Added charges on phone, utility bills baffle consumers

by Melissa Burden | The Flint Journal

Saturday May 03, 10:40 PM

Ryan Garza | The Flint JournalYvonne M. Martin, of Flint, found an old phone bill she paid to Michigan Bell Telephone Company in October 1965 that was $5.53 total and included just taxes in addition to a local service fee. On her current phone bills, she pays all kinds of charges in addition to the local service such as linebacker maintenance, long distance fee, call waiting, federal access charges, 911 billings, federal universal service fee etc. Her bills now cost between $80-$85 a month and she says there are too many fees.

Look around and you're sure to find them:

More information
Where you can learn more about what charges/fees are on your bills and why.
• Michigan Public Service Commission: This agency regulates natural gas, electricity and phone service in Michigan. Find consumer alerts, explanations of utility charges and fees and news releases at www.michigan.gov/mpsc.
• Federal Communications Commission: The FCC regulates wireless companies and oversees some common charges found on telephones and wireless bills. Details: www.fcc.gov.
• Your utility, cellphone, cable, satellite and/or telephone provider: Check Web sites for an explanation of charges, to review your bills or to call toll-free numbers listed on your bills to ask questions about charges.

Fees. Surcharges. Taxes.
Your phone bill has them; same for your cellphone bill. And if you comb your other utility bills, you'll likely find 'em.
And they all add up.
It wasn't always like this. Just ask Yvonne M. Martin of Flint Township, who recently found a Michigan Bell Telephone Co. bill from 1965 while going through some papers.
The bill: $5.53.
In her bill paid Oct. 1, 1965, local service was $4.85 for a month. Add to that a state tax of 19 cents and federal tax of 49 cents to get her total.
"This is just too hilarious compared to what we're doing now," Martin, 68, said.
She now pays about $80 a month for her residential AT&T phone service.
Today's phone bill from AT&T is a lot more complex.
There's the federal access charge, 911 emergency system billing, 911 operational assessment billing and federal universal service fee.

Ryan Garza | The Flint JournalYvonne M. Martin, of Flint, found an old phone bill she paid to Michigan Bell Telephone Company in October 1965 that was $5.53 total.

With two lines (one's for dial-up computer access only), Martin paid $17 during a recent month on the above fees, plus $4.38 in federal and state taxes.
Plus, of course, the charges for a local calling plan, call waiting, line maintenance protection and long-distance charges.
"It's just so unbelievable," Martin, a retired sales representative for Blue Cross Blue Shield, said of her phone bill now vs. then.
"They break it all down now for everything," she added. "Back then, there wasn't all those additional charges."
Martin said she likes the breakdown of her bill but just doesn't like paying all the additional charges.
And consumers such as Martin really have no choice but to pay the pass-along fees from companies. Cutting back on service to lower bills might help some, but for the most part, these charges and fees are here to stay.
Get ready for more changes coming to AT&T bills and cellphone bills effective July 1.
Bills for land-line telephones will get some relief, but owners of cellphones will see a new charge.
The 911 operational assessment fee will drop in Genesee County from $2.40 to $1.24 per land line, but cellphone users and those who use other communication devices, such as VoIP (Voice over Internet Protocol), will begin to pay the fee for the first time, said Judy Palnau, a spokeswoman for the Michigan Public Service Commission.
The change will spread the cost of the surcharge to all phone users.
But Verizon Wireless, which has 65 million customers, is concerned about the added cost to its customers who have multiple cellphones in their plans.
"Families that have three, four, five phone are (paying a) disproportionate amount of fees," said Mike McDermott, executive director of public policy for Verizon's Midwest area.
Verizon breaks down its surcharges for the universal service charge, a regulatory charge and an administrative charge, and taxes in separate areas of its bill and includes a synopsis of the surcharges on its bills.
"It's not a revenue-generating exercise," McDermott said of the surcharges, which offset the company's cost for certain things, such as administration fees and new tower siting.
Cellphone users in Michigan will see a 10-cent relief on their monthly bills beginning in July. A 911 charge for cellphones will drop from 29 cents to 19 cents, Palnau said, but that 19-cent monthly fee now will be added to other wireless devices such as VoIP.
And, added charges affect more than phone bills.
Randy Chamberlain, 52, of Holly, said he's had a hard time understanding all the charges on his Consumers Energy bill. He said charges and taxes add another 15 percent to 20 percent to many of his utility bills.
"It just seems like the taxes are never-ending," he said. "There's tax after tax after tax. The same thing with the satellite bills and such."
Chamberlain said utilities and service providers should explain what the charges are for and why on the bills.
"They're totally unnecessary," he said. "I just think it's a way for the power company to scam the people."
Palnau said it's smart for consumers to monitor their bills.
"It's important that people understand the various parts of their bill," she said.
She suggested using the Internet, including the Public Service Commission's Web site, www.michigan.gov/mpsc, to learn more.
And, for that, at least, there is no fee.

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What are all these phone charges? • Federal universal service fee: A federal charge to make phone service affordable and available to all, including the low income, in areas where the cost to provide service is high and to aid rural health care providers, libraries and schools with telecommunications and/or Internet accessibility. Traditional phone carriers, wireless carriers and Voice over Internet Protocol company providers such as Vonage are required by Congress to contribute to this fund and, while not required by the government, may pass on the cost to consumers. AT&T currently charges 60 cents per month to its customers.
• Federal access charge: Administered by the Federal Communications Commission, this charge covers a portion of the cost to operate and maintain a local phone network. The maximum price a phone company can charge for this is capped by the FCC. AT&T charges its customers $5.37 per month.
• 911 technical charge: In Michigan, this currently is 21 cents per month for land lines and goes to the telephone company to handle 911 billing. AT&T says this helps cover the costs of customer notification, maintenance and equipment.
• 911 operational assessment charge: This charge currently is $2.40 a month for land lines in Genesee County and will drop to $1.24 per land line effective July 1, 2008. Cellphones and other devices such as Voice over Internet Protocol also will begin paying the charge effective July 1. The charge is collected and sent back to the local county to pay for 911 operations. This charge varies by county, and some don't charge one at all because their 911 funding is covered in other ways such as through a millage.
Sources: Michigan Public Service Commission, AT&T and Verizon Wireless