
Written
by Cyrus Heravi
A recent Federal
Communications Commission (FCC) ruling 13-113 places a 21 cent per minute limit on interstate prepaid calls and a 25 cent per minute on interstate collect
calls.
FCC
Rule 13-113 Background
Like
most industries today, the inmate communications industry is experiencing a
shift in business as usual. The days of exorbitantly high calling rates and
rejected calls to friends and family who cannot afford a simple phone
conversation— these days are coming to an end. While we at Legacy believe
that affordable rates for friends and family is essential to inmate
rehabilitation and a healthier community, the new FCC ruling does present new
challenges for the corrections industry and the vendors who provide secure
communication services.
Effective
February of this year, inmates and their friends and family will experience
cheaper calling rates when placing interstate calls due to the newly instituted
Federal
Communications Commission (FCC) ruling that places a per minute rate cap on
calls between states. The ruling is
aimed at turning the recent tide of dominant inmate communications companies
charging high fees to friends and family trying to stay connected. But the new
ruling is not without its complexities.
Legacy
Communications has offered clients lower calling rates than its competitors
since entering into the inmate communications industry over a decade ago. Our
company was previously a national payphone provider and long distance carrier,
but we transitioned to inmate communications with the belief that our reliable
call network and solid infrastructure could provide detention facilities with a
great product. We’ve built our company on the idea that lower calling rates
translate into a higher volume of phone calls; and more calls means an inmate
population that feels connected to people and community. Not all companies
currently competing for business in the inmate communications market employ the
same approach to lower calling rates, which is the main reason for the FCC’s
new action.
The
push for lower calling rates has needed over a decade to gain traction. The
current FCC ruling has its roots back in 2003 when Ms. Martha Wright, a
grandmother from Washington D.C., petitioned the FCC for more affordable long
distance rates for inmates placing calls to friends and family. At the time,
inmate communications companies such as Securus and GTL were leading the
industry with skyrocketing calling rates and fees. When companies like Legacy
began competing for customers, we offered lower calling rates and a reliable
infrastructure to connect calls. Since then the industry has undergone a gradual
self-regulation, trending toward more affordable rates, but nothing as dramatic
the decrease that the FCC has now put into effect.
Self-Regulation vs. Government
Intervention
The current FCC ruling does
put detention facilities, inmate communications providers and even inmates in a
difficult position.
The expense of providing services differs from facility to facility, and inmate
communication providers supply installation, equipment and infrastructure
upfront, receiving compensation solely from a small percentage of call
revenues. Contracts with facilities usually range between 2-5 years, with
detention facilities free to choose another provider at the end of the
contract. As unpredictable as this system can potentially be, it is
nevertheless effective in generating competition among inmate communication
vendors. Because of this competition,
inmate vendors were and still are in the process of lowering rates due to
normal market forces.
Call
storage, voice biometrics, infrastructure security, equipment, staff—the challenges in setting up a
telecommunications network for detained individuals at a secure location are
not the same as the home phone service you enjoy every day. These things
cost considerable amounts of money and time in development. Legacy’s philosophy
in regard to rate structures for our customers is based on meeting the needs of
all involved—the facility, inmates and friends and family—while having the
resources to research and develop new solutions for our clients. We understand
the spirit of the new FCC ruling, and we do believe that there are companies in
the industry that take advantage of friends and family by charging exorbitantly
high rates and fees, but we also believe that the current inmate communications
market was and is on its way toward self-regulation.
This said, let’s explore
some of the new challenges and potential benefits the ruling presents:
Correction Facility Impact
Jail administrators,
already faced with the difficult task of safely housing a growing amount of detainees
within a strict budget, will now experience new challenges because of the
ruling.
Finding a way to fight inmate recidivism while keeping jails efficient and
effective is an ongoing task for jail administrators in every state, and with
municipalities struggling to find funding, this task will become more complex.
For instance, Inmate
Welfare Funds will experience a new difficulty finding the funds for staffing
and inmate related services, as these services are largely funded by
commissions from inmate phone calls and commissary sales. Inmate Welfare Funds
provide for such things as onsite staff, feeding inmates, clothing, rehabilitation
programs and operations.
The
calling rates that are in effect at each facility are largely determined by
county administrators based on proposals from a spectrum of vendors competing
for their business. The chosen provider compensates the facility with a decided
upon commission percentage of each call placed from the detention facility.
With mandated lower call rates and the elimination of commissions on interstate
calls there are, in turn, lower commissions. As a result of the recent FCC
ruling it is possible that facility staff will be reduced and cuts made
to security and inmate programs.
Constituent Impact
Communities might be asked
to pick up the tab for cuts made to detention facilities, meaning higher taxes. So
that safety and welfare are not compromised, resources for funds will have to
be reallocated, and new revenue streams created.
Positives and Negatives
There
is no doubt that the new FCC ruling will have many effects. For friends and
family of detainees the new ruling means an ease of communication across
states, but it could mean compromised onsite infrastructure and higher taxes to
pick up the tab. At the facility level, Inmate Welfare Funds will undergo
extensive audits to better understand if and how funds can be better allocated.
At
the inmate communications provider level, the cost effectiveness of value added
services and commission offerings will have to be revised and restructured,
with potentially negative consequences. Again, inmate communications companies
do not charge facilities for installation, equipment or ongoing services, and
receive funding based solely on call revenues. Providing state-of-the-art security
services for facilities to monitor inmates and stop crimes becomes more
challenging with a substantial decrease in revenue.
Looking Forward
It
is important that friends and family of detainees are able to stay connected at
affordable prices. We look forward to
working with our clients nationwide in meeting these new challenges in ways
that better serve the public, all while providing the same reliable service.
What
do you think? Do detention facilities have to sacrifice efficiency and
effectiveness because of the new FCC ruling, or are there other options?
Let us know your thoughts by leaving a comment below,
or dropping us a line on Facebook or
Google+.
LINKS:
Here is an article from San Jose Inside that details the new FCC
ruling:
San
Jose Inside
And here is the official FCC ruling in its entirety:
FCC
Ruling
About Legacy
Inmate Communications
Legacy
is a nationwide provider and has been a leader in the inmate communications
industry for over 17 years, with headquarters in Cypress, California. We provide favorable rates for friends and
family, unparalleled customer service and a host of technology options that
complement all parties involved in reducing inmate recidivism. Legacy is unique
in that it is a single-source provider, researching, developing, building
integration and implementing every aspect of its Inmate Telephone Systems and
Video Visitation Systems.