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Highlights from the Report

• 59 "Truth-in-Billing" (TIB) violations on a sample of 110 bills, including missing information, charges that do not add up correctly, mislabeling, etc. (TIB is a set of guidelines created by the FCC to ensure that phone bills are readable.) Example? The word "surcharge(s)" on the NY bill lacks any description of how the charges are applied.
• Because of deregulation, NO regulator examines the entire phone bill for revenues or profits. Multiple jurisdictions have been allowed to add charges.
• The total of taxes and surcharges on the NY City bill are 112% higher than the cost of basic local 'Dial tone' service.
• Some of the taxes and surcharges represent revenues that are collected for the telephone company, even though they are misleadingly designated as itemized charges such as the "FCC Line Charge", which does not fund the FCC as most customers assume from the name.
• Since 1999 the FCC Line Charge has increased from $3.50 to $6.50 without any proof that such an increase is necessary. In fact, based on estimates of what an efficient company’s "line charges" should cost customers, the current FCC Line Charge should be reduced by almost 85%, not increased to $9.00.
• Quintuple taxes applied — The FCC Line Charge has Federal, state and local, Universal Service Fund charges, and 'surcharges' applied, adding 27% in NY, 18% in NJ and most of the US is somewhere in-between.
• The Spanish American War Tax (Federal Excise Tax) was applied to phone bills in 1898 to fund the war and was never removed.
• The Universal Service Fund (USF) is a multiple-fund creation that is "out of control", with various claims of fraud, lack of oversight, and lack of competitive bidding.
• The Universal Service "High-Cost" funds are being given to Very Profitable rural and urban telcos regulated under "Price Caps", that no longer examines profits.
• Packages — An estimated 15-25% of the population are on the wrong package which cost them more money. Most households do NOT benefit from a package.
• The taxes and surcharges on Verizon packages adds 36% to the total advertised price. (The price doesn't include the FCC Line Charge, for example.)
• Calling Features — The cost of Call Waiting is less than a penny yet the companies charge retail of $4.00 — $5.30 a month.
• "Idiot Items" populate phone bills, which are services that cost $0.00. Example — Many NY bills have a Touchtone line-item, which was removed in the mid-1990's.
• Verizon New Jersey still charges for Touchtone! — Try buying a rotary telephone.
• Cross-subsidization? The 'Consumer Education" Inserts have turned into what appears to be free advertising for Verizon's other products, from DSL to wireless.
• Competitive ISPs are paying "broadband taxes" that Verizon and the other Bell companies and cable companies do not charge their own customers.
• Misleading statements to the press and public. Verizon NY and NJ in 2003 claimed that they hadn't raised rates for 11 to 20 years, but they never include various items in this analysis, such as the FCC Line Charge. They redefined and "devalued" the term "Basic Service" for their own use.
• Class Action Suit Settlement for Small Businesses in New Jersey Our survey found multiple mistakes on customer phone bills. Teletruth has helped to initiate two class action suits based on the survey results. On March 30^th, 2004, the first case against Verizon was settled. Our survey found that 40% of the small businesses under 5 lines in New Jersey were missing their discounts. Our second case found that at least 10% of small businesses were paying for non-existent 'special circuits', such as an alarm circuit.