Why are Collect Calls more expensive?

Regulations

• Inmate phone service is regulated in most states by each state's Public Service Commission ("PSC").

• Most states have service guidelines and regulations with rate caps set for local and intra-state long distance calls.

• Many states require inmate phone service providers to file tariffs publishing their service offerings and call rates.

• These rates are included in the Inmate Telephone Service contract with each jail facility.

PAY-TEL Communications, Inc. complies with all state Public Service Commission rules, regulations and rate caps where we provide service.

Increasing Costs - Specialized Equipment

• Collect calls are "operator-assisted" calls because of the automated inter-active response in notifying the called party of the callers identity and the called party's positive acceptance of the call.

• The costs associated with providing automated collect calling are significantly higher than the cost to make a simple local call, direct dial long distance call or a 1(800) call.

• Confinement facility officers require expensive specialized equipment that is designed to protect the public from abuse and criminal activity.

• In addition to the expensive equipment the costs to validate, bill and collect inmate calls are constantly rising.

Increasing Costs - Customer Service

• Today a growing number of customers are choosing to have their local phone service with telephone companies and wireless carriers that refuse to bill inmate calls.

• In years past PAY-TEL would submit one billing tape for thousands of customers to the local telephone company for billing each month.

• Today PAY-TEL has developed programs to help the same number of customers open individual Prepaid or Direct Bill accounts quickly.

• Our commitment to make sure families can receive calls without interruption has increased our Customer Service costs dramatically.

Increasing Costs - Fraud

• Regrettably the one cost that is rising faster than all others is the bad debt or uncollectible losses resulting from the Theft of Telecommunications Service.

• Today there are a number of customers that attempt to come up with ways to avoid paying for calls they have accepted.

Please be aware that the Theft of Telecommunications Services is a crime. For more information on State criminal statues and penalties, click here.

• Sadly this theft of services ultimately hurts the good honest customers who accept and pay for the calls every month because as our costs rise we are forced to raise rates.

What is Pay Tel doing to lower rates?

• PAY-TEL is proud of our twenty three year record of charging the lowest inmate phone service rates in the industry. Since 1991 PAY-TEL has led the industry in offering inmates and their families a variety of options to establish prepaid accounts with low payment fees.

• Pay Tel, in June 2007, lowered the price on in-state long distance calls in Virginia , South Carolina and Tennessee .

• Pay Tel's price for in-state long distance calls is half the price charged by most of our competitors in states where rates are not regulated.

• Pay Tel's rates for local collect calls are either at or below the Public Service Commission regulated rate in all states and are significantly below the 50 state average local call rate of $2.90 per call.