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HRDC quoted on court stay of prison phone rates, March 9, 2016.

A Plan to Slash the Exorbitant Cost of Phone Calls for US Prisoners Got Put on Hold

By Tess Owen

A plan to to slash the exorbitant call rates charged by phone companies to prison inmates and their families was put on hold this week by a US appeals court.

It's the most recent development in a long battle waged by prison advocates, inmates, and their loved ones against what they contend is profiteering on the part of phone companies that contract with private prisons. In some cases, a call out of prison can cost as much as $14 per minute.

Last year, in a 3-2 vote, the Federal Communications Commission agreed to cap call rates at 11 cents a minute for prisons, and 14 to 22 cents for jails. Prison phone company giants Securus Technologies and GTL weren't happy and came back at the FCC with a lawsuit. Those companies contended that the FCC's order was overreaching, and convinced a court that FCC's caps shouldn't be imposed until their legal battle was over. The court did, however, uphold the FCC's ban on the fees that can substantially hike up the cost of a phone call.

Executives from prison phone companies wrote in a letter to the FCC that the proposed rate caps would ruin them financially, and their businesses would "suffer irreparable, immediate harm."

FCC Commissioner Mignon Clyburn, meanwhile, praised the new rules when they were voted on last October, and said the prison phone industry's dealings were "the most egregious case of market failure I have seen in my 17 years as a state and federal regulator."

Ancillary fees effectively cover the "services" that prison phone companies provide to an inmate with a call account, including deposit fees, monthly account maintenance fees, and account cancellation fees. According to a report by the Prison Policy Initiative, the 2.2 million inmates locked up in facilities across the US spend about $1 billion calling home each year. Inmates pay an estimated $380 million each year on calling fees alone.

The astronomical call rates were first brought to the public's attention a decade ago by Martha Wright-Reed, a woman from Washington, DC, whose grandson went to prison for manslaughter in 1994. Wright-Reed alleged she spent about $1,000 a year taking collect calls from her grandson, even though each conversation lasted 15 minutes at most. She became the lead plaintiff in a class-action suit against Corrections Corporation of America (CCA) and other private prison companies.

The suit alleged that the high call rates and ancillary charges were "not set to further any security purpose or cover the costs involved in providing phone service to inmates, but rather are primarily designed to enrich Defendants (through the inflated rates and high commission fees) at the expense of the recipients of inmate calls."

Prisons have turned a huge profit from their phones. Phone companies offer generous payments to private prisons in exchange for contracts. Alex Friedmann, associate director of Human Rights Defense Center and the managing editor of Prison Legal News, told VICE News he's seen "kickbacks" as high as 94 percent of the value of the contract.

"This is how this population of people, who are primarily poor, inmates' family and their loved ones, are exploited by private companies who provide phone services," Friedmann said. "In any other context, if a private contractor was giving money to the government, it would be considered bribery and would be illegal. In this context, it's perfectly legal. This is how the industry works."

A 2012 report by the Vera Institute found that recidivism rates are lower among inmates who maintain regular contact with their loved ones.

"Incarcerated men and women who maintain contact with supportive family members are more likely to succeed after their release," the report said. "Prison inmates who had more contact with their families and who reported positive relationships overall are less likely to be re-incarcerated.

The prison phone company giant Global Tel Link has also acknowledged that it's beneficial for inmates to be able to contact their families.

"Studies and reports continue to support that recidivism can be significantly reduced by regular connection" the company said. "[A] 13 percent reduction in felony conviction and a 25 percent reduction in technical violations."

FCC Chairman Tom Wheeler and Commissioner Clyburn expressed their disappointment over the court's decision to grant phone companies a judicial stay this week.

"While we regret that relief from high inmate calling rates will be delayed for struggling families and their 2.7 million children trying to stay in touch with a loved one, we are gratified that costly and burdensome ancillary charges will come to an end," Wheeler and Clyburn said in a joint statement. "Ultimately, we believe the court will uphold the new rates set by the Commission."