement Fee
Carrier Cost Recovery Fee
Network infrastructure Fee
Non Subscriber Fee
Payphone Surcharge
Premise Impose Fee
Prepaid Wireless Fee

$2.50/month
$1.95 or 2.50/month
$2.50/month
$0.00-7.50/call
$0.56/call
$3.00/call
$9.99/call for calls lasting
15 min or less, additional
fee for longer calls
$1.95/month

Making money on holding customers’ money
The prison phone industry’s embrace of prepaid calling
means that the phone companies enjoy the convenience of
not having to worry that their low-income customers may not
be able to pay their bills. While paying interest or a giving a
discount might be an appropriate way to thank consumers for
paying in advance, the industry instead charges additional fees
on top of the high telephone rates simply for keeping the
prepaid account open.
Table 5 summarizes a sampling of the monthly charges
disclosed by the prison telephone industry in official filings,
which can add more than $12 to the final monthly bill. These
charges are clearly not the entire universe of recurring
account fees. For example, Infinity charges “up to $1.99/
month” if one or more wireless numbers are added to the
account. Infinity’s wireless number fee is not disclosed in the
published tariffs, but rather is revealed only after a customer
creates an account with the company. Similarly, Global
Tel*Link reveals on its website — but not in the tariffs we
reviewed — that it charges $2.50 for each paper statement.81

Regulatory Compliance Fee
NCIC

Billing Cost Recovery Fee
Regulatory Cost Recovery Fee

Regulatory Assessment Fee

$2.95/month
$0.95 plus 10% of the
price of the call,
excluding taxes and fees,
not to exceed $3.50 per
call.
$0.15 plus 17% of the
current Federal Universal
Service Fund Surcharge,
excluding taxes and fees.
$1.99/month

Pay Tel

Bill Processing Fee

$2.45/month

Securus

Bill Processing Charge
Billing Statement Fee
Federal Regulatory Recovery
Fee
USF Administrative Fee
Wireless Administration Fee

$1.49/month
$3.49/month
$3.49/month

Bill Statement Fee
Carrier Cost Recovery Fee
Regulatory Assessment Fee

$2.95/month
$2.50 at 1st and 5th call
$0.99 at 1st and 5th call

Federal USF Cost Recovery Fee

Making fast money on emergency calls
The prison telephone industry has found a new way to offer
expensive collect calls to vulnerable consumers in difficult
situations without relying on the recipients’ phone companies
to process collect call payments: charging expensive single call
fees.
Before such a call can be connected, the recipient must first
agree to either have a $9.99 to $14.99 “premium message”
charged to their cellphone, or to pay that amount by credit or
debit card.82

$1.50/month

Telmate

$1.00/month
Up to $2.99/month

Table 5. Charges disclosed in tariffs filed by the prison telephone
companies with the FCC or with state regulators. Sources: See Exhibit
48.

Such “single call programs”83 are particularly attractive to jails
— facilities that generally process a high volume of
individuals who are detained for only a brief period of time
while making arrangements to secure bail or bond. Single call
programs are also often used when an incarcerated person
needs to call someone who may not already have a prepaid
9

account, or someone whose phone provider does not already
have a billing relationship with the prison phone company.84

Applying the fees charged by industry-leader Global Tel*Link
to the national market, in Table 6 we produce the first ever
estimate of the amount that the families of incarcerated
people spend on phone fees every year: $386 million.88

Determining the prevalence of these “single call” programs is
difficult because they were not disclosed in any of the tariffs
that we reviewed on phone service provider websites. That
omission may be standard in the industry, as neither of the
two places where the practice received the most public
attention — Securus’s program in Chicago85 and Telmate’s in
Alabama86 — are disclosed in the relevant state tariffs. In any
event, it is well established that the practice of “single call
fees” is common in the industry, as one company observes in
their most recent FCC filing that “many” prison phone
companies operate such programs.87

That’s 38 cents on the dollar that could be going to actual
phone calls or other important needs that instead lines the
corporate pockets of the prison phone industry.

CLOUDING TRANSPARENCY TO
MAXIMIZE REVENUE FROM
DISEMPOWERED CONSUMERS
Beyond charging high rates and fees, there are a number of
practices that the prison telephone industry uses to maximize
profits while discouraging oversight and informed consumer
consent. Some practices might be illegal and many are
unethical, but all are good for the corporate bottom line.
Here we review three such practices: collecting fees under the
guise of taxes, using allegations of prohibited three-way calls
as a revenue source, and arbitrarily charging more for calls
made to cellphones.

National: 38 cents on every prison phone dollar
may be going to fees
The kickbacks, high rates and hidden fees in the prison
phone industry add up to real expenses for consumers, who
are primarily concentrated in the low-income communities
that can least afford such expenses.

Prepaid prison phone market (90% of $1.2 billion prison
phone market according to Bloomberg BusinessWeek)
Prepayment fees (19%)
Amount left after payments
Call fees
Validation Surcharge (4%)
Federal Regulatory Cost Recovery Fee (8%)
Monthly charges
$3.49 Single bill charges for 2.3 million incarcerated
people, per year

Annual amount
$1,008,000,000
$191,520,000
$816,480,000

Amount left for calls (and commissions) after all fees

Collecting fees under the guise of taxes
While preparing the tables about deposit fees and recurring
fees, we discovered two disturbing phone company practices.
First, many of the company fees charged to consumers are
given misleading offical-sounding names, and second, that
Telmate’s practice of collecting fees on deposits raises a series
of questions about the true purpose of these fees.

$32,659,200
$65,318,400

$96,324,000
$622,178,400

As shown in account fees section above, all prison telephone
companies charge fees for having accounts. Many of these
fees are disguised by official-sounding names, but the
majority (if not all) do not appear to be actually required by
the government. (See Table 7.)

Table 6. Estimates of the amount of fees collected by the prison phone
industry by applying the fees charged by Global Tel*Link to the entire
market. Sources: see footnote 88.

Fees consume 38% of the $1 billion spent
each year on calls from correctional facilities

To be sure, some of these fees represent real assessments
made by the federal government. None, however, are
required to be passed on to consumers. “Although not
required to do so by the government,” the FCC notes on its
website, “many carriers choose to pass their contribution
costs [to the Universal Service Fund] on to their customers in
the form of a line item.”89 Other companies, including some
companies in the prison phone industry, clearly choose to
absorb this particular government assessment and write it off
as a cost of doing business. Many of the other fees, based on
their titles and justifications described in Exhibit 26, could be
summarized as “the legal costs of complying with the law.”

Single Bill Fee
Federal Regulatory
$96million
Cost Recovery Fee $
65
m
Validation Surcharge
ill
$32
mil ion
l
io n

Prepayment Fees

lion
$192mil

Amount spent
on calls
& commissions
$622million

10

Fee
Carrier Cost Recovery Fee
Federal Cost Recovery Surcharge
Federal Regulatory Cost Recovery
Fee
Federal Regulatory Recovery Fee
Federal USF Cost Recovery Fee
Network Infrastructure Fee
Regulatory Assessment Fee
Regulatory Cost Recovery Fee
USF Administrative Fee
Validation Surcharge
Wireless Administration Fee

It immediately becomes clear that the fees are a substantial
portion of every payment, but four additional factors each
independently suggest that these are arbitrary company fees
and not mandatory government taxes:

Cost
$1.95/month, $2.50/month or $2.50
at 1st and 5th call
3.2%/call,6.1%/call
$3.49/month for collect calls, up to
8%/call for prepaid calls
$3.49/month
$0.15 plus 17% of the current
Federal Universal Service Fund
Surcharge, excluding taxes and fees.
$2.50/month
$1.95/month, $1.99/month, $0.99 at
1st and 5th call
$0.95 plus 10% of the price of the
call,
$1.00/month
4% of base rate/call
$1.99/month

• Telmate already charges for some of these fees on a
monthly basis (Carrier Cost Recovery Fee $2.50-$5/
month, and a Regulatory Assessment Fee of $0.99$1.98/month), which raises concern that the company
may be collecting these arbitrary fees twice: once on
deposit in advance, and then again each month. (See
Table 5 for Telmate’s monthly fees.)
• On the receipt page that appears after making a
payment, Telmate lists the entire charge as “Regulatory
Fees,” and then in an asterisk says, “Fees include local,
county, state and federal surcharges, as well as
mandatory regulatory assessments.” Telmate does this
even if the deposit fee is the majority of the
assessment.91

Table 7. Some of the fees with official sounding names from Table 5
Tariffed Account Fees. For a detailed list of each fee by company and
the rationale offered by each company for the fee, see Exhibit 48.
We note that no company outside of the monopoly context
would tell consumers that simply complying with the law
carries an extra charge.

• The discrepancies between counties in the same state
suggest that the “taxes” are negotiated profit, not
government fees. For example, people making deposits
in Fillmore County, Nebraska are charged “local,
county, state and federal surcharges, as well as
mandatory regulatory assessments” of 8%, but in
Buffalo County, Nebraska, it’s 30.5%. The difference
could be that Buffalo County (population 46,690) taxes
phone calls more aggressively than almost any other
locality serviced by Telmate, but the more likely
explanation is that deposit fees were negotiated down
to $0.50 in Buffalo but Fillmore County has the more
typical deposit charge of $5.95.

Ideally, the FCC will choose to regulate all of these fees. But,
at a minimum, the FCC could start by auditing Universal
Service Fund recovery fees collection to ensure that
consumers are not paying the companies more than the
companies are paying to the Universal Service Fund.
The fact that Telmate collects these charges as part of the
prepayment process, however, requires additional comment.
Telmate combines these fees with the deposit charge, and
then, on the receipts given to consumers, claims that the
entire fee is of a regulatory or tax nature. There is no
disclosure of the individual “local, county, state and federal
surcharges and regulatory assessments.” Because Telmate
considers prepayment non-refundable, government agencies
should question whether the collected “taxes” are turned over
to the government when unused balances are forfeited to
Telmate.90

• Telmate gave us different rate and “tax” quotes on two
occasions, but the overall charge came out to the exact
same amount. When we called Telmate to inquire
about the charges to make a payment by credit card
over the phone to Fayette County, Texas, we were
quoted a different fee and a different “tax” that

Ironically, Telmate provides an ideal case study of the
importance of fee transparency: The company’s website
offers a handy calculator for the fees added to a $20 deposit
to each facility they serve, but when we put all of the
different fees together in a list, we were left with even more
questions about the nature of these fees. Table 8 contains a
sampling of the jurisdictions that contract with Telmate for
telephone service (and, in some cases, for the occasionally
parallel business of providing inmate commissary
management), a list of the fees and taxes charged, and then
our calculation of the effective fee percentage on a $20
payment.

Deposit

Fee

“Taxes”

Total Additional Charge

$20 via phone $6.40
$20 via website $5.00

$4.70
$6.10

$11.10
$11.10

$40 via phone $7.80
$40 via website $5.00

$9.40
$12.20

$17.20
$17.20

Table 9. Telmate deposit and “tax” fee quotes by payment
method. While there is no conceivable reason why the “taxes”
would vary by payment method,it is worth noting that the total
costs come out the same regardless of payment method. Source:
Exhibit 49.
11

State
AL
AL
AL
AZ
CA
CA
CA
CO
CO
GA
GA
GA
FL
FL
ID
ID
ID
IN
IN
IN
IN
KY
KY
KY
KY
KY
MT
MT
MT
MT
MO
MO
NE
NE
NE
NE
NV
NV
NJ
NM
NY
OK
OK
OK
OR
OR
OR
OR
OR
OR
OR
SC
TX
TX
TX
TX
TX
TX
UT
UT
UT
UT
WA
WA
WA
WA
WY
WY

Facility
Albertville PD
Arab Police Department
Boaz City
Santa Cruz County Jail
Carl F Bryan Juvenile Hall (Nevada Co) CA
Fremont Detention Facility CA
Nevada County CA
Douglas County
Yuma County Jail CO
Miller County Jail GA
North Georgia Detention Center
Seminole County, GA
Broward, FL
Krome, FL
3B Juvenile Detention Center ID
Ada County Jail ID
Caribou County ID
Hamilton, IN
Hamilton County CC
Whitley County Jail IN
Whitley County Jail IN
Carter County Detention Center KY
Carter County Detention Center KY
Jessamine County Detention Center KY
Lewis County Detention Center KY
Lewis County Detention Center KY
Dawson Correctional Facility (County)
Dawson Correctional Facility (State)
Gallatin County, Mt
Montana State Prison
Greene County Jail MO
Wentzville Police Dept MO
Buffalo County, NE
Buffalo County, NE
Fillmore County NE
Sarpy County Jail NE
Nye County, NV
Nye County, NV
Elizabeth, NJ
Otero
Buffalo
Beckham County OK
Delaware County Jail
Delaware County Jail
Baker County, OR
Baker County, OR
Coos County Jail OR
Curry County Jail OR
Curry County Jail OR
Deschutes County Adult Jail OR
Deschutes County Adult Jail OR
Chester County Detention Center SC
Aransas
Aransas
Austin County TX
Bandera, TX
El Paso
Fayette County
Uintah County, UT
Sanpete County, UT
Sanpete County, UT
Sevier County Jail UT
Chelan County WA
Chelan County WA
Skagit County, WA
Thurston County Corrections WA
Albany County, WY
Sheridan County WY

Deposit Type
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
detainee calls
prepaid calls
detainee calls
detainee calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
prepaid calls
trust
prepaid calls
trust
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
prepaid calls
trust
detainee calls
detainee calls
detainee calls
prepaid calls
prepaid calls
trust
prepaid calls
trust
prepaid calls
prepaid calls
trust
prepaid calls
trust
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
detainee calls
prepaid calls
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
trust
prepaid calls
prepaid calls
prepaid calls
prepaid calls

Flat fee
$0
$0.50
$0.50
$5.95
$4.95
$5.95
$4.95
$6.95
$5.95
$0.50
$0.50
$0.50
$0.50
$0.50
$5.95
$5.95
$5.95
$5.95
$0.50
$5.95
$5.95
$5.95
$5.95
$5.95
$5.95
$5.95
$5.95
$0.00
$5.95
$0.00
$1.00
$5.95
$0.50
$5.99
$5.95
$0.50
$0.50
$5.99
$0.50
$0.50
$0.50
$0.50
$2.00
$2.00
$4.95
$5.99
$4.95
$1.95
$2.95
$5.95
$5.95
$5.95
$0.50
$2.00
$0.35
$0.50
$0.50
$5.00
$5.95
$5.95
$4.95
$5.95
$5.95
$5.95
$4.95
$0.50
$5.95
$5.95

Percentage fee
29.5%
32.5%
29.5%
9.0%
9.0%
8.8%
9.0%
9.0%
9.0%
32.5%
7.0%
32.5%
7.0%
7.0%
9.0%
9.0%
9.0%
9.0%
30.5%
8.0%
9.0%
9.0%
9.0%
9.0%
9.0%
9.0%
8.5%
0.0%
5.0%
0.0%
7.0%
8.5%
30.5%
9.0%
8.0%
32.5%
30.5%
9.0%
7.0%
7.0%
7.0%
29.5%
5.0%
5.0%
9.0%
9.0%
0.0%
5.0%
5.0%
9.0%
9.0%
9.0%
33.5%
10.0%
33.5%
30.5%
7.0%
30.5%
9.0%
8.0%
9.0%
20.0%
8.5%
9.0%
9.0%
30.5%
9.0%
8.5%

Fee charged on $20
deposit
$5.89
$6.99
$6.39
$7.75
$6.75
$7.70
$6.75
$8.75
$7.75
$7.00
$1.90
$7.00
$1.90
$1.90
$7.75
$7.75
$7.75
$7.75
$6.60
$7.55
$7.75
$7.75
$7.75
$7.75
$7.75
$7.75
$7.65
$0.00
$6.95
$0.00
$2.40
$7.65
$6.60
$7.79
$7.55
$7.00
$6.60
$7.79
$1.90
$1.90
$1.90
$6.40
$3.00
$3.00
$6.75
$7.79
$4.95
$2.95
$3.95
$7.75
$7.75
$7.75
$7.20
$4.00
$7.05
$6.60
$1.90
$11.10
$7.75
$7.55
$6.75
$9.95
$7.65
$7.75
$6.75
$6.60
$7.75
$7.65

Effective percentage
added to $20 payment
29.45%
34.95%
31.95%
38.75%
33.75%
38.50%
33.75%
43.75%
38.75%
35.00%
9.50%
35.00%
9.50%
9.50%
38.75%
38.75%
38.75%
38.75%
33.00%
37.75%
38.75%
38.75%
38.75%
38.75%
38.75%
38.75%
38.25%
0.00%
34.75%
0.00%
12.00%
38.25%
33.00%
38.95%
37.75%
35.00%
33.00%
38.95%
9.50%
9.50%
9.50%
32.00%
15.00%
15.00%
33.75%
38.95%
24.75%
14.75%
19.75%
38.75%
38.75%
38.75%
36.00%
20.00%
35.25%
33.00%
9.50%
55.50%
38.75%
37.75%
33.75%
49.75%
38.25%
38.75%
33.75%
33.00%
38.75%
38.25%

Table 8. A sampling of the fees charged by Telmate to process payments made on their website, along with a calculation of the effective fee added to each
$20 payment. In general, Telmate charges a higher deposit fee when the “local, county, state and federal surcharges, as well as mandatory regulatory
assessments” are lower, and a lower deposit fee when the “local, county, state and federal surcharges, as well as mandatory regulatory assessments” are
higher. But there are exceptions at both extremes, such as high flat fees and high percentage charges in the Sevier County (Utah) Jail and low flat fees and
no percentage charge in Coos County Oregon, or no fees and no surcharge at12Dawson Correctional Facility in Montana. Source: Exhibit 50.

produced exactly the same charge. Rather than the
fixed $5 fee of the website, we were quoted $6.40 for a
$20 payment, and $7.80 for a $40 payment. We were
quoted a tax of $4.70 or $9.40, respectively, for these
payments, which comes to 23.5%, less than the 30.5%
“local, county, state and federal surcharges, as well as
mandatory regulatory assessments” charged on the
website. (See Table 9.)

background noises such as “squeals of … young
children,”97 or “cymbals being hit in the
background,”98 as well as normal call circumstances
such as using a cordless phone99 or having static on the
line.100
• Telmate goes a step further by turning violations of
prison rules against three-way calling and call
forwarding into a revenue source. When the system
detects a three-way call, it is flagged for review, and if
the company determines that the recipient engaged in
a three-way call, the account is charged a $25 fee that
translates into direct profit for Telmate.101

Gleaning revenue from faulty “features” and bad
customer service
Monopoly contracts allow phone companies to find ways to
turn poor service into direct profit. One example is the
misuse of legitimate facility security rules banning
unapproved 3-way conferencing92 as an excuse to drop calls,
and require customers to pay new connection fee to call back
and resume the conversation. Prison phone companies hotly
dispute the implication that they deliberately drop calls to
increase revenue, but the companies cannot credibly claim
that their self-interest is in making sure that the security
procedures are not triggered inappropriately.

Global Tel*Link’s solution to the problem of dropped calls is
to blame the consumer. Global Tel*Link’s advice on how to
avoid the problem is unreasonable and contradictory both in
their formal submission to the FCC in response to the Wright
Petition and in a brochure available to customers. The FCC
submission states:
“To avoid dropped calls, GTL advises its customers
that call recipients should use landline telephones
and, if they must use wireless telephones, to avoid
talking in areas with prevalent background noise.”102

This controversy is a quintessential illustration of the
misaligned incentives in the prison telephone market: The
prison systems contractually require certain security
procedures, and the phone company implements them. Even
assuming that phone companies never maliciously drop calls
just to generate a new connection fee, there is simply no
incentive under the contracts to take any action to minimize
— or even monitor — mistaken detections of three way
calls.93

The brochure to customers demands:
“DON’T stop the conversation for any length of
time, even short pauses may result in
disconnection”103
Such admonitions are unreasonable and impractical. For
example, consider the near-universal practice of setting a
phone down in order to retrieve another person to speak to
the caller. Now imagine a child picking up the phone, talking
to his or her incarcerated parent, and then setting the phone
down for a brief amount of time while he or she brings a
sibling or other parent to the phone. This completely benign
action can easily trigger the prison phone companies’ threeway detection system, thereby ending the call and forcing the
family to pay reconnect fees.

Indeed, the record reflects that the industry is prioritizing its
interests and that of the correctional facilities over the people
who pay the bills:
• In Florida, the prison telephone companies refused to
cooperate with an investigation of alleged improper
dropping of calls. Facing a potential in $6 million in
refunds and $1.3 million in fines, the companies hid
documents and delayed proceedings for years. This
case was ultimately settled for $1.25 million in
exchange for not “finding any guilt or liability on the
part of TCG or GTL [Global Tel*Link]…”94

On the other hand, there is evidence that one telephone
company and some prison systems follow a guideline that is
both more ethical and more conducive to a secure facility:
flagging — but not dropping — calls. We note that
CenturyLink reports that “[b]ecause of the potential for
mistakes, all but one of CenturyLink’s customers requires
flagging the call record within the database, but not
disconnecting the call in progress.”104 Notably, CenturyLink’s
single client that requires disconnection upon detection of a

• In Pennsylvania, T-Netix, now owned by Securus,95
failed to make any effort to refund multiple connection
charges or even investigate inmate complaints96 when
their system disconnected calls based on ordinary
13

three-way call does not charge a connection fee, so there is no
risk of inappropriate costs or profits.105
Local Prepaid

As long as the prison phone industry can rake in a profit
from providing poor service to consumers, the phone
companies have no incentive even to monitor the quality of
their service, let alone compensate consumers for undue
disruptions and the accompanying charges. While we expect
the phone contracts to require the companies to provide
security staff with recordings of suspected three way calls,106
dropping calls should not be allowed to serve as an
unaccountable revenue source.107 Perhaps the Pennsylvania
Public Utility Commission said it best in the Yount v. T-Netix
case previously cited:

Per
Connect minute Average Average
charge cost
talk time charge
$2.20
$0
12 minutes $2.20

Local Prepaid $3.00
call charged at
Long Distance
rate

$0.40

9 minutes

$6.60

Commission
income
$1.06
$3.17

Table 10. Comparison of the cost of local prepaid call from the
Ramsey County Minnesota jail with the same call to a local cellphone
that is then charged as if it were long distance. Source: See endnote
111.

Difference in
connect charge,
per call

“We are troubled that T-Netix did not regard the
inmates as customers, even when their calls were
paid for using the inmates’ prepaid accounts…

Difference
between local
Monthly
Monthly
and long
calls &
consumer commission
distance rate minutes
cost
income
$0.80 connect 1,823 calls
$1,458.40
$700.03
fee

Difference in per $0.40 per
minute charge
minute
Total

While the erroneous disconnections themselves are
difficult for the inmates, the fact that T-Netix has
done little or nothing to investigate complains or to
make refunds, when appropriate, is
unacceptable.”108

16,386
minutes

$6,554.40

$3,146.11

$8,012.80

$3,846.14

Table 11: Rerating calls means additional monthly income for
ICSolutions and additional commission income for Ramsey County,
Minnesota. Source: Exhibit 51 and endnote 111.

Ramsey County, Minnesota show that the company is
exercising this “right” to arbitrarily re-rate calls at great cost
to consumers. The company’s monthly commission report to
Ramsey County shows 1,823 expensive “Intra-cell” minutes
in December 2012, but the origin as local calls is confirmed
by their presence in the “Total Local Prepaid” row of the
same report. These “Intra-cell” calls were local in nature but
were charged at the higher rate.113

Charging the highest rates for calls to mobile
phones
Some of the prison phone companies glean extra profit by
charging high out-of-state rates for calls to any cell phone,
rather than charging cheaper applicable in-state or local rates.
This practice can double or triple the cost of a call.
For example, the nation’s 5th largest cell phone company,109
MetroPCS, filed a comment with the FCC reporting that “at
least one ICS provider attempted to impose a surcharge on
phone calls that inmates made to wireless phone numbers in
an overly-broad and ill-conceived attempt to charge out-ofstate call recipients higher fees.”110

We calculate that the practice costs customers in Ramsey
County, Minnesota $8,013 per month, or $96,153 per year.114
(See Table 11.) As the contracting authority, the county would
be the obvious party to hold the phone company accountable
for creating this unnecessary cost to consumers. However,
the county is unlikely to object because the practice directly
translates into more than $46,000 a year in additional
commission revenue.

The “one ICS provider” MetroPCS was referring to was
industry giant Global Tel*Link, and, while the company
apparently postponed the rate increase,111 our investigation
found that at least one company currently profits from
charging high rates for calls to cell phones: ICSolutions.

LACK OF REGULATORY OVERSIGHT

In its published tariffs for Arkansas, Illinois, Indiana, Iowa,
Kentucky, Minnesota, Mississippi, Missouri, Ohio, Rhode
Island, South Carolina and Wyoming, ICSolutions states that
it “reserves the right to rate calls terminating to wireless
numbers at the applicable intraLATA [long distance] toll
rate.”112 An examination of the commission reports to

There is neither a central registry of the prison telephone
industry’s participants nor of official sanctions against the
companies, allowing abusive consumer treatment to go
unnoticed and unaddressed. For example, while producing
the fee tables earlier in this report (Tables 1, 3, 4 and 5), we
found it impossible to find rates filed by CenturyLink, a
14

Company
AmTel
CenturyLink
Global Tel*Link
ICSolutions
Infinity Networks
Lattice
Legacy
NCIC
Pay Tel
Securus
Telmate
Turnkey Corrections

Tariff available on website?
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
No

reported by CIVIC in their Wright Petition filing119: many
companies are reluctant to share rate and fee information
with consumers prior to accepting the consumers’ money.
CIVIC staff talked to Global Tel*Link six times before they
could receive fee information. We had similar experiences
when we researched the refund policies, and repeated phone
calls to the phone companies were met with different
information about charges, deadlines, required minimums
and the form that repayment could take. The lawyers and the
policy analyst who prepared this report repeatedly received
vague and contradictory answers from phone company
customer service representatives. We can give the prison
phone companies the benefit of the doubt that their intent is
not to deter requests for refunds, but the logical result of
inconsistent explanations will be to discourage consumers
from claiming their money.

Table 12: Not all prison phone companies make their rate tariffs
available on their website as required by FCC Rule 47 C.F.R.
42.10(b)..
company we previously identified as having enough contracts
to make it the third-largest player in the state prison
market.115 It turns out that CenturyLink subcontracts most of
its prison telephone business to ICSolutions, and another
portion to Securus. (Both subcontractor companies are
unrelated to CenturyLink.)116

RECOMMENDATIONS
Exorbitant prices for telephone service in the prison phone
industry are caused by the monopolistic nature of phone
service, the prevalence of commissions, and prison phone
companies’ ability to bring in additional revenue by tacking
on arbitrary fees. Until the Federal Communications
Commission enacts comprehensive regulations governing this
unique and exploitative industry, incarcerated persons, their
families, and the public at large will continue to suffer, while a
few telecommunications companies, prisons, and jails rake in
the profits.

CenturyLink’s failure to disclose its subcontractor
relationships should give the FCC pause when evaluating
CenturyLink’s claims that the prison telephone industry is a
“high fixed costs” business,117 as the profit margins on these
contracts must be high enough that other companies are
willing to do the actual work and share the profits with
CenturyLink.
This industry has problems with transparency on a very basic
level, such as complying with existing FCC requirements. For
example, we were unable to find tariff filings for three
companies on their websites, (See Table 12.) as required by
FCC Rule 47 C.F.R. 42.10(b), which states:

We note that some individual state prison systems have made
considerable progress to rein in the cost of a call home from
prison, and we believe that local governments should choose
to join that trend.

[A] nondominant IXC [interexchange carrier] that
maintains an Internet website shall make such rate
and service information specified in paragraph (a)
of this section available on-line at its Internet
website in a timely and easily accessible manner, and
shall update this information regularly.

County sheriffs, county contracting authorities, and
other state prison systems should:
1. Refuse to accept commissions from contracts with
prison telephone companies. (See sidebar on page 5,
“Local jails should follow state prisons by refusing
commission payments.”)

The lack of consistent federal oversight of this industry
means that even when systemic industry problems come to
light in particular states,118 they will continue to be unknown
to both consumers and policymakers and remain unsolved
nationwide.

2. If commissions will be accepted, before awarding a
contract, ask the prison telephone companies hard
questions about how their fees are determined to
ensure that fees are fairly assessed and that income that
should be subject to the commissions is not hidden as
a “fee.” (See suggested questions to ask in the
Appendix on page 17.)

This lack of transparency further burdens consumers who
seek to make informed decisions between the limited options
given by their assigned prison telephone provider. Our
experience producing the tables in this report mirrored that
15

3. Refuse to contract with any company that is not fully
transparent about how fees and commissions are
calculated.
On a national level, the broken and inefficient prison phone
market is in dire need of comprehensive federal regulation.
In our view, eliminating the commission system and
instituting proper oversight is the only way to ensure that, as
the Pennsylvania Public Utility Commission demanded, the
prison phone industry treat the people paying the bills as
their actual customers.120 Until the FCC acts, we can be sure
that the industry will continue to look solely to their partners
in contract and in profit — the jails and state prison systems
— for approval.
The Federal Communications Commission should not wait
any longer to bring its institutional expertise and regulatory
power to bear on this industry.

The Federal Communications Commission should:
1. Impose reasonable rate and fee caps on all prison and
jail telephone calls;
2. Ban commission payments in all prison and jail
telephone contracts on the grounds that such
payments necessarily lead to inflated calling rates and
incentivize pernicious fee-collecting practices;
3. Ban all illegitimate fees in the prison and jail phone
industry; and
4. Audit legitimate fee collection by prison and jail phone
companies to ensure compliance with FCC policy.
We urge the Federal Communications Commission to take a
comprehensive view of the prison telephone industry and
regulate both the rates and the fees. Capping the rates is
essential to protecting consumers; but the FCC must not
allow the industry to compensate for lost monopoly profits
by creating new fees.

16

APPENDIX:
QUESTIONS FOR SHERIFFS AND
CONTRACTING AUTHORITIES TO ASK
OF BIDDERS FOR PHONE CONTRACTS
WITH A CORRECTIONAL FACILITY

Please include a statement confirming that you do not have a
revenue sharing agreement with Western Union, MoneyGram
or similar companies, or include a statement disclosing the
amount of the revenue share and clarification as to whether
this revenue is subject to the commission.

This appendix suggests questions that sheriffs or contracting
authorities should ask bidders on correctional facility
telephone contracts to ensure that the county is aware of the
fees being charged by the vendor, therefore enabling the
county to evaluate fees along with the rates, and to ensure the
county is properly compensated for any revenue-generating
consumer fees that are charged by the vendor.

Please provide a statement as to whether or not you have
attempted to encourage Western Union, MoneyGram and
similar companies to lower their fees on payments sent to
your company, and listing the results of that effort.

Pre-payment of taxes?
Are any of your pre-payment fees related to the payment of
taxes to local, state, or federal authorities?

Fees charged and defining commissions
What fees do you charge pre-paid account holders and collect
call recipients? Please identify any fees charged for account
set-up, account funding, per-call or per-month charges, and
any fees or limitations on refunds or closing accounts.

If so, please describe in detail how you calculated the amount
to be charged during the pre-payment process. Please also
describe if and how taxes are paid if deposited funds are not
used to make calls.

Are commissions to be paid on these fees? If no, why not?

Monthly and per call charges not covered by
commission

Are the fees a revenue source for your company or are they
cost-recovery in nature?

For any monthly and per-call charges not subject to a
commission, please describe how you determined the amount
to charge callers and account holders.

If fees are cost-recovery in nature, please describe your
efforts to control those costs and the resulting fees.

Please disclose whether or not you would be willing to offer a
report at the end of each contract year that lists both the
amount generated from each of these fees or taxes under the
contract, and the cash payments made to federal, state or
local authorities or to other telecommunications companies
that are directly related to the disclosed fee or tax.

Fees/Commissions for “Single-Call” and similar
programs
If your bid includes a “single-call” system that allows a single
call to be accepted without requiring a preexisting account,
please disclose the charges for such calls by payment method
(text message, credit/debit card, etc.).

Unclaimed funds and refunds:

Please describe whether commissions are to be paid on this
fee.

When a person is released from custody or transferred to
another facility that does not contract with your company for
telephone services, can he or she get a refund of his or her
pre-paid account funds? Is there a charge imposed or a
deadline to request a refund?

Please describe your efforts to keep these charges to the
consumer as low as possible.

Do you accept payments via Western Union, MoneyGram or
similar money transfer services?

Please describe how you treat funds that are not refunded.
Are they turned over to the state unclaimed funds program?
If no, are commissions to be paid on that money?

If so, please list the fees charged by those companies to send
payments to your company.

Are you willing to provide monthly reports on the disposition
of unclaimed funds?

Western Union and money transfer services

17

Minimizing unnecessary connection charges:
Three-way calling and call forwarding can be a security
problem, but “false positives” that improperly disconnect
calls can raise the cost to consumers by requiring a new call
to be placed with a new connection charge. Does your bid
include technology to detect three-way or forwarded calls?
If so, does your bid include a connection charge?
If yes, does your technology give the correctional facility the
choice to determine, as a matter of policy, whether such calls
should be automatically disconnected, or merely flagged for
review by security staff ?
If the correctional facility wishes to have the calls
automatically disconnected, does your technology give the
correctional facility the choice to prohibit that number from
being immediately redialed? Please note that this question
inquires about the policy and security flexibility that your
technology will give our correctional facility and is not a
question about the accuracy of your technology.

Charging fair prices to mobile phones
Please detail your procedure for connecting to mobile
phones: If someone at the correctional facility calls a local
number that happens to be a cellphone, under your bid, will
he or she be charged different rate than if he or she were to
call a local landline?
If so, to further educate the county about the destinations of
calls from its facilities, would you agree to separately disclose
the number calls to cell phone and landlines, and the
aggregate number of minutes of such calls in your monthly
commission reports?

Publication of tariffs
Please include a statement that if you are awarded this
contract, your interstate phone tariffs will be published on
your website as required by the FCC.

18

TABLE OF EXHIBITS
All exhibits cited in Please Deposit All of Your Money are available at http://www.prisonpolicy.org/phones/exhibits.html
Exhibit
1

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16

Title
Petition of the Recipients of Collect Calls from Prisoners at Correctional institutions in Massachusetts Seeking Relief from the
Unjust and Unreasonable Cost of Such Calls - Before the Commonwealth of Massachusetts Department of
Telecommunications and Cable
ICSolutions Inmate Telephone Services Agreement with Baldwin County, Alabama
Global Tel*Link Contract and Response to RFP, RP034-11 for Gwinnett County, Georgia
St. Louis County, Missouri - Inmate Telephone Service Selection Criteria
Macomb County, Michigan - RFP, Bid Table, and Contract
A Phone Bill of the Prison Policy Initiative
Excerpts - Telmate’s response to RFP RP034-11 for an Inmate Phone System in Gwinnett County, Georgia
NCIC Interstate Tariff
Global Tel*Link Web FAQ
AmTel Website - Payment Options
Turnkey Corrections Online Deposit Form for an Inmate Canteen Account in Beltrami County, Minnesota
ICSolutions Online Payment Form - Western Union
Legacy Online Payment Form - Western Union
Western Union bill pay web interface for a selected range of companies
Examples of Global Tel*Link’s 19% rate
Comments Regarding the Generic Proceeding considering the Promulgation of Telephone Rules Governing inmate Telephone
Services for Telmate, LLC - Before the Alabama Public Service Commission (Docket No. 15957)

17
18
19
20
21
22
23
24
25
26
27
28

Collection of News Stories from WBEZ
Staff Memorandum - State of Florida Public Service Commission
Order Accepting Settlement Offer - Before the Florida Public Service Commission
History of Securus, Securus Webpage
Oregon Department of Corrections Web FAQ
Global Tel*Link Advance Pay Brochure
Excerpts - ICSolutions Tariffs for Multiple States
Georgia Public Service Commission, In Re Application of Legacy - Order
California Public utilities Commission - Order Instituting Investigation
Sources for Table 3 (Payment Fees)
Sources for Table 4 - Refund Policies
Order Regarding the Generic Proceeding considering the Promulgation of Telephone Rules Governing inmate Telephone
Services for Telmate, LLC - Before the Alabama Public Service Commission (Docket No. 15957)

29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48

Global Tel* Link Contract with Solano County, California
Online Chat with Western Union Representative
ICSolutions Web Payment Form
NCIC - Online Chat with Western Union Representative
Securus - Online Chat with Western Union Representative
AmTel Alabama Tariff
Global Tel*Link Interstate Tariff
ICSolutions Interstate Tariff
Infinity Networks Interstate Tariff
Infinity Networks - Online Account Wireless Fee Charges
Lattice Interstate Tariff
Legacy Interstate Tariff
Rates and Tariffs - NCIC Website
Pay Tel Interstate Tariff
Securus Interstate Tariff
Telmate Alabama Tariff
Telmate Web FAQ
Telmate Web Payment Form
ICSolutions Maximum Individual Transaction and Monthly Charge Amounts
Memo - Phone Fees and Justifications

19

49
50
51
52
53
54

Sources for Table 9 - Telmate deposit and “tax” fee quotes by payment method.
Telmate WebPhone call deposit interface and charge confirmation page for multiple jurisdictions
Addendum 1 to RFP-SHRF4070-12 for an Inmate Telephone System in Ramsey County, Minnesota
Telmate Web Inmate Phone Calls interface and charge confirmation page for Fillmore County, NE
Telmate Web Trust Fund interface and charge confirmation page for Chelan County, WA
Corporate Partners - National Sheriffs’ Association website

20

ENDNOTES

9

See Nancy G. La Vigne, Rebecca L. Naser, Lisa E. Brooks, &
Jennifer L. Castro, Examining the Effect of Incarceration and In-Prison
Family Contact on Prisoners’ Family Relationships, 21 Journal of
Contemporary Criminal Justice 314, at 323 (2005) (explaining that
the price of phone calls was one of most significant barriers to
family contact during incarceration). Note also that literacy rates for
incarcerated persons are lower than those for the general
population, and correctional facilities tend to impose restrictions on
incoming and outgoing mail. These facts make talking on the phone
one of the most effective way to maintain a family relationship. See
Elizabeth Greenberg, Eric Dunleavy, Mark Kutner, & Sheida White,
U.S. Dept. of Education Statistics, Literacy Behind Bars: Results
from the 2003 National Assessment of Adult Literacy Prison
Survey, at 29 (2007), available at http://nces.ed.gov/
pubs2007/2007473.pdf (literacy rates for incarcerated persons);
Leah Sakala, Prison Policy Initiative, Return-to-Sender: Postcard-Only
Mail Policies in Jail (2013) available at http://www.prisonpolicy.org/
postcards/report.html (discussing the rise of restrictive mail policies
in local jails).

1

One notable exception merits public notice: Verizon.
Representatives of Verizon/Verizon Wireless filed a must-read
comment with the FCC in which they speak as former participants
in the prison telephone industry, and as a company that truly
understands the importance of communication to a well-functioning
society. In their filing, they call on the FCC to regulate the prison
phone industry, noting the inherent corruption of the current
system: “In other words, the calling rates that the bidders will charge
the collect call recipients of the inmates appear to be irrelevant to
the process of selecting a provider; the bidder with the lowest
calling rates is simply not more likely to win the contract.” Verizon’s
filing makes it clear that the company rejects some prison phone
companies’ arguments that the commissions are justified because a
portion of the funds are used for rehabilitation purposes: “Verizon
understands that DOCs may use commissions to fund beneficial
inmate services that may not otherwise receive funding. But forcing
inmates’s families to fund these programs through their calling rates
is not the answer. Because higher rates necessarily reduce inmates’s
telephone communications with their families and thus impede the
well-recognized societal benefits resulting from such
communications, other funding sources should be pursued.”
Comments of Verizon and Verizon Wireless, In re Rates for Interstate
Inmate Calling Services, Before the Federal Communications
Commission, WC Docket No. 12-375 (March 25, 2013), available at
http://apps.fcc.gov/ecfs/document/view?id=7022134584.

10

Table 1 contains, with the exception of Legacy and NCIC, the
highest interstate rates we could identify in official state or FCC
filings, all of which are preserved in Exhibits 8, 34-37, 39-40, and
42-44. Legacy’s published rates were much higher, and a phone call
from Peter Wagner to Raphael of Legacy Regulatory Affairs
revealed on May 3, 2013 that many of the entries are incorrect, so
we excluded some contracts from consideration in the table. We
were told that Contract 5, for example, does not charge the “billing
fee” per-call but rather per-bill, and that the “premise impose fee”
implies that the contract is for a payphone, not a correctional facility.
Further, the Legacy representative said that the “connect live/
connect auto” options were not consistent with the choices in
Legacy’s correctional facility contracts. For that reason, we excluded
several contracts with listed surcharges as high of $9.66 plus
“premise impose” fees of up to $3.00 from the table.

2

See Nancy G. La Vigne, Rebecca L. Naser, Lisa E. Brooks, &
Jennifer L. Castro, Examining the Effect of Incarceration and In-Prison
Family Contact on Prisoners’ Family Relationships, 21 Journal of
Contemporary Criminal Justice 314, at 316 (2005). The humane
benefits of permitting family members to stay in touch with one
another should not be understated, either.
3

42 U.S.C. § 17501(b)(6).

Similarly, an interview with William Pope, president of NCIC by
Peter Wagner on May 6, 2013 revealed several errors in the NCIC
tariff (Exhibit 8), including old rates from payphone businesses, and
four rates where the per-minute and surcharges were reversed
resulting an apparent but incorrect $4.00/minute rate. Mr. Pope
told Peter Wagner that the tariffs would be corrected.

4

A.B.A., Crim. Jus. Sec., Report With Recommendation to the
A.B.A. House of Delegates 2 (2005), available at http://
www.americanbar.org/content/dam/aba/publishing/
criminal_justice_section_newsletter/
crimjust_policy_am05115b.authcheckdam.pdf. Many thanks to Ben
Iddings for bringing this resource to our attention.

Researchers following in our footsteps should note that the tariffs
require certain rates to be disclosed, but they do not require the
identification of the contracting parties using those rates.

5

American Correctional Association, Public Correctional Policies,
“Public Correctional Policy on Adult/Juvenile Offender Access to
Telephones 2001-1 (amended 2011)” at 76, available at https://
www.aca.org/government/policyresolution/PDFs/
Public_Correctional_Policies.pdf . This Policy Statement was
unanimously adopted in 2001, and was amended and endorsed in
2006 and 2011.

11

See, e.g., Verizon, available at http://www22.verizon.com/home/
phone/#callingplans (unlimited local and long-distance plan for
$52.99 per month).
12

6

28 C.F.R. § 540.100(a).

7

See, e.g., N.Y. Corr. Law § 623, Legislative Findings and Intent.

Some prisons allow incarcerated people to earn a nominal income
through work programs, but wages are exceedingly low. For
example, the federal prison system pays some of the highest wages
of between $0.23 to $1.15 per hour. See Work Programs, Federal
Bureau of Prisons, available at http://www.bop.gov/
inmate_programs/work_prgms.jsp. Some state prisons do not pay
wages at all.

8

New Mexico Public Regulation Commission, Resolution No.
12-0925 (Sept. 25, 2012).

21

13

25

Federal Communications Commission, Notice of Proposed
Rulemaking, at ¶ 5, In re Rates for Interstate Inmate Calling Services,
WC Docket No. 12-375, (released Dec. 28, 2012), available at
http://www.fcc.gov/document/rates-interstate-inmate-callingservices. In technical terms, this is called a “location monopoly.” See
also Paul R. Zimmerman & Susan M.V. Flaherty, Location Monopolies
and Prison Phone Rates, 47 Quarterly Review of Economics and
Finance 261, at 262 (2007).

Statement of Commissioner Ajit Pai, In re Rates for Interstate Inmate
Calling Services, WC Docket No. 12-375, available at http://
apps.fcc.gov/ecfs/document/view?id=7022093349.
26

See Jon E. Yount, AC-8297 et. al. v. T-Netix, Inc. and T-Netix
Telecommunications, Inc., Penn. Public Utility Commission, Docket
No. C-20042655, Opinion and Order.
27

See Paul R. Zimmerman & Susan M.V. Flaherty, Location
Monopolies and Prison Phone Rates, 47 Quarterly Review of Economics
and Finance 261, at 262 (2007).

14

See Federal Communications Commission, Notice of Proposed
Rulemaking, at ¶ 5, In re Rates for Interstate Inmate Calling Services,
WC Docket No. 12-375, (released Dec. 28, 2012), available at
http://www.fcc.gov/document/rates-interstate-inmate-callingservices. See also Ben Iddings, The Big Disconnect: Will Anyone Answer
the Call to Lower Excessive Prisoner Telephone Rates?, 8 N.C. Journal of
Law & Technology 159, at 175-76 (2006).

28

Federal Communications Commission, Notice of Proposed
Rulemaking, at ¶ 5, In re Rates for Interstate Inmate Calling Services,
WC Docket No. 12-375, (released Dec. 28, 2012), available at
http://www.fcc.gov/document/rates-interstate-inmate-callingservices.

15

See Ben Iddings, The Big Disconnect: Will Anyone Answer the Call to
Lower Excessive Prisoner Telephone Rates?, 8 N.C. Journal of Law &
Technology 159, at 162 (2006).
16

29

Comments of Global Tel*Link Corporation, at 11-12, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767.

See Iddings. at 172-3.

17

See John E Dannenberg, Nationwide PLN Survey Examines Prison
Phone Contracts, Kickbacks, 22 Prison Legal News 1, at 7 (2011).

30

Expert Report of Stephen E. Siwek, On Behalf of Securus Technologies,
Inc., In the Matter of Rates for Interstate Inmate Calling Services,
Before the Federal Communications Commission, WC Docket No.
12-375 (March 25, 2013), available at http://apps.fcc.gov/ecfs/
document/view?id=7022134786.

18

See Community Initiatives for Visiting Immigrants in
Confinement (CIVIC), Public Comment, In re Rates for Interstate
Inmate Calling Services, Before the Federal Communications
Commission, WC Docket No. 12-375, submitted March 21, 2013,
http://apps.fcc.gov/ecfs/document/view?id=7022134848 and
Exhibit 29, Global Tel*Link Contract with Solano County, California.

31

Exhibit 2, ICSolutions Inmate Telephone Services Agreement with
Baldwin County, Alabama.

19

Federal Communications Commission, Notice of Proposed
Rulemaking, In re Rates for Interstate Inmate Calling Services, WC
Docket No. 12-375, (released Dec. 28, 2012) available at http://
www.fcc.gov/document/rates-interstate-inmate-calling-services.

32

20

33

The definitional issues vary by state, but usually the line for
prisons is drawn at the offenses being “felonies” or the time
sentenced being at least a year. Often, however, these are the same
thing.

Martha Wright, et al. v. Corrections Corporation of America, et
al., Civil Action No. 00-293 (GK) (D.D.C. filed Aug. 22, 2001).

Bureau of Justice Statistics, US Department of Justice, Prisoners in
2011 (Dec. 2012), available at http://www.bjs.gov/content/pub/
pdf/p11.pdf; Sourcebook of Criminal Justice Statistics, Table
6.0027.2009, available at: http://www.albany.edu/sourcebook/pdf/
t600272009.pdf; Sourcebook of Criminal Justice Statistics, Table
6.58.2003, available at: http://www.albany.edu/sourcebook/pdf/
t6582003.pdf.

21

Implementation of the Pay Telephone Reclassification and
Compensation Provisions of the Telecommunications Act of 1996,
Petition of Martha Wright et al. for Rulemaking or, in the Alternative,
Petition to Address Referral Issues in Pending Rulemaking, CC Docket No.
96-128 (filed Nov. 3, 2003) (First Wright Petition).

34

Bureau of Justice Statistics, US Department of Justice, Prisoners in
2011 (Dec. 2012), available at http://www.bjs.gov/content/pub/
pdf/p11.pdf.

22

Implementation of the Pay Telephone Reclassification and
Compensation Provisions of the Telecommunications Act of 1996,
Petitioners’ Alternative Rulemaking Proposal, CC Docket No. 96-128
(filed Mar. 1, 2007) (Alternative Wright Petition).

35

Bureau of Justice Statistics, US Department of Justice, Jail Inmates
at Midyear 2011 – Statistical Tables (April 2012), available at http://
www.bjs.gov/content/pub/pdf/jim11st.pdf.

23

Federal Communications Commission, Notice of Proposed
Rulemaking, In re Rates for Interstate Inmate Calling Services, WC
Docket No. 12-375, (released Dec. 28, 2012), available at http://
www.fcc.gov/document/rates-interstate-inmate-calling-services.

36

Sourcebook of Criminal Justice Statistics Table 6.17.2011, available at
http://www.albany.edu/sourcebook/pdf/t6172011.pdf. The
definitional issues vary by state, but usually the line for jails is drawn
at the offenses being “misdemeanors” or the time sentenced being
less than a year. Often, however, these are the same thing.

24

Federal Communications Commission, Notice of Proposed
Rulemaking, at ¶ 5, In re Rates for Interstate Inmate Calling Services,
WC Docket No. 12-375, (released Dec. 28, 2012), available at
http://www.fcc.gov/document/rates-interstate-inmate-callingservices; see also Paul R. Zimmerman & Susan M.V. Flaherty,
Location Monopolies and Prison Phone Rates, 47 Quarterly Review of
Economics and Finance 261, at 262 (2007); Ben Iddings, The Big
Disconnect: Will Anyone Answer the Call to Lower Excessive Prisoner
Telephone Rates?, 8 N.C. Journal of Law & Technology 159, at 161.
22

37

44

Forty two percent of the state and federal prison population
changes in a year (In 2011 there were 668,800 admissions out of
1,598,780 people incarcerated in state or federal prisons), while the
jail population turns over about 16 times each year. Bureau of
Justice Statistics, US Department of Justice, Prisoners in 2011
(December 2012), available at: http://bjs.gov/content/pub/pdf/
p11.pdf and Bureau of Justice Statistics, US Department of Justice,
Jail Inmates at Midyear 2011 – Statistical Tables at 3 (April 2012),
available at http://www.bjs.gov/content/pub/pdf/jim11st.pdf.

Exhibit 1, Petition of the Recipients of Collect Calls from Prisoners at
Correctional Institutions in Massachusetts Seeking Relief from the Unjust and
Unreasonable Cost of Such Calls, at 27-29 and Appendix IV, Before the
Commonwealth of Massachusetts Department of
Telecommunications and Cable, (Aug.31, 2009) (showing that not
only are the surcharges at Massachusetts jails higher than those at
the Massachusetts prisons, but the surcharges at the jails are higher
than the vast majority of those charged by any company in any
other state’s prisons – Minnesota and Arkansas state prisons have
highest surcharges in the nation, and those are equal to the
surcharges in Massachusetts jails).

38

Bureau of Justice Statistics, US Department of Justice, Jails at
Midyear 2011 – Statistical Tables, available at http://www.bjs.gov/
content/pub/pdf/jim11st.pdf; Bureau of Justice Statistics, US
Department of Justice, Census of Jail Facilities, 2006 (December
2011), available at http://bjs.gov/content/pub/pdf/cjf06.pdf.

45

For example, consider the phenomenon described by CIVIC in its
public comment in a current FCC proceeding (Public Comment, In re
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375, submitted
March 21, 2013, http://apps.fcc.gov/ecfs/document/view?
id=7022134848). CIVIC notes that while California phased out
commissions in the state prison prison system, the legislation only
applied to the state prisons. As a consequence, persons incarcerated
in local and private facilities continued to pay high rates. The
effectiveness of California’s progressive prison phone legislation has
further been undermined as more people are funneled out of the
state prisons and into local jails as a result of the over-crowding
crisis in California’s state prisons.

39

“Local jails admitted an estimated 11.8 million persons during the
12 months ending midyear 2011, down from 12.9 million persons
admitted during the same period in 2010 and 13.6 million in 2008.
The number of persons admitted in 2011 was about 16 times the
size of the inmate population (735,601) at midyear 2011.” (Bureau
of Justice Statistics, US Department of Justice, Jail Inmates at Midyear
2011 – Statistical Tables, at 3 (April 2012), available at http://
www.bjs.gov/content/pub/pdf/jim11st.pdf .) The Bureau of
Justice Statistics defines “admissions” as “Persons are officially
booked and housed in jails by formal legal document and the
authority of the courts or some other official agency. Jail admissions
include persons sentenced to weekend programs and who are
booked into the facility for the first time. Excluded from jail
admissions are inmates re-entering the facility after an escape, work
release, medical appointment or treatment facility appointment, and
bail and court appearances.” (Id. at 13.)

46

Wisconsin County Bans Profiteering in Jail Phone Contracts,
Prison Legal News, July 2008, available at https://
www.prisonlegalnews.org/19901_displayArticle.aspx and citing The
Capital Times; Dane County, WI Ordinance Amend. No. 12,
2007-2008.
47

40

See Estelle v. Gamble, 429 U.S. 97, 104 (1976) (Supreme Court
holding that deliberate indifference to the serious medical needs of
incarcerated persons violates the Eighth Amendment.)

41

48Comments

National Sheriff ’s Association, History of NSA, available at
http://www.sheriffs.org/content/history-nsa
National Sheriffs Association, Annual Report 2007, at 4, available
at http://www.sheriffs.org/sites/default/files/tb/
AR_2007_final.pdf; National Sheriffs Association, Annual Report
2008 at 5, available at http://www.sheriffs.org/sites/default/files/
tb/AR_2008.pdf; National Sheriffs Association, Annual Report 2009
at 6, available at http://www.sheriffs.org/sites/default/files/tb/
AR_2009.pdf. The National Sheriffs’ Association also includes the
issue on the “NSA’s Position on Key Legislation” document in
multiple years. See e.g, NSA’s Position on Key Legislation, 11th Congress,
2nd Session (2010), available at http://www.sheriffs.org/sites/default/
files/tb/legislative/NSAPositiononKeyLegislation10-5-10.pdf and
NSA’s Position on Key Legislation, 11th Congress, 1st Session (2009),
available at http://www.sheriffs.org/sites/default/files/tb/
legislative/NSA_Position_on_Key_Legislation_12-1-09.doc .

of Global Tel*Link Corporation, at 10, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767; see also Comments of Telmate, at 7, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134863
49

Exhibit 2, ICSolutions Inmate Telephone Services Agreement with
Baldwin County, Alabama.
50

Comments of CenturyLink, at 15 In the Matter of Rates for
Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781 .

42

National Sheriffs Association, Annual Report 2009 at 6, available at
http://www.sheriffs.org/sites/default/files/tb/AR_2009.pdf .
43

Exhibit 54, Corporate Partners, National Sheriffs’ Association
website, available at http://www.sheriffs.org/content/corporatepartners .

23

51

61

See New York State, Department of Corrections and Community
Supervision, Inmate collect call phone rates reduced again (December 13,
2007) available at: http://www.doccs.ny.gov/PressRel/2007/
phoneratereduction.html. (Press release from New York prison
system explaining that after prison phone rate reduction call
volumes increased by 36%.) CenturyLink finds no connection
between call volumes and rates in local jails because of “short-term
detention inmate calls principally being more necessary than
discretionary -- e.g., securing bonding and defense
preparation.” (Comments of CenturyLink, at 11, In the Matter of Rates
for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781 .
We believe the FCC should find this admission of the necessary
basis of the calls relevant to their deliberations of what “reasonable
charges” as required by 47 U.S.C. § 151 mean in this context. See
also Comments of Telmate, at 12 available at http://apps.fcc.gov/ecfs/
document/view?id=7022134863.

Expert Report of Stephen E. Siwek, On Behalf of Securus Technologies,
Inc., at ¶4.8, In the Matter of Rates for Interstate Inmate Calling
Services, Before the Federal Communications Commission, WC
Docket No. 12-375 (March 25, 2013), available at http://
apps.fcc.gov/ecfs/document/view?id=7022134786 .
62

Exhibit 3, Global Tel*Link contract and response to RFP, RP034-11 for
Gwinnett County, Georgia, Exhibit A, GTL’s Proposed Account
Transaction and Cost Recovery Fees (page unnumbered).
63

We note that Global Tel*Link charges $.05 a minute with no
connection charge for local and long distance service in New York,
pursuant to a state law that directs the prison system to ban
kickbacks and requires that “the lowest possible cost to the user
shall be emphasized.” N.Y. Corr. Law § 623.
64

On the other hand, thanks in part to the fees, we note that the
industry isn’t struggling. Telmate told Gwinnett County Georgia
that, “[f]inancially, our company is extremely stable and has been
growing steadily, without debt.” Telmate reported unrestricted cash
of $7 million, and reported a 24% profit: income of $5.8 million on
revenues of $26.6 million. Exhibit 7, Telmate’s response to RFP,
RP034-11 for Gwinnett County, Georgia.

52

Comments of Global Tel*Link Corporation, at 13-14, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767

65

There is also a processing cost to handling paper checks, but
neither PayTel (according to their website at http://
www.paytel.com/paymentoptions.html) nor Global Tel*Link
(according to their Proposal to Gwinnett County, Exhibit 3) charge
a fee to pay via a paper check. However, Global Tel*Link’s website
at https://www.offenderconnect.com/help/
help.jsp#TypesofPayments (Exhibit 9) reports that payments under
$30 may be subject to a $5 fee. We did not actively investigate the
procedures for handling paper checks.

53

Exhibit 3, Annual Service Provider Contract: Provision of inmate Coinless
Phone Equipment at the Gwinnett County Comprehensive Correctional
Complex, at 1-16. The cost of a 15 minute call and the commission
income were calculated by the Prison Policy Initiative from the
offers and contracts.
54

Exhibit 4, Selection Criteria for an Inmate Telephone Service for St.
Louis County, Missouri

66

E.g., Comments of Martha Wright, et al., The D.C. Prisoners’ Legal
Services Project, Inc., Citizens United for Rehabilitation of Errants,
Prison Policy Initiative, and The Campaign for Prison Phone Justice,
at 24-25, In the Matter of Rates for Interstate Inmate Calling
Services, Before the Federal Communications Commission, WC
Docket No. 12-375 (March 25, 2013).

55

Exhibit 5, RFP, Bid Table, and Contract for Macomb County,
Michigan
56

Comments of Telmate, at 3-4, In the Matter of Rates for Interstate
Inmate Calling Services, Before the Federal Communications
Commission, WC Docket No. 12-375 (March 25, 2013), available at
http://apps.fcc.gov/ecfs/document/view?id=7022134863

67

For example, NCIC charges $4.95-$6.75 to establish a pre-paid
account. (Exhibit 8, NCIC Interstate Tariff at 54.10.1 ( Feb. 22, 2013).)

57

Exhibit 3, Annual Service Provider Contract: Provision of inmate Coinless
Phone Equipment at the Gwinnett County Comprehensive Correctional
Complex, at 6.

68

Elsewhere on their site they say the monthly limit is $500, but
$400 is cited in more places.

58

Comments of Global Tel*Link Corporation, at 24, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767

69

Exhibit 10, Amtel, Payment Options, http://
www.myphoneaccount.com/PaymentOptions.cfm.
70

See Exhibit 4, Selection Criteria for An Inmate Telephone Service for St.
Louis County, Missouri, at unnumbered page 6, containing notes
from a presentation by ICSolutions and noting the maximum
deposit amount of $50. For the maximum amount that can be
spent per month, see Exhibit 47, ICSolutions Maximum Individual
Transaction and Monthly Charge Amounts.

59

A vivid example, albeit in the collect call context, is Prison Policy
Initiative’s phone bill for March 2013, where a single nine-minute
collect call from a correctional facility on December 28, 2012
resulted in a charge of $5.57 in fees on top of the $11.96 for the
actual call. Fees raised the total cost to us to $17.53, or $1.95 a
minute. See Exhibit 6, Prison Policy Initiative Phone Bill.

71

See Exhibit 11, Turnkey Corrections, Inmate Canteen, online deposit
form.

60

Comments of Pay Tel Communications, Inc., at 16, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134799

72

For a discussion about the 1 in 4 U.S. households that do not keep
bank accounts, see Halah Touryalai, Who needs banks? Number of
Americans Without Bank Accounts Rises, Forbes, September 17, 2012,
available at: http://www.forbes.com/sites/halahtouryalai/
2012/09/17/who-needs-banks-number-of-americans-without-bankaccounts-rises/
24

73

79

Using the Western Union “Pay Bills” interface (available at:
https://wumt.westernunion.com/WUCOMWEB/
shoppingAreaAction.do?
method=load&nextSecurePage=Y&prop14=us_hmp_sendmoney_s
monestimateprice), we checked the fees charged by Western Union
to pay phone and electric bills to an assortment of companies.
While one company we checked had no fee for the bill pay, the
majority were between $1.50 and $3.00. See Exhibit 14, Western
Union, Bill pay web interface.

See Table 4. NCIC also has a shorter deadline than most
companies and separately charges $10/month once an account
becomes inactive. (See Exhibit 8 at Original Page 50.) Contrast those
facts with these two statements from pages 8-9 of their March 25
2013 filing in In the Matter of Rates for Interstate Inmate Calling
Services, Before the Federal Communications Commission, WC
Docket No. 12-375 at http://apps.fcc.gov/ecfs/comment/view?
id=6017169660: “NCIC has experienced, first hand, if the inmate
has the funds to make telephone calls, whether it is inmate debit,
commissary or pre-paid collect, they will utilize the available
balances. NCIC rarely experiences dropped call complaints, but as
part of our common practice, we credit back all or part of the
dropped call, which allows the inmate to make a subsequent call
with the same funds. NCIC maintains extremely low pre-paid collect
account fees, in order to maximize the usage of the account balance
for actual telephone calls…. NCIC feels very strongly that the FCC
could proactively and immediately help to reduce rates by as much
as 17% for the inmates by exempting inmate calling revenues from
the Universal Service Fund contribution. Studies document that
incarcerated individuals generally come from the lowest income
families, so exemption from the Federal Universal Service Fund tax
would substantially decrease their costs of calling and improve
billing and collections for providing these services.”

74

See Exhibit 12, ICSolutions, Online Payment Form; Exhibit 13, Legacy,
Online Payment Form.
75

Comments of Global Tel*Link Corporation, at 13, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767
76

We remind the reader that, for the purposes of determining net
profits — which are subject to commission payments — Global
Tel*Link declares in its bids that the payment fees are “cost recovery
in nature and are not considered revenue,” and explicitly says that
Western Union, not Global Tel*Link, charges a fee to send payment
via Western Union. (Exhibit 3, at 5 (pages unnumbered), Global
Tel*Link contract and response to RFP, RP034-11 for Gwinnett County,
Georgia.) If the FCC fails to immediately cap these fees, we suggest
that contracting authorities ask Global Tel*Link during the Request
for Proposals process whether Global Tel*Link’s contracts with
Western Union include revenue sharing or other similar
arrangements, and, as a result, whether the commission calculations
should be adjusted.

80

Community Initiatives for Visiting Immigrants in Confinement
(CIVIC), Public Comment, In re Rates for Interstate Inmate Calling
Services, Before the Federal Communications Commission, WC
Docket No. 12-375, submitted March 21, 2013, http://
apps.fcc.gov/ecfs/document/view?id=7022134848.
81

Exhibit 9, Help – Frequently Asked Questions, https://
www.offenderconnect.com/help/help.jsp.
82

Exhibit 16, Comments Regarding the Generic Proceeding considering the
Promulgation of Telephone Rules Governing inmate Telephone Services for
Telmate, LLC, Before the Alabama Public Service Commission,
Docket no. 15957 (Jan. 4, 2013), available at https://
www.pscpublicaccess.alabama.gov/pscpublicaccess/ViewFile.aspx?
Id=8286aadf-335d-4137-805a-0306d58ee84f ; Exhibit 17,
Collection of news stories from WEBZ.

77

Exhibit 1, Petition of the Recipients of Collect Calls from Prisoners at
Correctional institutions in Massachusetts Seeking Relief from the Unjust and
Unreasonable Cost of Such Calls, at 22-23, before the Commonwealth
of Massachusetts Department of Telecommunications and Cable,
Exhibit 3 (Massachusetts Department of Correction, Re: Advance
Pay Program Calling Rates, (June 4, 2007)), (Aug.31, 2009), available
at http://www.mass.gov/ocabr/docs/dtc/dockets/11-16/
inlpet83109.pdf. See also Exhibit 15.

83

We decided to use the term “single call fees” to describe this
phenomenon. We caution those who are doing follow-up research
that the terms used for this particular product vary.

78

If the FCC hasn’t banned these fees by August 2013 when law
students are picking topics for law review notes, we suggest an
article that does a 50 state review of whether state unclaimed funds
laws apply in this circumstance. That article would be most powerful
if it also collected information about whether the phone companies
are in fact turning assets over under these laws.

84

Comments of CenturyLink, at 17, In the Matter of Rates for
Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781.
85

25

See Exhibit 17, Collection of news stories from WBEZ.

In Fillmore County Nebraska, Telmate charges a flat fee of $5.95
for each deposit, plus 8%. On a $20 deposit, the total “regulatory
fee” is $7.55, even though the majority of that “regulatory fee” is
actually a deposit fee. See Exhibit 52. We note that Telmate also
claims a similar “regulatory fee” on inmate trust deposits. See
Exhibit 53, Telmate, Trust Fund web interface.
91

86

See Exhibit 28, November 6, 2012 Order for Alabama Public
Service Commission Docket 15957 (discusses concerns about $9.99
charges to AT&T cellphone customers accepting inmate calls and
recommends that the Commission seek comments “regarding the
“practice of entering into arrangements with intermediaries and/or
other telecommunication providers that result in IPS [Inmate Phone
Service] customers being billed for charges that exceed those
authorized” by the Commission); and Exhibit 16, Telmate Comment
Letter for Docket 15957 filed January 4, 2012, at 11 (Telmate
responded to the call for comments with a letter focused on other
issues raised in the Order and did not directly address the single call
charges, but the final page of the companies submission includes an
explanation of the “text collect” system that results in the single call
charges).

92

See e.g. 103 CMR 482.06(3)(b), (Code of Massachusetts
Regulations), available at http://www.mass.gov/eopss/docs/doc/
policies/482.pdf.
93

The Yount v. T-Netix decision (Penn. Public Utility Commission,
Docket No. C-20042655) includes a discussion of the fact that
repeated disconnects for attempted three-way calling were reported
to the Department of Corrections for disciplinary proceedings
against the incarcerated person. When the system malfunctions, this
could improperly impact parole decisions, but it also illustrates the
general point: If a single attempted three-way call was a security
problem for the institution, the contracts would prohibit such calls
from being re-dialed and the call would immediately be flagged for
review. Instead, broken systems for detecting three way calls are
tolerated because the two parties with legal standing to the contract
— the prison and the phone company — benefit financially from
that failure.

87

Comments of CenturyLink, at 17, In the Matter of Rates for
Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781.
Bloomberg BusinessWeek has estimated that the prison phone
industry does $1.2 billion in business every year. (Todd Shields,
Prison Phones Prove Captive Market for Private Equity, Bloomberg
BusinessWeek (October 4, 2012), available at http://
www.businessweek.com/news/2012-10-04/prison-phones-provecaptive-market-for-private-equity.) Considering the speed at which
pre-paid accounts are overtaking collect calls, we estimate that 90%
of the market is now in pre-paid accounts. We then applied Global
Tel*Link’s fee structure (as described in Tables 3 and 5) to the
revenue generated by pre-paid calls made from U.S. correctional
facilities in a year to produce Table 6. One assumption — that there
are 2.3 million monthly fees being charged, one for each person in
state or federal prison on any given day — may be a significant
undercount, because often several people will be in touch with the
same incarcerated person and each will require his or her own
account with the accompanying separate monthly fees. We note that
the industry is in a prime position to supplant some of our
assumptions with better data, but so far the industry in general, and
Global Tel*Link in particular, has refused to provide the FCC with
even more basic data (see, for example, Reply Comments of Martha
Wright, et al., The D.C. Prisoners’ Legal Services Project, Inc., Citizens
United for Rehabilitation of Errants, Prison Policy Initiative, and The
Campaign for Prison Phone Justice, at 8-9, In the Matter of Rates for
Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (April 22,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022289796).
88

94

Exhibit 18, State of Florida Public Service Commission, Staff
Memorandum, Re: Docket No. 060614-TC - Compliance investigation
of TCG Public Communications, Inc. for apparent violation of
Section 364.183(1), F.S., Access to Company Records, and
determination of amount and appropriate method for refunding
overcharges for collect calls made from inmate pay telephones, Sept.
8, 2008, available at http://www.psc.state.fl.us/library/FILINGS/
08/08284-08/08284-08.pdf; Exhibit 19, In re: Compliance
investigation of TCG Public Communications, Inc. for apparent
violation of Section 364.183(1), F .S., Access to Company Records,
and determination of amount and appropriate method for
refunding overcharges for collect calls made from inmate pay
telephones, Order Accepting Settlement Offer, Before the Florida Public
Service Commission, Docket No. 060614-TC (Aug. 31, 2009)
available at http://floridapsc.org/library/FILINGS/
09/08975-09/08975-09.pdf.
The companies obstructed the investigation by hiding documents, as
the Commission staff explained, “[t]hroughout this entire
investigation covering almost four years, staff was informed by
representatives of AT&T, Global, TCG, T-NETIX, or Evercom,
that call detail records did not exist for calls placed by inmates from
the Miami-Dade detention facilities.” And that “representatives of
each company assured staff that the call detail records were not
available and did not exist.” “At a much later date (late 2007), staff
received call detail records which were previously reported by the
parties as no longer in existence.” Staff Memorandum, at 6-8, 17.

89

Consumer and Governmental Affairs Bureau, Federal
Communications Commission, Sample Wireline Phone Bill, available at
http://transition.fcc.gov/cgb/phonebills/samplePhonebill.html.

95

Exhibit 20, History of Securus, available at http://
www.securustech.net/history.asp.

90

Although these fees are outside of the commission system, we
were surprised to discover no evidence of a contracting authority
auditing these fees charged against payments actually made to
regulatory agencies. If the FCC fails to regulate these fees, future
contracting authorities may wish to ask Telmate if it pays the “local,
county, state, and federal surcharges and regulatory assessments”
when an incarcerated person is released, the calls never made, and
the unused funds forfeit.

96

Yount v. T-Netix, at 12, Pennsylvania Public Utility Commission,
Docket No. C-20042655, Opinion and Order, (May. 1, 2008)
97

Yount v. T-Netix, at 55, Pennsylvania Public Utility Commission,
Docket No. C-20042655, Initial Decision, (Jan. 19, 2007).

26

98

Id. at 58

99

Id. at 61

100

109

Id. at 57

MetroPCS, Investor Relations, available at http://
investor.metropcs.com/phoenix.zhtml?c=177745&p=irol-IRHome.

101

Exhibit 21, Oregon Department of Corrections, FAQ, available
at http://www.oregon.gov/DOC/GENSVC/pages/faq-its.aspx.

110

Comments of MetroPCS Communications Inc., at 3, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/comment/view?
id=6017169649.

102

Comments of Global Tel*Link Corporation, at 30, In the Matter of
Rates for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134767.

111

MetroPCS discloses that GTL did withdraw or postpone the
rates in response to criticism from the industry, citing “E.g., In the
Matter of Tariff Filing by Global Tel*Link Corporation to Update
Check Sheet and Add Wireless Termination Surcharge Language,
Comments in Objection, New York State Public Service Commission,
Matter No. 11-00513 (filed Apr. 21, 2011); In the Matter of Global
Tel*Link Corporation Tariff Revision for Georgia Tariff No. 4 to
Add Wireless Termination Surcharge Language, Complaint and Petition
to Cancel Tariff, Georgia Public Service Commission, Docket No.
33710-U (filed May 11, 2011)”. (Comments of MetroPCS
Communications Inc., at 3 n.7, In the Matter of Rates for Interstate
Inmate Calling Services, Before the Federal Communications
Commission, WC Docket No. 12-375 (March 25, 2013), available at
http://apps.fcc.gov/ecfs/comment/view?id=6017169649.)

103

Exhibit 22, Global Tel*Link, Advance Pay Brochure, available at
http://www.gtl.net/documents/GTL_AdvPay_Eng.pdf
104

“The FCC asks for comment concerning inmates incurring
multiple per-call charges when calls are dropped after a pause in the
inmate’s conversation. (NPRM at 16642-43 ¶ 19.) In such situations,
dropped calls likely result from the operation of a feature intended
to detect attempts to initiate three-way conference calls. Three-way
conference calls are prohibited by facilities for security reasons.
Three-way conference call detection features use algorithms that
analyze a variety of data points (including prolonged periods of
silence in a conversation) to flag suspicious activities. The algorithms
are capable of mistakenly flagging benign activities and dropping
calls. Because of the potential for such mistakes, all but one of
CenturyLink’s customers requires flagging the call record within the
database, but not disconnecting the call in progress. CenturyLink’s
single customer that does require immediate termination of the call
is a state correctional system with per-minute-only calling
rates.” (Comments of CenturyLink, at 7 n.16, In the Matter of Rates
for Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781)
105

112

Exhibit 23, Excerpts of tariffs filed by ICSolutions in Arkansas,
Illinois, Indiana, Iowa, Kentucky, Minnesota, Mississippi, Missouri,
Ohio, Rhode Island, South Carolina and Wyoming.
113

Addendum 1, Attachment A to Exhibit 51 lists the monthly
commission report for December 2012 from ICSolutions for
Ramsey County, Minnesota. The “Total Local Prepaid” calls were
9,964. Subtracting the 8,141 “Local PrePaid” calls leaves exactly
1,823. The only place that number appears in the column describing
the number of calls is for the row labeled “Intra Cell PrePaid.”
These calls were therefore local in origin but arbitrarily rerated to
the more expensive rate. For the comparison with the lower cost of
local calls to landlines, we used the the connect and per minute
charges from Exhibit 23, ICSolutions’ Minnesota Tariff. Average talk
time in Table 10 was calculated from the number of minutes and
number of calls listed in Exhibit 51’s December 2012 report.

Id.

106

We note that Telmate’s website describes a number of advanced
security features, including the ability to flag suspect in-process calls
and automatically route them to the mobile phone of a correctional
officer. See Investigator Tools at http://www.telmate.com/product/
investigator-tools/. If Telmate and other vendors can offer
something that complicated, they could also develop a rate structure
that doesn’t breed distrust.

114

This calculation does not address the evidence presented in the
previous table that calls are getting shorter as they become more
expensive, and instead focuses on the calls as they currently exist.
Charging the higher rates does appear to be shortening the length of
calls, but because local calls do not have a per-minute cost, the fact
that the calls are being shortened does not change our calculation of
the fiscal cost to Ramsey County families from the rerating practice.

107

If the FCC hasn’t restructured this market by the fall, an
enterprising public policy or criminal justice graduate student could
do an interesting 50 state investigation of the apparent disconnect
between the security needs of the correctional facility and financial
needs of the phone company. How often are phone calls limited in a
way that does not advance security interests but does maximize
phone company revenue? We discovered in an interview that
Telmate, as a matter of policy, limits phone calls to 15 minutes but
does not prohibit a second immediate call to that number. It would
be useful for the FCC to know, of the states where a connection fee
is charged, how many of those states limit the maximum call length
to a time shorter than the amount of time someone is allowed to
call a given number in a day.

115

Drew Kukorowski, The Price to Call Home: State-Sanctioned
monopolization in the Prison phone Industry, at § 2, available at http://
www.prisonpolicy.org/phones/report.html.
116

See for example, the Kansas Department of Corrections
webpage about the phone system at http://www.doc.ks.gov/
facilities/inmate-communications/inmate-telephone and the
Securus announcement of a Texas contract at http://
www.securustech.net/press_listing.asp?press_id=65.

108

117

Yount v. T-Netix, at 12, Pennsylvania Public Utility Commission,
Docket No. C-20042655, Opinion and Order, (May. 1, 2008). See also
Peter Wagner, In Memory of Jon E. Yount, (1938-2012) for a
discussion of how the prison system retaliated against Mr. Yount for
bringing the commission system to public light at http://
www.prisonersofthecensus.org/news/2012/05/22/jon-e-yount/.

See Comments of CenturyLink, at 7, In the Matter of Rates for
Interstate Inmate Calling Services, Before the Federal
Communications Commission, WC Docket No. 12-375 (March 25,
2013), available at http://apps.fcc.gov/ecfs/document/view?
id=7022134781.

27

118

Exhibit 24, In Re: Application of Legacy Long Distance
International, Inc. For a certificate to Provide Intrastate
Interexchange Alternative Operator Service in the State of Georgia,
Legacy Long Distance International Inc.’s Application For a
Certificate of Authority to Provide Competitive Local Exchange
Service, Legacy Long Distance International, Inc.’s Application For
a certificate of Authority to Provide Institutional
Telecommunications Services, Order Adopting Consent Agreement,
Before the Georgia Public Service Commission Docket Nos. 8076,
28152, 30554 (April 21, 2011), available at http://
facts.psc.state.ga.us/Public/GetDocument.aspx?ID=135607.
While investigating Legacy for unauthorized charges and tariff noncompliance, the staff at the California Public Utility Commission
discovered that when asked, the company had failed to disclose
numerous regulatory sanctions. The Commission’s “[s]taff
discovered that in fact Legacy had been sanctioned, investigated,
penalized, had its tariff cancelled, and had its public utility
registration or corporate charter revoked, in 16 other
states.”(Exhibit 25, Order Instituting Investigation on the Commission’s
Own Motion into the Billing Practices and Conduct of Legacy Long
Distance International, Inc. (Legacy) to Determine if Legacy
Violated the Law, Rules, and Regulations Governing the Manner in
which California Consumers are Billed for Phone Services, at 21 of
Attachment B, Before the Public Utilities Commission of the State
of California, Proceeding No. I. 10-06-013 (June 24, 2010), available
at http://docs.cpuc.ca.gov/SearchRes.aspx?
DocFormat=ALL&DocID=412254).
119

See Community Initiatives for Visiting Immigrants in
Confinement (CIVIC), Public Comment, In re Rates for Interstate
Inmate Calling Services, Before the Federal Communications
Commission, WC Docket No. 12-375, submitted March 21, 2013,
http://apps.fcc.gov/ecfs/document/view?id=7022134848.
120

See discussion of Yount above.

28