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In the Second Report and Order, the Federal Communications Commission (the Commission) adopted rule changes to ensure that rates for both interstate and intrastate inmate calling services (ICS) are fair, just, and reasonable limits on ancillary service charges imposed by ICS providers. In the Second Report and Order, the Commission set caps on all interstate and intrastate calling rates for ICS, established a tiered rate structure based on the size and type of facility being served, limited the types of ancillary services that ICS providers may charge for and capped the charges for permitted fees, banned flat-rate calling, facilitated access to ICS by people with disabilities by requiring providers to offer free or steeply discounted rates for calls using TTY, and imposed reporting and certification requirements to facilitate continued oversight of the ICS market. In the Third Further Notice portion of the item, the Commission sought comment on ways to promote competition for ICS, video visitation, and rates for international calls, and considered an array of solutions to further address areas of concern in the ICS industry.  In an Order on Reconsideration, the Commission amended its rate caps and the definition of "mandatory tax or mandatory fee".

On June 13, 2017, the D.C. Circuit vacated the rate caps adopted in the Second Report and Order, as well as reporting requirements related to video visitation. The court held that the Commission lacked jurisdiction over intrastate ICS calls and that the rate caps the Commission adopted for interstate calls were arbitrary and capricious.  The court also remanded the Commission’s caps on ancillary fees. On September 26, 2017, the court denied a petition for rehearing en banc. On December 21, 2017, the court issued two separate orders: one vacating the 2016 Order on Reconsideration insofar as it purported to set rate caps on inmate calling services, and one dismissing as moot challenges to the Commission’s First Report and Order on ICS.

On February 4, 2020, the Commission's Wireline Competition Bureau (WCB) released a Public Notice seeking to refresh the record on ancillary service charges imposed in connection with ICS.  

On August 6, 2020, the Commission adopted a Report and Order on Remand and a Fourth Further Notice of Proposed Rulemaking responding to remands by the D.C. Circuit and proposing to comprehensively reform rates and charges for the ICS within the Commission’s jurisdiction.  The Report and Order on Remand found that the Commission’s five permitted ancillary service charges: (1) automated payment fees; (2) fees for single-call and related services; (3) live agent fees; (4) paper bill/statement fees; and (5) third-party financial transaction fees generally, cannot be practically segregated between interstate and intrastate inmate telephone calls, except in a limited number of cases.  Accordingly, the Commission prohibited ICS providers from imposing ancillary service fees higher than the Commission’s caps, or imposing fees for additional ancillary services unless imposed in connection with purely intrastate inmate telephone service calls. 

The Order also reinstated a rule prohibiting providers from marking up third-party fees for single-call services; reinstated rule language that prohibits providers from marking up mandatory taxes or fees that they pass on to inmate telephone service consumers; and amended certain of the ICS rules consistent with the D.C. Circuit’s mandates to reflect that the Commission’s rate and fee caps on ICS apply only to interstate and international inmate calling. 

The Fourth Further Notice of Proposed Rulemaking proposed to substantially reduce the interstate rate cap for inmate telephone calls from the current interim rate caps of $0.21 per minute for debit or prepaid calls and $0.25 per minute for collect calls for all types of correctional facilities, to permanent rate caps of $0.14 per minute for all interstate calls from prisons and $0.16 for all interstate calls from jails.  The Fourth Further Notice of Proposed Rulemaking also proposed to adopt rate caps for international ICS calls for the first time based on the proposed interstate rate caps, plus the amount that the provider must pay its underlying international service provider for an international call.  It also proposed a waiver process for providers that believe the Commission’s rate caps would not allow them to recover their costs of serving a particular facility or contract.  Finally, it sought comment on a further mandatory data collection to continue efforts to reform these rates and fees.

On November 23, 2020, Global Tel*Link Corporation (GTL) filed a petition for reconsideration of the August 6, 2020 Order on Remand.  On December 3, 2020, the Commission established the opposition and reply comment dates for the petition. 

On May 24, 2021, the Commission released the Third Report and Order, Order on Reconsideration and Fifth Further Notice of Proposed Rulemaking.  In the Third Report and Order, the Commission: (1) substantially reduced the interim rate caps for interstate ICS from prisons and larger jails (those with 1,000 or more incarcerated people) from $0.21 per minute for debit and prepaid calls and $0.25 per minute for collect calls to new uniform interim interstate caps of $0.12 per minute for prisons and $0.14 per minute for larger jails; (2) maintained the interim interstate rate cap of $0.21 for jails with less than 1,000 incarcerated people because of insufficient record evidence to determine providers’ costs of serving those facilities at the time; (3) eliminated separate treatment of collect calls, resulting in a uniform interim interstate rate cap for all types of calls at each facility; (4) reformed the treatment of site commission payments by specifying that providers may pass through to consumers (without any markup) site commission payments that are mandated by federal, state, or local law and that providers may pass through to consumers no more than $ 0.02 per minute site commission payments resulting from contractual obligations negotiated between providers and correctional officials; (5) capped, for the first time, international calling rates at all facilities at the applicable facility’s total interstate rate cap, plus the amount the inmate calling services provider pays to its underlying wholesale carriers for completing international calls; (6) reformed the ancillary service charge caps for third-party financial transaction fees, including those related to calls that are billed on a per-call basis; and (7) adopted a new mandatory data collection to obtain more uniform cost data based on consistent, prescribed allocation methodologies to determine just and reasonable, permanent, interstate and international cost-based rates for facilities of all sizes. 

In the Order on Reconsideration, the Commission denied GTL’s petition for reconsideration of a single sentence from the 2020 Remand Order, in which the Commission reminded providers that the jurisdictional nature of a call, that is whether it is interstate or intrastate, depends on the physical location of the endpoints of the call and not on whether the area code or NXX prefix of the telephone number associated with the account are associated with a particular state.  The Commission determined that the end-to-end analysis has been, and remains, the generally applicable test for all telecommunications carriers in determining the jurisdiction of their calls and the Commission continues to use the traditional end-to-end jurisdictional analysis in setting rates for calls placed by ICS consumers. 

In the Fifth Further Notice, the Commission proposed to amend its rules to require calling service providers to provide access to all forms of Telecommunications Relay Services, including Internet-based services, to facilitate greater accessibility for incarcerated people with hearing and speech disabilities.  The Commission also sought  comment on: (1) the methodology the Commission should use to set permanent per-minute rate caps for interstate and international inmate calling services; (2) site commission costs for facilities of all sizes and site commission reform generally; (3) the costs of providing services to jails with average daily populations of fewer than 1,000 incarcerated people; (4) whether and how the Commission should reform the ancillary service charge caps and how the Commission can curtail potentially abusive practices related to these charges; (5) whether to institute a recurring periodic data collection; and (6) whether some providers have market power in the bidding process, thereby impacting the competitiveness of the bidding process. 

On September 22, 2021, WCB and the Office of Economics and Analytics (OEA), (collectively, WCB/OEA) issued a Public Notice seeking comment on the contours and specific requirements of the Third Mandatory Data Collection, including proposed instructions and a proposed template for that collection.  In issuing this Public Notice, WCB/OEA were acting pursuant to the Commission’s directive, made in the 2021 ICS Order,  that the new data collection obtain data on providers’ operations, costs, demand, and revenues, among other information.  As the Commission explained in that Order, the collected information would allow the Commission to set permanent interstate and international inmate calling services rate caps and to evaluate and, if warranted, revise the ancillary service charge caps.

On December 15, 2021, WCB/OEA issued a Public Notice seeking comment on revised requirements for ICS Annual Reports, including proposed instructions, templates, and a provider certification.  Specifically, the Public Notice proposed changes in the reporting requirements to align them with ICS rule changes adopted in the 2021 ICS Order.

On January 18, 2022, WCB adopted an Order implementing the Third Mandatory Data Collection and adopted accompanying instructions, reporting templates, and a certification form.  The collected information would allow the Commission to set permanent interstate and international inmate calling services rate caps and to evaluate and, if warranted, revise the current ancillary service charge caps. 

On February 9, 2022, WCB released a public notice announcing that the providers’ mandatory data collection responses will be due no later than June 30, 2022.

On June 24, 2022, WCB adopted an Order implementing revisions to its annual reporting requirements, including accompanying instructions, reporting templates, and a certification form.  The revisions were consistent with changes made in the Third Report and Order.

On September 30, 2022, the Commission released the Fourth Report and Order, and Sixth Further Notice of Proposed Rulemaking.  The Report and Order required ICS providers to provide access to all relay services eligible for Telecommunications Relay Services fund support in any correctional facility that is located where broadband is available and is part of a correctional system with 50 or more incarcerated people.  This included the ability to place point-to-point video calls using American Sign Language. The rules also restricted provider charges for relay services and point-to-point video calls.  More generally, the rules reduced certain charges and curtailed abusive practices related to ICS to ease the financial burdens on all incarcerated people and their families.  To ensure that the rates, terms, and practices related to interstate and international ICS are just and reasonable, the Order prohibited providers from taking control of funds in inactive calling accounts until at least 180 calendar days of continuous inactivity had passed, after which providers are required to refund the balance or dispose of the funds in accordance with applicable state law. The Order also lowered the current ancillary fee caps on charges for single call services, and lowered the cap on provider charges for processing credit card, debit card, and other payments to calling services accounts.  Finally, the Commission revised the definitions of "Prison” and "Jail” in its rules to conform with the Commission’s intent in adopting them in 2015.

In the Sixth Further Notice, the Commission sought additional comment on whether to allow enterprise registration for Internet Protocol Captioned Telephone Service in carceral settings and how to address the special circumstances faced by some ICS providers in jurisdictions with average daily populations of fewer than 50 incarcerated persons.  This Notice sought comment on refining the rules adopted in the Fifth Report and Order concerning the treatment of balances in inactive accounts.  It also sought comment on expanding the breadth and scope of the Commission’s consumer disclosure requirements.  The Commission asked for comment on how it should use the data filed in response to the Third Mandatory Data Collection to establish just and reasonable permanent caps on interstate and international rates and associated ancillary service charges consistent with the Telecommunications Act of 1934 (the Act).  The Commission invited further comment on allowing ICS providers to offer pilot programs allowing consumers to purchase calling services under alternative pricing structures. 

On March 17, 2023, the Commission opened a new docket, WC Docket No. 23-62, and released a Notice of Proposed Rulemaking and Order to begin implementation of the Martha Wright-Reed Just and Reasonable Communications Act of 2022, which was signed into law on January 5, 2023.  The Martha Wright-Reed Act expands the Commission’s authority over rates charged for incarcerated people’s communications services, including intrastate services, and directs the Commission to adopt just and reasonable rates and charges for incarcerated people’s audio and video communications services not earlier than 18 months and not later than 24 months after the date of its enactment.  The Notice seeks comment on (1) the expansion of the Commission’s authority over incarcerated people’s communications services to include advanced communications services (including audio and video services) and intrastate services; (2) the meaning of "just and reasonable” in the context of the Act’s other provisions; (3) the rate-making methodology the Commission should use to fulfill its mandate to ensure that rates and charges for incarcerated people’s communications services are just and reasonable; (4) the safety and security costs necessary for the provision of incarcerated people’s communications services; and (5) the actions the Commission should take to ensure that incarcerated people’s communications services are accessible to, and usable by, people with communication disabilities.  The accompanying Order reaffirmed the Commission’s prior delegation of data collection authority to WCB/OEA and directed staff to initiate a collection of provider data to inform the Commission’s responsibilities to implement the requirements of the Martha Wright-Reed Act.

[Note:  The Commission has historically used the term inmate calling services” or ICS” when referencing payphone service in the incarceration context.  With the passage of the Martha Wright-Reed Act, the Commission now uses the term incarcerated people’s communications services” or IPCS” instead of inmate calling services” or ICS” to refer to the broader range of communications services and providers subject to the Commission’s jurisdiction as a result of the Act.]

On April 28, 2023, the Wireline Competition Bureau and the Office of Economics and Analytics released a Public Notice seeking comment on a proposal to update the Commission’s Third Mandatory Data Collection to encompass and collect data on all incarcerated people’s communications services (IPCS) from all providers of those services subject to the Commission’s expanded authority under the Martha Wright-Reed Just and Reasonable Communications Act.  The proposed modifications included collecting information concerning any audio or video communications service used by incarcerated people for the purpose of communicating with non-incarcerated individuals, regardless of technology used.  The Public Notice also sought comment on proposed modifications to the instructions, reporting template, and certification form to implement the modified mandatory data collection.  

On July 26, 2023, the Wireline Competition Bureau and the Office of Economics and Analytics released an Order adopting the modifications to the Third Mandatory Data Collection proposed in the April 28, 2023, Public Notice.  The modifications included collecting information concerning any audio or video communications service used by incarcerated people for the purpose of communicating with non-incarcerated individuals, regardless of technology used.  The Order adopted the proposed instructions, reporting template, and certification form.  

On August 3, 2023, the Wireline Competition Bureau and the Consumer and Governmental Affairs Bureau released a Public Notice seeking comment on proposed revisions to the Annual Reports and Annual Certifications that the Commission requires certain providers of IPCS to submit. The Public Notice proposed changes to the Annual Reports to (1) reflect expanded reporting requirements regarding access to IPCS by persons with communication disabilities and (2) seek data about video IPCS necessary to implement the Martha Wright-Reed Just and Reasonable Communications Act.  The Public Notice also sought comment on proposed modifications to the instructions, reporting templates, and certification form for the Annual Reports data collection. 

On October 31, 2023, IPCS providers filed their data submissions in response to the 2023 Mandatory Data Collection.  Commission staff processed the submissions and on March [XX], 2024, WCB/OEA  released a Public Notice announcing the availability of the preliminary 2023 Mandatory Data Collection database to eligible individuals pursuant to protective order.  Commission Chairwoman Rosenworcel hosted IPCS listening sessions on October 27, 2023 in Chicago, IL and on February 1, 2024 in Charleston, SC.