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Free cell-phone service in doubt: TracFone reconsiders offer after state insists on payment of 911 taxJul 13, 2009 (The Columbus Dispatch - McClatchy-Tribune Information Services via COMTEX) -- Low-income families might lose the chance for free cell-phone service as a result of a disagreement between provider TracFone Wireless Inc. and state regulators. TracFone, which offered to provide its federally subsidized SafeLink service to thousands of Ohioans, is now reconsidering after the Public Utilities Commission of Ohio refused to relent on several conditions it placed on the company. The program would give qualifying low-income families a free cell phone with 68 minutes of service at no charge every month. On May 21, the PUCO gave the wireless provider permission to offer its service, on the conditions that it be offered on an interim basis for one year, and that TracFone verify consumer eligibility and pay taxes toward Ohio's 911 fund. In June, TracFone asked for reconsideration of those conditions. On Wednesday, the PUCO upheld all of the conditions except one: It lifted the requirement that TracFone verify user eligibility. The 911 tax would amount to 28 cents per phone per month, and because all other wireless carriers are required to pay it, there was no reason to treat TracFone differently, the PUCO indicated in last week's ruling. The company is considering its next step, but "doesn't see many more options," said Jose Fuentes, director of government relations for SafeLink. "We're rather disappointed in the ruling the PUCO has made," he said. "Now we're just taking a step back and seeing if we're going to roll out in Ohio." According to TracFone, a for-profit company, more than 1.1 million households in Ohio would qualify for the free cell-phone program. To qualify, a consumer would have to have income equal to no more than 135 percent of the federal poverty level or qualify for other federal programs, such as food stamps or Medicaid. PUCO spokeswoman Shana Eiselstein said TracFone has 30 days to petition for reconsideration or until next Monday to submit a plan showing how it would comply with the conditions. Currently, the federally subsidized Lifeline program, meant to give all Americans access to a telephone, has been used only to provide land-line service in Ohio. It offers low-income people discounted services via state-regulated phone companies such as Verizon and AT&T. Exclusive to TracFone, SafeLink has been given special status by the Federal Communications Commission to participate in the Lifeline program, pending state approval. According to the PUCO, about 264,000 households in the state are using the Lifeline land-line program. The Office of the Ohio Consumers' Counsel has different concerns about TracFone's program, mainly regarding the 20-cents-per-minute cost of additional minutes after the free 68 minutes are used. The consumers' counsel supports more options for consumers, said spokesman Ryan Libbe, but he said few customers would be able to keep phone use to 68 minutes per month if that pre-paid wireless unit were their primary phone, a requirement of the program. He said the high cost of additional minutes could add up. The land-line program has no minute restrictions. Currently, TracFone has SafeLink programs operating in 16 states, with seven others pending, including Ohio. [email protected] To see more of The Columbus Dispatch, or to subscribe to the newspaper, go to http://www.columbusdispatch.com. Copyright (c) 2009, The Columbus Dispatch, Ohio Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |