Senate dials up better protections for payphone users, travelers and troops under consumer-disclosure bill

May 06, 2013
12-20-12 PayPhonePix.jpg

Sen. Ted W. Lieu seeks halt to payphone calls costing $20-for-20-seconds

SACRAMENTO – Consumers using credit or debit cards for payphones in a pinch – such as stranded holiday travelers, those caught with dead cell phones or troops in transit – would be better protected from fees of up to $20 for 20 seconds under a mandatory-signage plan approved today on a bipartisan 32-0 vote by the Senate.

“Many consumers have no idea a domestic payphone call could cost $20 for 20 seconds,” Sen. Ted W. Lieu, D-Torrance, said about Senate Bill 50. “Taking advantage of people who are stranded because of plane delays or bad weather, or troops in areas with no cell phone service, is unfair and beyond reasonsable.”

Lieu’s frustration came after being shocked to learn that federal deregulation of payphones created a loophole where about 30,000 payphones throughout California are not required to provide information on what calls cost when consumers pay with a credit card or a debit card.  Instead, the information that often is provided on the phone lists only what it costs to make a coin or calling-card call.   This can be misleading because it’ll say something like “Local calls, 50 cents.”

As a result, callers using their credit or debit card conclude the costs are the same to the costs posted on the payphone for coin and calling-card calls.  Sticker shock follows when consumers receive bills of $20 for 20 seconds or more.

“Although cell phones are ubiquitous, there are still many instances when people need a payphone,” Lieu said.  “What about when you’re in an area with limited cell phone reception?  Or you’re stranded at the airport because of bad weather and your cell phone battery dies?”

That’s what happened to one of Lieu’s constituents.  According to a column by business writer David Lazarus of the Los Angeles Times, Ronna Kizner of Lakewood found her cell wasn’t working so she called her nearby husband from an airport payphone – which had a sign saying local calls cost 50 cents. Kizner didn’t have change, so she used her credit card. The bill for her 20-second call: $19.98.

Other recent media investigations concluded that between 500,000 and 800,000 U.S. troops going to or returning from Iraq and Afghanistan were essentially forced to pay exorbitant fees when using credit-cards to make payphone calls during layovers in Germany.

Specifically, Senate Bill 50 would impose mandatory signage on California payphones that warn credit and debit-card users of the real costs and provide a toll-free number to learn exactly what fees usage may incur.  The Public Utilities Commission  can then impose fines of between $500 and $50,000 for violations.

SB 50 is supported by the Division of Ratepayer Advocates; the California Public Utilities Commission; Los Angeles World Airports; the Vietnam Veterans of America, California State Council; the Congress of California Seniors; the California Senior Legislature; and the California Airports Council. There is no opposition.

SB 50 now moves to the Assembly. No initial policy hearing has yet been set.  
 
For more, including a Fact Sheet on SB 50 and links to media coverage on this issue, visit Lieu’s Web site at the address below.

Ted W. Lieu represents the more than 1 million residents of Senate District 28, which includes the cities of Beverly Hills, Carson, El Segundo, Hermosa Beach, Lomita, Manhattan Beach, Redondo Beach, Santa Monica, Torrance, West Hollywood and the Palos Verdes Peninsula as well as portions of Long Beach and Los Angeles including, Beverly Glenn, Brentwood, Cheviot Hills, Harbor City, Hollywood Hills, Marina del Rey, Mar Vista, Pacific Palisades, Playa del Rey, San Pedro, Venice, Westwood and Wilmington. See a district map HERE: For more, visit www.senate.ca.gov/lieu.