Proposed Rule2025-22130
Incarcerated People's Communication Services; Implementation of the Martha Wright-Reed Act; Rates for Interstate Inmate Calling Services
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Published
December 5, 2025
Issuing agencies
Federal Communications Commission
Abstract
In this document, the Federal Communications Commission (Commission) seeks additional comment and data from stakeholders on adopting permanent audio and video IPCS rate caps and on whether and how the Commission should refine its IPCS data collections going forward to provide the data needed to ensure rate caps are just and reasonable and fairly compensate IPCS providers. It also seeks comment on how and when the Commission should structure a permanent rate additive to account for the recovery of correctional facility costs incurred in making IPCS available, including an additive that potentially varies by facility type and size. Finally, it proposes to retain the prohibition on ancillary service charges previously adopted by the Commission and seeks further comment on this proposal. In the alternative, it seeks comment on a request to reinstate automated payment fees and third-party financial transaction fees as permissible ancillary service charges.
Full Text
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<title>Federal Register, Volume 90 Issue 232 (Friday, December 5, 2025)</title>
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[Federal Register Volume 90, Number 232 (Friday, December 5, 2025)]
[Proposed Rules]
[Pages 56115-56123]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-22130]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 64
[WC Docket Nos. 12-375, 23-62; FCC 25-75; FR ID 319623]
Incarcerated People's Communication Services; Implementation of
the Martha Wright-Reed Act; Rates for Interstate Inmate Calling
Services
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) seeks additional comment and data from stakeholders on
adopting permanent audio and video IPCS rate caps and on whether and
how the Commission should refine its IPCS data collections going
forward to provide the data needed to ensure rate caps are just and
reasonable and fairly compensate IPCS providers. It also seeks comment
on how and when the Commission should structure a permanent rate
[[Page 56116]]
additive to account for the recovery of correctional facility costs
incurred in making IPCS available, including an additive that
potentially varies by facility type and size. Finally, it proposes to
retain the prohibition on ancillary service charges previously adopted
by the Commission and seeks further comment on this proposal. In the
alternative, it seeks comment on a request to reinstate automated
payment fees and third-party financial transaction fees as permissible
ancillary service charges.
DATES: Comments are due on or before January 5, 2026; and reply
comments are due on or before February 3, 2026.
ADDRESSES: Interested parties may file comments and reply comments on
or before the dates indicated in this document in WC Docket Nos. 23-62
and 12-375 by any of the following methods:
<bullet> Electronic Filers: Comments may be filed electronically
using the internet by accessing the Electronic Comment Filing System
(ECFS): <a href="https://www.fcc.gov/ecfs/filings/standard">https://www.fcc.gov/ecfs/filings/standard</a>.
<bullet> Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing. If more than one docket
or rulemaking number appears in the caption of this proceeding, filers
must submit two additional copies for each additional docket or
rulemaking number.
<bullet> Filings can be sent by hand or messenger delivery, by
commercial courier, or by the U.S. Postal Service. All filings must be
addressed to the Secretary, Federal Communications Commission.
<bullet> Hand-delivered or messenger-delivered paper filings for
the Commission's Secretary are accepted between 8:00 a.m. and 4:00 p.m.
by the FCC's mailing contractor at 9050 Junction Drive, Annapolis
Junction, MD 20701. All hand deliveries must be held together with
rubber bands or fasteners. Any envelopes and boxes must be disposed of
before entering the building.
<bullet> Commercial courier deliveries (any deliveries not by the
U.S. Postal Service) must be sent to 9050 Junction Drive, Annapolis
Junction, MD 20701. Filings sent by U.S. Postal Service First-Class
Mail, Priority Mail, and Priority Mail Express must be sent to 45 L
Street NE, Washington, DC 20554.
<bullet> People with Disabilities. To request materials in
accessible formats for people with disabilities (Braille, large print,
electronic files, audio format), send an email to <a href="/cdn-cgi/l/email-protection#88eeebebbdb8bcc8eeebeba6efe7fe"><span class="__cf_email__" data-cfemail="dbbdb8b8eeebef9bbdb8b8f5bcb4ad">[email protected]</span></a>, or
call the Consumer and Governmental Affairs Bureau at (202) 418-0530
(voice) or (202) 418-0432 (TTY).
FOR FURTHER INFORMATION CONTACT: Shabbir Hamid, Pricing Policy Division
of the Wireline Competition Bureau, at (202) 418-2328 or via email at
<a href="/cdn-cgi/l/email-protection#86d5eee7e4e4eff4a8cee7ebefe2c6e0e5e5a8e1e9f0"><span class="__cf_email__" data-cfemail="b1e2d9d0d3d3d8c39ff9d0dcd8d5f1d7d2d29fd6dec7">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Further Notice of Proposed Rulemaking (FNPRM), in WC Docket Nos. 12-375
and 23-62, FCC 25-75, adopted on October 28, 2025 and released on
November 6, 2025. This summary is based on the public redacted version
of the document, the full text of this document can be accessed
electronically via the FCC's Electronic Document Management System
(EDOCS) website at <a href="http://www.fcc.gov/edocs">www.fcc.gov/edocs</a>, or via the FCC's Electronic
Comment Filing System (ECFS) website at <a href="http://www.fcc.gov/ecfs">www.fcc.gov/ecfs</a>, or is
available at the following internet address: <a href="https://docs.fcc.gov/public/attachments/FCC-25-75A1.pdf">https://docs.fcc.gov/public/attachments/FCC-25-75A1.pdf</a>.
Synopsis
I. Further Notice of Proposed Rulemaking
1. In the Further Notice of Proposed Rulemaking (FNPRM), we seek
additional comment and data from stakeholders on the following issues:
adopting permanent audio and video IPCS rate caps; adopting a permanent
rate additive for facility cost recovery, including one that varies by
facility type and size; and maintaining the prohibition on ancillary
service charges, among other matters. We place particular emphasis on
seeking additional data from parties to the extent feasible to enable
us to resolve these issues based on objective data and analysis,
wherever possible.
A. Adoption of Permanent Rate Caps for Audio and Video IPCS
2. Today's Order adopts interim rate caps for audio and video IPCS,
reflecting the evolving video IPCS marketplace and resulting anomalies
in provider-reported video data, but also in recognition of the
limitations of the available data on safety and security costs and of
the cost data more generally. Meanwhile, commenters continue to
acknowledge a need for permanent rate caps. We agree that permanent
caps are necessary for IPCS and, accordingly, we seek further comment
on how the Commission could best adopt permanent rate caps for audio
and video IPCS which are just, reasonable, and fairly compensatory and
the time frame for implementing any such rate caps.
3. Permanent Audio IPCS Rate Caps. The accompanying Order adopts
audio IPCS rate caps on an interim basis in light of the need to
resolve questions with the current data, and to better refine and
analyze safety and security data, among other factors. We invite
further comment about how to adopt permanent audio IPCS rate caps, and
about the data we need to allow us to do so. The Commission will be
receiving more refined data about market rates and demand after recent
revisions to the IPCS Annual Reports are implemented, and from a future
mandatory data collection. On January 8, 2025 the Commission revised
the IPCS annual reporting and certification obligations to require
submissions of information related to video IPCS. The first filings of
the revised Annual Reports and certifications that will include
information on video IPCS were due on November 3, 2025. What additional
information is essential to collect before the Commission can act to
set permanent audio IPCS rate caps? Are any further changes to our rate
cap setting methodology necessary?
4. Permanent Video IPCS Rate Caps. The accompanying Order adopts
video IPCS rate caps on an interim basis for several reasons, including
the aforementioned market and data factors. Significant time has passed
since the Commission last sought comment on the adoption of permanent
rate caps for video rates as part of the 2024 IPCS Notice and the
Bureau has since granted waiver petitions sought by IPCS providers to
accommodate certain unintended consequences of the Commission's rate
structure rules governing video IPCS. We now invite commenters to
further supplement the record concerning the status of the video IPCS
market and the adoption of permanent video IPCS rates. What changes
have commenters observed in the video IPCS marketplace since the
adoption of the 2024 IPCS Notice? How have video market costs, prices,
demand, revenues, deployment, and services changed over time?
5. How else has the video IPCS marketplace evolved with the passage
of time? We seek comment on the changes in availability of and demand
for video IPCS, and for other, non-IPCS video products, including the
deployment of platforms and devices capable of delivering these
services. For example, how has demand for video IPCS changed since the
2023 Mandatory Data Collection (reflecting 2022 data)? We also seek
comment on how costs for providing video IPCS and revenues for video
IPCS have changed since the 2024 IPCS Notice. Have per-minute costs
declined as the market developed? What are the trends for video IPCS
industry revenues and profitability, given
[[Page 56117]]
potentially declining per-minute costs and increasing demand? How do
costs for providing video IPCS differ between industry leaders, or
between large providers and smaller providers? Similarly, what
investments are IPCS providers making in video platforms and devices
today, and how do those expenditures differ from recent years, if at
all? And how should such trends factor into the adoption of permanent
rate caps for video IPCS? What data could be used to project the rate
of future investments in video software and hardware? Video IPCS
platforms and devices typically enable the provision of both regulated
video IPCS and nonregulated video services. We seek comment on how
video IPCS providers recover shared costs between regulated and
nonregulated services. Do commenters expect the usage of regulated and
nonregulated services to change over time, and, if so, how should such
trends be taken into account in adopting permanent video IPCS rate
caps?
6. Commenters generally agree that the video IPCS marketplace is
still in its nascent stages and investments in video IPCS
infrastructure continue to be relatively high given current demand. We
seek comment on the continued evolution of the video IPCS marketplace,
and on the data that would most accurately reflect its growth and
development. One commenter suggests three criteria which may indicate a
maturing market: ``comparing the variance of costs across video calling
products with the variance of costs among audio calling products,
comparing within-provider costs to those of market leaders, and
analyzing forecast demand by service providers.'' Are these effective
ways of gauging whether the video IPCS marketplace has matured with
sufficient reliability to set permanent video rates? If so, why? If
not, what are the other alternatives? What additional data will best
support these analyses, and how can we obtain such data, if it has not
already been collected?
7. When do commenters expect the video IPCS marketplace will reach
a point where the Commission will be able to set reliable permanent
rate caps? Conversely, if commenters believe the video IPCS data
already allows us to adopt permanent rate caps, why? Certain commenters
suggest permanent video IPCS rate caps should be adopted immediately.
What advantages and disadvantages would there be from adopting
permanent caps in the near future versus doing so at a later date? What
are the costs and benefits of maintaining interim caps over a longer
period to allow the marketplace to develop? How do the costs and
benefits of delay versus immediacy translate to the adoption of
permanent audio rate caps?
8. Considerations Applicable to Both Audio and Video IPCS. While
our rate making methodology is largely a settled matter, we seek
comment on a proposal to modify one aspect of the methodology.
Specifically, we seek comment on Securus's proposal that the Commission
use simple averages instead of minute-weighted averages to set its rate
caps, noting that the 2021 ICS Order used simple averages and claiming
that ``using minute-weighted average costs overemphasizes large
facility costs.'' We also seek comment on Securus's claim that using
simple, facility-based averages to set rate caps would ``lead to a
higher rate cap and more providers being able to recover their actual
costs.''
9. We seek additional comment on whether and how we should refine
the IPCS data collections going forward, particularly in light of the
recognized anomalies with IPCS data. Are any adjustments to the
structure of the collection necessary to distinguish between necessary
equipment and services costs? What other data are necessary, if any,
for the Commission to consider establishing permanent, per-minute audio
and video IPCS rate caps? In particular, should we attempt to collect
data that would allow us to measure the effects future inflation and
productivity increases will have on the average cost per minute of
providing audio and video IPCS and rate caps and, if so, what data
should we collect? How can the Commission ensure all video IPCS
providers fully respond to any additional data collection?
10. Commenters should identify the relevant safety and security
data and information necessary to set permanent IPCS audio and video
rate caps, and should specify how the Commission should seek to have
such information reported. To what extent have audio and video IPCS
safety and security services changed over time, and how should any such
change impact the adoption of permanent audio or video IPCS rate caps?
Are there any trends in safety and security expenses in the IPCS
provider or private business sectors, and if so, how should they be
accounted for when adopting permanent audio or video IPCS rate caps?
For example, Zoom and Teramind offer safety and security add-ons
(including listening to a call without the parties being aware and
remote employee monitoring) as part of their business communications
services.
11. We also seek comment on how providers recover shared costs for
safety and security services between video and audio IPCS and between
IPCS and non-IPCS services. What data would help the Commission to
properly allocate such costs among these services? Should the
categories used previously be adjusted and, if so, how? Should there be
a larger, smaller, or the same number of categories as compared to the
number in the 2023 Mandatory Data Collection, and how should each
category be defined? Should the Commission exclude from rate caps any
allowance for recovery of safety and security expenses attributable to
law enforcement functions? The 2023 Mandatory Data Collection directed
providers to allocate safety and security expenses among seven
different categories and then to further allocate the expenses within
each of these categories among (1) audio IPCS, (2) video IPCS, (3)
ancillary services, and (4) other products and services. If we were to
draw a line between safety and security expenses attributable to IPCS
functions versus law enforcement functions, for example, could we
simply retain the existing reporting structure and at the same time
clarify that safety and security expenses are to be allocated to other
products and services to the extent these are incurred as a consequence
of providing law enforcement functions? Or would a better approach be
to add law enforcement as a separate, fifth ``service'' to which safety
and security expenses could be allocated? How might the Commission
direct providers to allocate expenses shared between IPCS and law
enforcement functions? Are there better approaches than our current
category-based approach to standardize the reporting and collection of
safety and security cost data that commenters recommend? What other
information should we seek concerning safety and security services
which would help us determine just, reasonable, and fairly compensatory
rates? Are there any factors related to safety and security expenses
that primarily affect either audio or video rates alone, and if so,
what are they, and why?
12. Likewise, we seek comment on any interaction or interdependence
between audio IPCS and video IPCS offerings, including relationships
between service pricing or usage. Will the continued video IPCS market
evolution also affect the market for audio rates and, if so, how? Do
providers expect demand for audio IPCS to fall as demand or
availability of video IPCS increases? Should video IPCS be
[[Page 56118]]
considered a substitute for audio IPCS? Additionally, when adopting
permanent rate caps for either audio or video IPCS, how should the
Commission factor in the recovery allotted to providers from a
permanent rate additive for facility costs as proposed in this FNPRM,
if any?
13. Parties note that correctional institutions are increasingly
paying directly for IPCS and making service available to incarcerated
people free of charge. They propose that the Commission address the
applicability of its IPCS regulations to instances where a correctional
institution is the party that pays for IPCS. Commenters note, for
example, that in the ``agency-paid model,'' correctional institutions
may use alternative units of sale, such as ADP, instead of per-minute
rates to purchase IPCS. We seek comment on the applicability of our
regulations to correctional institutions as, in effect, wholesale
purchasers of IPCS. To what extent do the Martha Wright-Reed Act and
the Communications Act provide legal authority to the Commission to
regulate the rates and related conditions of IPCS when purchased by an
intermediary for retail customers' use?
B. Adoption of Permanent Rate Additives for Facility Cost Recovery
14. We seek comment on how and when the Commission should structure
a permanent rate additive or additives to account for correctional
facility costs. In today's Order, we adopt a uniform interim rate
additive of up to $0.02 per minute for audio and video IPCS for all
facility types and size tiers. Several commenters support the use of an
additive, arguing that it will provide a predictable framework for IPCS
providers and correctional authorities to ensure the recovery of
correctional facility costs in the provision of IPCS. Do commenters
agree? Why or why not? We seek comment on the assertion by one
commenter that additives will effectively reintroduce site commissions
and on the extent adopting a permanent rate additive may actually
minimize market distortions the record shows site commissions can
generate. The interim rate caps we set today are provider-related rate
components, the revenues from which are not intended for facility cost
recovery, which is the purpose of the separate rate additives we seek
further comment on today. Pay Tel, however, cites the fact that the
record shows that at least one provider sought to offer correctional
facilities payments from rate cap revenues. We seek further comment on
Pay Tel's request for clarification ``that any site commissions in
excess of the facility cost additive remain prohibited.'' What are the
benefits and burdens of a rate additive for IPCS providers,
correctional facilities, and IPCS consumers?
15. We also seek comment on how to structure a permanent rate
additive. As an initial matter, we invite comment on whether a
permanent additive should be a uniform cap across all rate tiers or
whether it should vary by correctional facility type and/or size. What
specific tasks, responsibilities and activities do correctional
facilities undertake? What are the number of person hours and the
hourly wage rates required to provide each activity and each activity's
frequency of occurrence? Do these activities and their frequency and
costs vary depending on the size or type of the facility, the volume of
calls, the correctional authority's policies, or other factors and, if
so, how should the Commission incorporate those variations into any
permanent rate additive? We also seek comment on a recommendation by
one commenter that ``IPCS providers that incorporate any facility
additive [with] the rate and compensate facilities accordingly must
document those costs before such a payment could be imposed on or
charged to the paying customer.'' Additionally, should providers be
required to demonstrate that any expenses being recovered through the
rate additive be for used and useful expenses incurred in making IPCS
available?
16. The interim per-minute rate additive we adopt today applies
uniformly to all rate tiers, in principal part due to the lack of
reliable correctional facility cost data currently in the record beyond
the National Sheriffs' Association 2015 cost survey. The Commission
previously has highlighted that ``[o]btaining reliable correctional
facility cost data has been a perennial problem in these proceedings.''
As we explain above, the record lacks the requisite data that would
allow the Commission to reasonably justify a variable additive based on
facility type or size. Yet, the National Sheriffs' Association argues
that a rate additive ``cannot be uniform because the costs to
facilities are not uniform'' but provides no data or other information
regarding costs beyond what was previously submitted in the record. As
Securus notes, the ``[k]ey to establishing a reasonable rate additive
is gaining up-to-date information on facility costs.'' We agree and
invite further comment on how we can ensure we receive current,
complete, and reliable data that accurately capture the differences in
used and useful costs that facilities of different sizes and types
incur. We request commenters address in detail the types of data that
would be most useful in determining facility costs and the procedures
we should follow in collecting the data.
17. To the extent commenters support a permanent rate additive that
varies by facility type and size, we underscore the importance of
receiving updated, relevant data in the record given that correctional
facilities are not regulated entities subject to data retention
requirements, as commenters have recognized. Securus suggests that
while ``the Commission cannot compel correctional agencies to provide
such information, the Commission could facilitate the voluntary
submission of such information by creating a simple and straightforward
template by which correctional agencies could submit information on the
costs they incur.'' The Commission has not previously considered
undertaking the design of a template given its inability to compel the
submission of facility cost data by correctional institutions. However,
the Commission seeks comment on whether it should consider doing so.
Apart from creating a template, what categories of cost information
should correctional institutions submit and how can the Commission best
work with providers and correctional institutions to encourage the
submission of reliable and consistent cost data? If we engage in a
voluntary collection, how should we evaluate the data received to
determine if it is a representative sample appropriate for use in this
regulatory context? Are there other sources of data or methods of
collection that we should consider?
18. To the extent commenters support a uniform additive, should we
make the interim $0.02 per minute additive adopted in today's Order
permanent? Why or why not? If $0.02 per minute would not be a
reasonable permanent uniform additive, are there data that the
Commission could rely on that would support adopting a different
amount? For example, a limited survey conducted by Pay Tel's outside
consultant, which consisted of only 30 correctional facilities,
reported an average cost to facilities of $0.08 per minute for allowing
the provision of IPCS. The Commission gave no weight to this survey in
the 2024 IPCS Order and we do not give any weight to it today in
adopting the $0.02 per minute interim additive for the same reasons
articulated in the 2024 IPCS Order. However, Pay Tel's outside
consultant argued that with this limited survey ``and previously-
submitted data, the Commission has the information necessary to adopt a
rate cap that includes an explicit additive for the
[[Page 56119]]
recovery of facility-incurred safety and security costs.'' Pay Tel
neither identifies the ``previously-submitted data'' nor explains how
its survey might fit with those data to arrive at a rate additive. We
invite comment on these issues. Here, too, the receipt of reliable,
current cost data is paramount and commenters are encouraged to provide
data and analysis supporting any such proposal. If the Commission does
not receive any such data, how should the Commission proceed?
C. Continued Prohibition of Ancillary Service Charges
19. Ancillary service charges have long been a source of
detrimental practices in the IPCS market and imposing constraints on
such fees has been an integral part of the Commission's attempts to
ensure just and reasonable IPCS rates. The Commission has taken steps
on several occasions to set limits on ancillary service charges and
associated practices. Most recently, in the 2024 IPCS Order, the
Commission prohibited ancillary service charges and instead
incorporated the costs providers reported incurring to make these
services available in the rate caps it adopted. In its Petition for
Reconsideration, HomeWAV seeks reinstatement of two previously
permissible ancillary service charges--automated payment fees and
third-party financial transaction fees.
20. We propose retaining, for the same reasons the Commission
articulated in the 2024 IPCS Order, the prohibition on ancillary
service charges adopted by the Commission and seek comment on this
proposal. As the Public Interest Parties explain, the Commission made a
determination in the 2024 IPCS Order ``that eliminating separate
ancillary service charges and incorporating'' the costs of those
services ``into the per-minute rate caps would best reflect the nature
of such services as an intrinsic part of IPCS and balance the relevant
interests at stake.'' Do commenters agree with this assessment? Why or
why not? Would the benefits of retaining the prohibition on separate
ancillary service charges outweigh the burdens? Why or why not?
21. However, to be thorough, we seek comment on HomeWAV's request
that we reinstate automated payment fees and third-party financial
transaction fees as permissible ancillary service charges. Automated
payment fees include a wide variety of fees assessed by IPCS providers
for most, if not all, financial transactions with consumers. Third-
party financial transaction fees include credit card processing fees
and fees for transfers from third-party commissary accounts. We seek
comment on whether these two ancillary charges should be reinstated and
on the appropriate regulatory treatment of ancillary service charges
generally.
22. In comments to HomeWAV's Petition for Reconsideration, Securus
questions if the Commission contemplated whether the number of
transactions would increase due to the removal of minimum deposit
amounts and account funding fees, and what impact the potential
increase of transactions would have on overall costs that would need to
be recovered. Pay Tel adds that prohibiting these two ancillary service
charges ``will encourage behavior that increases . . . costs--and under
the new rate structure, these costs will not be recoverable.'' HomeWAV
further asserts that ``imposing all associated [automated payment fees
and third-party financial transaction fee] costs solely on the
provider'' could ``lead to operational disruptions and compromise the
long-term sustainability of providers.''
23. We seek comment on whether providers are able to recover their
costs of providing account funding services without being able to
charge separate fees--under the rate caps set by the Commission in the
2024 IPCS Order, the current interim rate caps we set here, or under
any permanent rate caps we adopt--and what impact the prohibition on
these fees may have on the sustainability of IPCS providers. In the
2024 IPCS Order, the Commission found that providers incurred an
average cost of $0.011 per minute to provide ancillary services, based
on the 2023 Mandatory Data Collection. We now seek comment and
additional data on the amount of additional costs providers incur in
making these two ancillary services available in the absence of being
able to assess separate charges for them. We also seek comment on the
potential burden of such costs.
24. If either fee or both fees should be reinstated, at what amount
should the related fee cap or caps be set, and why? The Commission
previously established a $3.00 cap on automated payment fees and a
$5.95 cap on third-party financial transaction fees. Should we reimpose
the same caps on these two fees previously imposed or should we set
different caps? At what level would a cap or caps allow providers to
recover their costs? At what level would a cap or caps be just and
reasonable for consumers? Subsequent to its petition, HomeWAV advocates
in favor of $3.00 ``payment processing fees.'' We seek comment on this
suggestion. Should the Commission use the cost data providers report in
a subsequent data collection to calculate different, cost-based caps
for one or more of the two fees if necessary to reflect any increased
usage rates providers are experiencing? Would setting fee caps based on
those data overstate costs, if fees are reinstated and demand for the
services is reduced?
25. While HomeWAV requests reinstatement of automated payment fees
and third-party transaction fees, other providers suggest different
fees should also be reinstated. For example, NCIC proposes reinstating
certain transaction fees, including a live agent fee and a single call
fee, but also proposes the elimination of certain other transaction
fees. We seek comment on whether any other fees should be reinstated,
and we request that any proposals for reinstating other ancillary
service charges address the issues raised here with regard to automated
payment fees and third-party transaction fees. We seek comment
specifically on alternative proposals made by NCIC. NCIC's alternative
proposals include suggesting the establishment of a $3.00 funding fee
for automated, web, and app payments, a $5.95 funding fee for payments
making use of a live agent, a $0.25 funding fee for single calls or a
ban on single call service, and deposit limits for minimums set at
$5.00 and maximums set at $100.00. NCIC proposes to re-establish
single-call fees, albeit at the rate of $0.25 per call and provides the
option to ban single-call services outright. We also seek comment on
the potential burden of such costs.
26. If the Commission were to reinstate one or more ancillary
service charges, it will need sufficiently reliable cost and demand
data on each of the types of service charges that is reinstated in
order to determine the relevant costs for each such charge. What
changes, if any, to the Commission's reporting requirements, including
to a future mandatory data collection and to its ongoing IPCS Annual
Reports, should we consider to more accurately capture up-to-date
ancillary service costs and demand, including the costs incurred when
consumers fund their IPCS accounts?
27. We also seek comment on how automated payment fees and third-
party financial transaction fees could be reinstated without unduly
burdening consumers. Commenters have previously voiced concerns that
automated payment fees and third-party financial transaction fees were
often exploited, and consumers were charged both fees for a single
transaction, effectively allowing providers to double
[[Page 56120]]
bill or recover. How could the Commission redefine these charges to
avoid such concerns? We also seek comment on how implementing two
separate financial transaction charges can protect consumers from
unfair charges as HomeWAV suggests. Similarly, we seek comment on other
concerns raised related to ancillary service charges, including the
risk of consumer fraud and money laundering and the risk that the
combination of the prohibition of ancillary service charges with the
prohibition of account minimums create conditions that encourage
consumers to ``inundate providers with small deposits,'' which can
``drastically increase costs for providers.'' HomeWAV argues that the
existence of fees to fund IPCS accounts serve as a deterrent to fraud
and money laundering by ``associating an appropriate cost with the
deposit of funds'' and that, if IPCS accounts are loaded using credit
cards that are later determined to be stolen, then IPCS providers are
responsible for ``chargebacks, bank fees, and licensing costs.''
28. We also seek comment as to whether there are any similarly
effective alternatives to reinstating automated payment fees and third-
party financial transaction fees. For example, Securus suggests that
the Commission allow IPCS providers to establish a minimum deposit
amount. We seek comment on this proposal. Is this a reasonable
alternative that will change consumer incentives and reduce provider
costs? What amount would be appropriate as a potential minimum deposit
limit and why? Securus suggests $10, but others suggest lower minimums.
How should the Commission calculate a minimum deposit amount if it
chooses this alternative approach? For example, would a minimum deposit
limit of $10 provide enough stability to provider costs to offset the
burden of prohibiting these types of fees? Conversely, we also seek
comment on the burden that a minimum deposit amount would impose on
families of incarcerated people and IPCS users. Commenters are
encouraged to quantify the costs and benefits to providers, IPCS users
and their families, of any alternative approaches to fee reinstatement.
II. Procedural Matters
29. Regulatory Flexibility Act. The Regulatory Flexibility Act of
1980, as amended (RFA), requires that an agency prepare a regulatory
flexibility analysis for notice and comment rulemakings, unless the
agency certifies that ``the rule will not, if promulgated, have a
significant economic impact on a substantial number of small
entities.''
30. The Commission has prepared an Initial Regulatory Flexibility
Analysis (IRFA) concerning the potential impact of rule and policy
change proposals in the 2025 IPCS Notice on small entities. The
Commission invites the general public, in particular small businesses,
to comment on the IRFA. Comments must be filed by the deadlines for
comments on the 2025 IPCS Notice indicated on the first page of this
document and must have a separate and distinct heading designating them
as responses to the IRFA.
31. Paperwork Reduction Act (PRA). This document does not contain
proposed information collections subject to the Paperwork Reduction Act
of 1995 (PRA), 44 U.S.C. 3501-3521. In addition, therefore, it does not
contain any new or modified information collection burden for small
business concerns with fewer than 25 employees, pursuant to the Small
Business Paperwork Relief Act of 2002, 44 U.S.C. 3506(c)(4).
32. Providing Accountability Through Transparency Act. Consistent
with the Providing Accountability Through Transparency Act, Public Law
118-9, a summary of the 2025 IPCS NPRM will be available on <a href="https://www.fcc.gov/proposed-rulemakings">https://www.fcc.gov/proposed-rulemakings</a>.
33. OPEN Government Data Act. The OPEN Government Data Act,
requires agencies to make ``public data assets'' available under an
open license and as ``open Government data assets,'' i.e., in machine-
readable, open format, unencumbered by use restrictions other than
intellectual property rights, and based on an open standard that is
maintained by a standards organization. This requirement is to be
implemented ``in accordance with guidance by the Director'' of OMB. The
term ``public data asset'' means ``a data asset, or part thereof,
maintained by the Federal Government that has been, or may be, released
to the public, including any data asset, or part thereof, subject to
disclosure under the Freedom of Information Act (FOIA).'' A ``data
asset'' is ``a collection of data elements or data sets that may be
grouped together,'' and ``data'' is ``recorded information, regardless
of form or the media on which the data is recorded.'' We delegate
authority to the Wireline Competition Bureau, in consultation with the
agency's Chief Data and Analytics Officer and after seeking public
comment to the extent it deems appropriate, to determine whether any
data assets maintained or created by the Commission pursuant to the
rules adopted in the 2025 IPCS Order are ``public data assets'' and if
so, to determine when and to what extent such information should be
published as ``open Government data assets.'' In doing so, WCB shall
take into account the extent to which such data assets should not be
made publicly available because they are not subject to disclosure
under the Freedom of Information Act. See, e.g., 5 U.S.C. 552(b)(4),
(6)-(7) (exemptions concerning confidential commercial information,
personal privacy, and information compiled for law enforcement
purposes, respectively). We also seek comment in the 2025 IPCS Notice
on whether any of the information proposed to be collected in the
Notice would constitute ``data assets'' for purposes of the OPEN
Government Data Act and, if so, whether such information should be
published as ``open Government data assets.''
34. Comment Period and Filing Procedures. Pursuant to Sec. Sec.
1.415 and 1.419 of the Commission's rules, 47 CFR 1.415, 1.419,
interested parties may file comments and reply comments on or before
the dates indicated on the first page of this document. All filings
must refer to WC Docket Nos. 23-62 and 12-375.
35. Comments and reply comments must include a short and concise
summary of the substantive arguments raised in the pleading. Comments
and reply comments must also comply with Sec. 1.49 and all other
applicable sections of the Commission's rules. We direct all interested
parties to include the name of the filing party and the date of the
filing on each page of their comments and reply comments. All parties
are encouraged to use a table of contents, regardless of the length of
their submission. We also strongly encourage parties to track the
organization set forth in the 2025 IPCS Notice in order to facilitate
our internal review process.
36. Ex Parte Rules. The proceeding that the 2025 IPCS Notice
initiates shall be treated as a ``permit-but-disclose'' proceeding in
accordance with the Commission's ex parte rules. Persons making ex
parte presentations must file a copy of any written presentation or a
memorandum summarizing any oral presentation within two business days
after the presentation (unless a different deadline applicable to the
Sunshine period applies). Persons making oral ex parte presentations
are reminded that memoranda summarizing the presentation must (1) list
all persons attending or otherwise participating in the meeting at
which the ex parte presentation was made, and (2) summarize all data
presented and
[[Page 56121]]
arguments made during the presentation. If the presentation consisted
in whole or in part of the presentation of data or arguments already
reflected in the presenter's written comments, memoranda, or other
filings in the proceeding, the presenter may provide citations to such
data or arguments in the prior comments, memoranda, or other filings
(specifying the relevant page and/or paragraph numbers where such data
or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with Sec. 1.1206(b). In proceedings governed by
Sec. 1.49(f) or for which the Commission has made available a method
of electronic filing, written ex parte presentations and memoranda
summarizing oral ex parte presentations, and all attachments thereto,
must be filed through the electronic comment filing system available
for that proceeding, and must be filed in their native format (e.g.,
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding
should familiarize themselves with the Commission's ex parte rules.
37. People with Disabilities. To request materials in accessible
formats for people with disabilities (Braille, large print, electronic
files, audio format), send an email to <a href="/cdn-cgi/l/email-protection#4b2d28287e7b7f0b2d2828652c243d"><span class="__cf_email__" data-cfemail="82e4e1e1b7b2b6c2e4e1e1ace5edf4">[email protected]</span></a> or call the
Consumer and Governmental Affairs Bureau at 202-418-0530.
38. Availability of Documents. Comments, reply comments, and ex
parte submissions will be publicly available online via ECFS.
III. Initial Regulatory Flexibility Analysis
39. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission has prepared this Initial Regulatory
Flexibility Analysis (IRFA) of the policies and rules proposed in the
Further Notice of Proposed Rulemaking (FNPRM) assessing the possible
significant economic impact on small entities. The Commission requests
written public comments on this IRFA. Comments must be identified as
responses to the IRFA and must be filed by the deadlines for comments
specified on the first page of the FNPRM. The Commission will send a
copy of the FNPRM, including this IRFA, to the Chief Counsel for the
Small Business Administration Office of Advocacy (SBA). In addition,
the FNPRM and IRFA (or summaries thereof) will be published in the
Federal Register.
A. Need for, and Objectives of, the Proposed Rules
40. In the FNPRM, the Commission seeks additional comment on
establishing permanent, just and reasonable, and fairly compensatory
rate caps for audio and video incarcerated people's communications
services (IPCS). The Commission requests comment on what information
and changes to its rate setting methodology will be needed to allow the
adoption of permanent rate caps for audio IPCS, among other matters.
The Commission also requests comment regarding the status of the video
IPCS market and how costs, prices, revenues, and services have changed
over time. Additionally, the Commission requests information on the
evolution of the video IPCS marketplace and on when it will be able to
set reliable permanent video IPCS rate caps. Further, the Commission
seeks comment on matters applicable to both audio and video IPCS,
including how it should collect data, how safety and security services
have changed over time, and the relationship of audio IPCS pricing and
usage to video IPCS pricing and usage.
41. The Commission also seeks comment on whether it should adopt a
permanent rate additive to account for correctional facility costs
related to the provision of IPCS and on how to structure such a rate
additive. The Commission also asks whether a permanent rate additive
should be uniform across all rate tiers or whether it should vary by
correctional facility type and/or size. Further, the Commission asks
how it can obtain updated, relevant data on correctional facilities'
costs given that facilities are not regulated entities subject to data
retention and accounting requirements. The Commission seeks comment on
whether it should make the interim $0.02 per-minute uniform rate
additive permanent.
42. The Commission also seeks comment on how it should address site
commission payments made by IPCS providers to the facilities they
serve. Specifically, the Commission proposes to retain the prohibition
on site commission payments and seeks comment on the extent to which
its adoption of an industry-wide, per-minute rate additive, either
uniform or non-uniform, would eliminate any need for site commission
payments. The Commission asks whether facilities could use a rate
additive to recover their used and useful costs of allowing access to
IPCS in lieu of, or in addition to, site commission payments.
Alternatively, the Commission seeks comment on whether, if the
Commission were to permanently allow providers to pay site commissions,
it should cap or otherwise limit to the amount or type of site
commissions providers may pay. Additionally, the Commission seeks
comment on the appropriate timeframe for compliance with any site
commissions reforms that may be adopted in response to the FNPRM.
43. The Commission also seeks comment on its proposal to retain the
prohibition on ancillary service charges adopted in the 2024 IPCS
Order. The Commission also seeks comment on whether the benefits of
retaining the prohibition on separate ancillary service charges would
outweigh the burdens. Further, the Commission seeks specific comment on
two types of ancillary service charges--automated payment fees and
third-party financial transaction fees--and asks whether they should be
reinstated. Lastly, the Commission seeks comment on whether any
alternatives to reinstating automated payment fees and third-party
financial transactional fees exist.
B. Legal Basis
44. The proposed actions are authorized pursuant to sections 1, 2,
4(i)-(j), 201(b), 218, 220, 225, 255, 276, 403, and 716 of the
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i)-(j),
201(b), 218, 220, 225, 255, 276, 403, 617, and the Martha Wright-Reed
Just and Reasonable Communications Act of 2022, Public Law 117-338, 136
Stat. 6156 (2022).
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
45. The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted. The RFA generally defines
the term ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A ``small business concern'' is one which: (1) is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Act. The SBA establishes small business size standards that agencies
are required to use when promulgating regulations relating to small
businesses; agencies may establish alternative size standards for use
in such programs, but must
[[Page 56122]]
consult and obtain approval from SBA before doing so.
46. Our actions, over time, may affect small entities that are not
easily categorized at present. We therefore describe three broad groups
of small entities that could be directly affected by our actions. In
general, a small business is an independent business having fewer than
500 employees. These types of small businesses represent 99.9% of all
businesses in the United States, which translates to 34.75 million
businesses. Next, ``small organizations'' are not-for-profit
enterprises that are independently owned and operated and not dominant
their field. While we do not have data regarding the number of non-
profits that meet that criteria, over 99 percent of nonprofits have
fewer than 500 employees. Finally, ``small governmental jurisdictions''
are defined as cities, counties, towns, townships, villages, school
districts, or special districts with populations of less than fifty
thousand. Based on the 2022 U.S. Census of Governments data, we
estimate that at least 48,724 out of 90,835 local government
jurisdictions have a population of less than 50,000.
47. The rules proposed in the FNPRM will apply to small entities in
the industries identified in the chart below by their six-digit North
American Industry Classification System (NAICS) codes and corresponding
SBA size standard. Based on currently available U.S. Census data
regarding the estimated number of small firms in each identified
industry, we conclude that the proposed rules will impact a substantial
number of small entities. Where available, we also provide additional
information regarding the number of potentially affected entities in
the industries identified below.
Table 1--2022 U.S. Census Bureau Data by NAICS Code
----------------------------------------------------------------------------------------------------------------
Regulated industry (footnotes
specify potentially affected Total small % Small
entities within a regulated NAICS code SBA size standard Total firms firms firms
industry where applicable)
----------------------------------------------------------------------------------------------------------------
All Other Telecommunications.... 517810 $40 million........ 1,673 1,007 60.19
Wired Telecommunications 517111 1,500 employees.... 3,403 3,027 88.95
Carriers.
Wireless Telecommunications 517112 1,500 employees.... 1,184 1,081 91.30
Carriers (except Satellite).
Telecommunications Resellers.... 517121 1,500 employees.... 955 847 88.69
----------------------------------------------------------------------------------------------------------------
Table 2--Telecommunications Service Provider Data
----------------------------------------------------------------------------------------------------------------
2024 Universal service monitoring report telecommunications SBA size standard (1500 employees)
service provider data (data as of December 2023) ----------------------------------------------------
------------------------------------------------------------ Total number FCC % Small
Affected entity Form 499A filers Small firms entities
----------------------------------------------------------------------------------------------------------------
Competitive Local Exchange Carriers (CLECs)................ 3,729 3,576 95.90
Incumbent Local Exchange Carriers (Incumbent LECs)......... 1,175 917 78.04
Interexchange Carriers (IXCs).............................. 113 95 84.07
Local Exchange Carriers (LECs)............................. 4,904 4,493 91.62
Local Resellers............................................ 222 217 97.75
Other Toll Carriers........................................ 74 71 95.95
Payphone Service Providers................................. 28 24 85.71
Toll Resellers............................................. 411 398 96.84
Telecommunications Resellers............................... 633 615 97.16
Wired Telecommunications Carriers.......................... 4,682 4,276 91.33
Wireless Telecommunications Carriers (except Satellite).... 585 498 85.13
----------------------------------------------------------------------------------------------------------------
D. Description of Economic Impact and Projected Reporting,
Recordkeeping, and Other Compliance Requirements for Small Entities
48. The RFA directs agencies to describe the economic impact of
proposed rules on small entities, as well as projected reporting,
recordkeeping and other compliance requirements, including an estimate
of the classes of small entities which will be subject to the
requirements and the type of professional skills necessary for
preparation of the report or record.
49. In the FNPRM, the Commission seeks comment on a series of
matters whose resolution will affect all IPCS providers and
correctional facilities, including those that may be small entities.
These matters include whether the Commission should establish permanent
audio and video IPCS rate caps for all types of facilities (including
jails with average daily populations below 1,000) and whether the
Commission should adopt a permanent IPCS rate additive to account for
correctional facility costs and how to structure a permanent rate
additive. In considering how to allocate IPCS providers' costs, the
Commission seeks comment on how these costs should be divided between
regulated and nonregulated costs. In addition, the Commission seeks to
identify the relevant safety and security data necessary to set
permanent IPCS rate caps. The Commission also seeks comment on whether
it should continue to prohibit site commission payments and ancillary
service charges given its other actions with regard to IPCS, and
whether any such changes should result in additional annual reporting
requirements.
50. The Commission anticipates that all IPCS providers, including
those that are small entities, will be subject to any rules adopted in
response to the FNPRM and that such rules will not affect small
providers disproportionately. The Commission requests comment on the
appropriate amount of time needed for ICPS providers to comply with the
proposed rules, including time needed to negotiate with correctional
facilities to implement any of the proposed changes. In addition, the
Commission expects that all IPCS providers, including those that are
small entities, will need to hire, or retain the services of, lawyers
and other professionals to ensure they comply with the proposed rules.
The Commission anticipates that the information it receives in comments
[[Page 56123]]
will help it identify and evaluate relevant compliance matters for
small entities, including compliance costs and other burdens that may
result from implementation of the proposals and inquiries in the FNPRM.
E. Discussion of Significant Alternatives Considered That Minimize the
Significant Economic Impact on Small Entities
51. The RFA directs agencies to provide a description of any
significant alternatives to the proposed rules that would accomplish
the stated objectives of applicable statutes, and minimize any
significant economic impact on small entities. The discussion is
required to include alternatives such as: ``(1) the establishment of
differing compliance or reporting requirements or timetables that take
into account the resources available to small entities; (2) the
clarification, consolidation, or simplification of compliance and
reporting requirements under the rule for such small entities; (3) the
use of performance rather than design standards; and (4) an exemption
from coverage of the rule, or any part thereof, for such small
entities.''
52. In the FNPRM, the Commission seeks to continue its
implementation of the Martha Wright-Reed Act, including its directive
that the Commission ensure just, reasonable, and fairly compensatory
rates and charges for incarcerated people's audio and video
communications services. While doing so, the Commission seeks comment
on a number of alternatives to determine the potential impact of the
proposals in the FNPRM on small businesses and, in particular, any
disproportionate impact or unique burdens that small businesses may
face in complying with any rules the Commission may adopt. This
includes whether and how to determine the evolution of the video IPCS
marketplace, and how the data may be used to set permanent rate caps.
Other alternatives considered in the FNPRM include whether and how to
structure a permanent rate cap additive while continuing the
prohibition on site commission payments, and the associated burdens
that may result for IPCS providers, correctional facilities, and IPCS
consumers. Alternatively, should site commissions be permitted, the
Commission seeks comment on whether there should be a cap on such
payments.
53. In evaluating the proposals in the FNPRM, the Commission will
consider the information submitted regarding the costs small providers
incur in the provision of audio and video IPCS, as well the costs and
benefits of those proposals and any alternatives to those proposals
suggested in the record. Considering the economic impact on any IPCS
providers that are small entities through comments filed in response to
this FNPRM and this IRFA could allow the Commission to refine its cost-
benefit analysis and provide other input that would enable it to
identify reasonable alternatives that may not be readily apparent, and
offer alternatives not already considered that could minimize the
economic impact on small entities.
F. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
54. None.
IV. Ordering Clauses
55. Accordingly, it is ordered, pursuant to the authority contained
in sections 1, 2, 4(i)-(j), 201(b), 218, 220, 225, 255, 276, 403, and
716 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152,
154(i)-(j), 201(b), 218, 220, 225, 255, 276, 403, and 617, and the
Martha Wright-Reed Just and Reasonable Communications Act of 2022,
Public Law 117-338, 136 Stat. 6156 (2022), that this joint Report and
Order, Order on Reconsideration, and Further Notice of Proposed
Rulemaking in WC Docket Nos. 23-62 and 12-375 are adopted.
56. It is further ordered that, pursuant to applicable procedures
set forth in Sec. Sec. 1.415 and 1.419 of the Commission's rules, 47
CFR 1.415, 1.419, interested parties may file comments on this Further
Notice of Proposed Rulemaking on or before 30 days after publication of
a summary of this Further Notice of Proposed Rulemaking in the Federal
Register and reply comments on or before 60 days after publication of a
summary of this Further Notice of Proposed Rulemaking in the Federal
Register.
57. It is further ordered that the Commission's Office of the
Secretary, shall send a copy of this Report and Order, Order on
Reconsideration, and Further Notice of Proposed Rulemaking, including
the Initial Regulatory Flexibility Analysis and the Final Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small
Business Administration.
Federal Communications Commission.
Marlene Dortch,
Secretary.
[FR Doc. 2025-22130 Filed 12-4-25; 8:45 am]
BILLING CODE 6712-01-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.