Point-of-sale laws could be a license to raid
Last week, I wrote about the progress that has been made regarding the prepaid wireless dilemma as it relates to 911 surcharge fees. Three states last year passed laws that require retailers to collect the fee at the point of sale for every prepaid cellular device that they sell. Another eight states enacted such laws this year, while four more have legislation pending. Previously, there was no mechanism to collect the fee from prepaid wireless users, because they aren’t billed for service on a monthly basis, as are post-paid customers.
That’s the good news. The bad news is that states still are raiding 911 funds and diverting them to other purposes. And of the states that are supporting POS collection of 911 surcharge fees, five of them were among those identified last year as raiders.
That strikes me as being analogous to handing the fox the keys to the henhouse. I can just imagine the expression on the face of the first public official who figured out that a POS law would generate even more money that could be raided.
Sometimes the diverted money goes into the general treasury to offset a budget deficit. Sometimes it’s used to buy much-needed gear for first responders. That doesn’t matter, according to Dane Snowden, vice president of external and state affairs for CTIA, which has been working with public safety to try to put a stop to the raids. He told attendees of the National Emergency Number Association (NENA) annual conference held in Indianapolis last week that more than $88 million was siphoned from the 911 sector last year alone.
CTIA, which lobbies on behalf of the commercial wireless carriers, believes the raiding practice cheats wireless subscribers, Snowden said.
“Citizens are paying for something that they’re not getting,” Snowden said. “We think that’s a travesty.”
Sandy Gilstaff, 911 administrator for the Pinal County (Ariz.) Sheriff’s Office, also thinks it’s a travesty. Pinal County is wedged in the south-central portion of the state, between Phoenix and Tucson. According to Gilstaff, the county is roughly the size of Connecticut, with a population of about 350,000. Its public-safety answering point handled about 125,000 emergency calls last year and has an operating budget of about $1 million.
Like most of the country, Pinal County has been affected by the severe economic recession of the past couple of years. Gilstaff’s PSAP likely will run at a budget deficit next year because of sharply declining revenues — and because the state has diverted 911 fees. According to Gilstaff, $12 million was siphoned in fiscal year 2003, $3 million in 2004 and $25 million last year. This year, another $9 million is expected to be diverted, she said, adding that even grant money was taken.
Pinal County is looking at next-generation 911 and would like to expand its mapping capabilities, but the funding well is dry, Gilstaff said. She fears that the budget crisis already is having an adverse effect on the center’s operations. One could hear the despair in her voice when she said, “We can’t look at any project that has a recurring cost. We can’t even provide the basic service that every American should have. Citizens and 911 dispatchers both suffer when the funding isn’t there.”
Both Snowden and Gilstaff are correct — this is a travesty. But what can be done about it? Congress made a completely ineffective attempt at stopping the raiding a couple of years ago by enacting legislation that made any state that diverts 911 funds to other purposes ineligible to receive federal grant money for PSAP upgrades. It was no deterrent at all. That’s because Congress in 2004 authorized $1.25 billion over a five-year period for such upgrades, but only appropriated about $44 million. While every state received grant money, the amount each received was a pittance — especially when compared to the millions some were able to grab by raiding the 911 funds. This is a little like trying to get a teenager to toe the line by threatening to take away the family car that’s sitting on blocks in the garage.
I spoke with another panelist, Laurie Flaherty — program analyst for the National Highway Traffic Safety Administration’s Office of Emergency Medical Services — after the session. Flaherty, previously co-manager of the Department of Transportation’s NG-911 Project, passed along a notion that was floated recently by a National Conference of State Legislatures policy specialist. Apparently, several states have laws that designate police, fire and EMS as essential government services, which means that their funding can’t be raided. According to Flaherty, she was told that such designations can be found in some state constitutions. So, the notion goes, designating 911 services in the same manner could be a way to stop the piracy.
Philosophically and logically, this seems to make a lot of sense. Who could argue that 911 services aren’t essential? On the other hand, what would possess any state that has been raiding 911 funds to enact such legislation? That would be like handing a child a tube of adhesive and then asking him to voluntarily glue the lid to the cookie jar shut.
So it’s probably going to take some sort of federal intervention to stop state legislatures from cheating the 911 sector. According to Flaherty, a good place to start would be for Congress to fulfill the promise it made six years ago.
“It certainly would be helpful if the money was found to appropriate this program fully,” Flaherty said. “It would provide, whether you call it a carrot or a stick, [a deterrent].”
In the meantime, perhaps Congress could consider a sanction that actually would cause raiding states some pain, such as making them ineligible for highway or school funding. I’d be willing to bet that would stop the practice.
What do you think? Tell us in the comment box below.