Gouging L.A. County inmates with high phone fees

The Los Angeles County Sheriff’s Department isn’t breaking any laws with its lousy jail pay phone system.

But it isn’t doing people any favors either.

It’s not news that some of the country’s highest pay phone rates can be found behind bars. Earlier this year, federal regulators capped rates for interstate calls from prisons and jails at 25 cents a minute after receiving numerous complaints that a 15-minute call could run as much as $17.

L.A. County officials say they’re determined to protect family members of inmates from onerous pay phone charges. But the county has an incentive to keep rates high — it gets the lion’s share of the take.

Global Tel-Link, the Alabama company that provides L.A. County jails with about 5,000 pay phones, guarantees the Sheriff’s Department at least $15 million in annual payments.

And the department receives more than two-thirds of any pay phone revenue above $15 million.

“Everyone’s making a lot of money at the expense of inmates’ families,” said L.A. County Supervisor Zev Yaroslavsky, who has spearheaded efforts to reduce jail pay phone charges.

“They’re in jail,” he said. “They’re paying their debt to society. That doesn’t give us the right to fleece them.”

Even so, I was contacted recently by West Hills resident Kim Iannone, whose 24-year-old son was arrested last month on suspicion of drunk driving. The charge was later reduced to reckless driving.

During the three days her son was in L.A. County jail, Iannone said, she received an automated call from Global Tel-Link instructing her to set up a prepaid account to enable her son to call her collect. The minimum amount required to create the account, she said, was $25.

Iannone’s son called once. They spoke for about six minutes. The call cost $3.15. Iannone deemed that rate exorbitant, but there was more to come.

After her son was released, she wondered why her account balance of $21.85 wasn’t automatically refunded.

Global Tel-Link requires that account holders ask for their money and then wait possibly weeks to be reimbursed. Funds that remain inactive for more than 180 days become the company’s property.

Moreover, a Global Tel-Link service rep told me that Iannone would have to pay a refund fee of $5, which would be deducted from her balance.

“The Los Angeles jail system steals from us,” Iannone said.

Prison and jail inmates constitute the quintessential captive market. Private pay phone operators such as industry leader Global Tel-Link can charge prices well above the rates charged by phone companies for residential and business customers.

Karen Dalton, assistant director of the Sheriff Department’s Custody Division, said officials have “the best interest of the consumer in mind.”

“We didn’t set out to gouge anyone,” she said.

The current system in place at L.A. jails is actually an improvement over the steeper rates Global Tel-Link previously charged.

Under the company’s former contract with L.A. County, Global Tel-Link charged $3.54 for the first minute of a call and 10 cents for each additional minute. AT&T and Verizon charge about 4 cents a minute — or less — for residential local calls.

After Global Tel-Link received the contract for L.A. jail pay phones from Pacific Bell in 2008 without any competition, county officials decided they could probably cut a better deal in the future by seeking bids from others. The bidding process began in late 2009.

The winning bidder was an L.A. company called Public Communications Services, which said it would charge $1.25 for the first minute of a jail pay phone call plus 15 cents for each additional minute.

It also pledged to pay a minimum of $15 million a year to the Sheriff’s Department plus 67.5% of any revenue surpassing that amount.

Global Tel-Link seems to have understood that its lucrative lock on jail pay phone services was in danger. Three months after the bidding closed in August 2010, Global Tel-Link purchased Public Communications Services for an undisclosed sum.

A new contract with Global Tel-Link, featuring the lower rates offered by Public Communications Services, was approved by county supervisors in September 2011.

I reached out to Global Tel-Link to discuss its pay phone rates at L.A. jails. Steve Montanaro, the company’s vice president of sales and marketing, instructed me to put all my questions in an email.

I subsequently received a reply from Global Tel-Link’s complaint department saying that, for privacy reasons, it couldn’t discuss Iannone’s case. It ignored all my other questions about fees, refunds and the acquisition of Public Communications Services.

I received no response to a followup email.

Dalton said all proceeds from the pay phone contract go the Sheriff Department’s Inmate Welfare Fund, which provides education programs for detainees and money for upkeep of jail facilities.

“If we didn’t have those dollars, we wouldn’t be able to provide life skills and other resources,” she said.

From a budgetary perspective, the pay phone charges thus play a positive role for detainees. Without the influx of funds, Dalton said, the county would need to find another way to pay for inmate welfare — or go without such programs.

However, this raises the possibility of a conflict of interest. In its efforts to maintain revenue from jail pay phones, the county may not be as aggressive as possible in reducing costs for inmate families.

Dalton acknowledged that some could see the situation that way. “It’s a conversation that comes up a lot,” she said.

Seems to me that L.A. County isn’t flexing enough of its bureaucratic muscle. We have the largest jail system in the nation. The pay phone concession for roughly 19,000 detainees has to be a desirable gig for any company in this line of work.

I’m not saying we need to go easier on inmates. But we could certainly do a better job of protecting their families from rip-offs. That $1.25 first-minute fee and $5 refund charge seem like particularly ripe targets.

Global Tel-Link’s current contract is up in 2020. That gives officials plenty of time to cook up a tougher negotiating strategy.

David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to david.lazarus@latimes.com.