Steep Costs of Inmate Phone Calls Are Under Scrutiny

After years of complaints from prison-rights groups and families of the incarcerated, the Federal Communications Commission is investigating the financial intricacies of the industry, which has been largely unregulated. At the core of the inquiry are the hundreds of millions of dollars in concession fees, known as commissions, paid by the phone companies to state and local prison systems in exchange for exclusive contracts. The fees help drive phone charges as high as $1.22 per minute, and the leading companies say they need to charge at least 20 cents per minute, compared with typical commercial rates of about 4 cents a minute.

In 2013, a total of $460 million in concession fees was paid to jails and prisons, and to state, county and local governments, according to the FCC. The fees are legal, and they cover a range of expenses within prisons as well as outside. The agency is expected to rule in 2015 on whether to ban the concession fees and limit the costs of prison phone calls. An analysis released in 2013 by the FCC said the fees “have caused inmates and their friends and families to subsidize everything from inmate welfare to salaries and benefits, states’ general revenue funds and personnel training.” It added, “The companies compete not based on price or service quality, but on the size of the commission.” The possibility of eliminating the fees has met fierce opposition from prisons and jails, sheriff’s departments and local officials. Some law enforcement groups have said changes could stoke inmate violence against prison guards because there might be less money for security.