Fight Continues Over July Order Lowering Prison-Calling Costs

Prisoners “need affordable, transparent access to communications services to maintain vital connections with their family and loved ones, their counsel, and other support systems,” the public interest groups told the court. Yet, for decades, IPCS providers “have charged egregiously high rates and engaged in other deceptive practices.” Providers “have done so because they face no competitive forces or other incentives to consider the interests of IPCS consumers, who are a captive market."

The brief was filed by Direct Action for Rights and Equality, the Pennsylvania Prison Society and the Criminal Justice Reform Clinic.

As the market developed, IPCS providers “paid ‘site commissions’ to prisons and jails in exchange for contracts to operate at their facilities, and then passed along the cost … to incarcerated people and their families,” the public interest brief said. The groups also asked the court to address concerns that the FCC went too far to accommodate providers' interests.

“Though the Commission correctly relied on the ‘used and useful’ framework to examine which costs should be incorporated into its rate caps, the Commission’s application of that framework to incorporate certain costs in its lower and upper bounds was contrary to law and arbitrary and capricious,” the brief said. In determining the lower bounds of costs, the FCC “unlawfully and unreasonably included safety and security costs in the form of ‘communications security services,’ but those costs predominantly serve law enforcement and surveillance purposes, and are therefore not ‘necessary’ to the provision of IPCS nor used and useful to IPCS consumer.”

IPCS providers Securus and Pay Tel countered that the rates the FCC allows are so low that one-third of providers won’t be able to recover their costs. “The FCC violated Congress’s command that the agency’s compensation plan ensures that ‘all’ IPCS providers are ‘fairly compensated,’” the companies said. The agency “interpreted ‘all’ to mean ‘efficient’ and erased the ‘fairly compensated’ requirement from the statute by concluding that just and reasonable rates necessarily provide fair compensation.”

The FCC “dramatically understates IPCS providers’ costs,” Securus and Pay Tel said. Its “conclusion that IPCS rates should not pay for [certain] safety and security measures does not make those costs disappear. A more accurate calculation would show that the rate caps place more than half of all providers underwater, including Securus.” The FCC also failed “to perform a mandatory task Congress assigned in the MWR Act: to identify which safety and security measures are ‘necessary to provide IPCS,” the brief said. “Skipping this step allowed the FCC to exclude recovery for many measures without having to confront the necessity of those measures.”

The National Sheriffs’ Association raised similar concerns, noting that the FCC violated the act's requirement that it “shall consider” the costs of needed safety and security measures. “The FCC improperly concluded that this statutory mandate did not require giving any ‘specific weight’ to such costs, effectively rendering Congress’s directive superfluous,” the sheriffs said. In addition, they said the FCC’s application of the “used and useful” framework to evaluate safety and security measures “is arbitrary and capricious.” That framework “was designed for traditional two-party telecommunications markets and fails to account for the unique three-party structure of the IPCS market, which includes correctional facilities as essential stakeholders.”