Rhode Island's Diversion of 911 Fees Draws Criticism

In its budget for the fiscal year that begins July 1, the administration proposes using less than half of the $17 million that will be generated from landline and wireless telephone customers in the coming year for 911 operations, housed at state police headquarters.

by Jim Hummel The Hummel Report, The Providence Journal, R.I. / April 12, 2019

(TNS) — Despite warnings from federal officials, and a pledge a year ago to support moving 911 telephone surcharges into a restricted account, Gov. Gina Raimondo's administration continues to divert millions of dollars in fees to the state's General Fund, with the blessing of the legislature.

In its budget for the fiscal year that begins July 1, the administration proposes using less than half of the $17 million that will be generated from landline and wireless telephone customers in the coming year for 911 operations, housed at state police headquarters.

"We're committing a deceptive practice when we don't use every dollar for 911," said Robin Giacomini, of North Providence, who is on a mission to have all the money collected go to 911 — or to have the state lower the surcharge on consumers.

Giacomini works as a health-care professional in diagnostic imaging. She became interested in the 911 issue last year when she read stories about the diversion of fees. Giacomini was also concerned that underfunding might hamper the agency's efforts to bring on new technology, and to hire nurses to work alongside call-takers as they talk callers through various emergencies, as has been done in other parts of the country.

She has teamed up with former Rhode Island Department of Health Director Michael Fine to take a closer look at the 911 operations. Over the last year, Giacomini has written the state budget office, legislative leaders and the governor's office with detailed financial analyses of what Rhode Island is doing with the fees. She's researched federal codes regarding 911 fees and how the surcharges are handed in other states.

Her efforts have been met with across-the-board silence from all the officials she contacted, despite repeated follow-ups.

"Our governor, she's an educated, intellectual individual." Giacomini said. "[Speaker Nicholas] Mattiello is an attorney. He should know this. So is it ignorance, or is it intentional negligence? If it's intentional negligence, that's pretty bad."

Giacomini also discovered last month that a 14-member advisory commission established when E-911 was created in the mid-1980s hasn't met for seven years. Rhode Island State Police Supt. James Manni — who oversees the 911 system as director of the Department of Public Safety — vowed to resuscitate the commission when The Hummel Report asked him about it earlier this month.

Raimondo said this week that she supports putting the 911 telephone surcharges in a restricted-receipt account, but added that it's up to the General Assembly to change the law to make that happen. She said the same thing a year ago when the issue came up in the legislature.

"I would sign it. It's more transparent," Raimondo said. "That's the legislature's job. My job is to make sure [911 is] well-run, it's well-managed and that people are well-trained. I would be very much in favor of a restricted-receipt account so people could see, fully transparently, how it was being spent."

A bill was filed last month that would create the restricted-receipt account or lower the surcharge to eliminate taking in more money than was being used. Through a spokesman, Speaker Nicholas Mattiello said he has not taken a position on the legislation.

In response to the governor's comments, Mattiello said: "If the Governor wanted to create a restricted-receipt account, she could have proposed it as part of her budget earlier this year. If she submits an amendment to create such an account, as well as a plan how to fill the budget shortfall it would create, the House Finance Committee will consider it as part of the budget process."

In 1986, the General Assembly passed "the 911 Emergency Telephone Number Act," which paved the way for statewide 911 to begin operating in late 1988; it was governed by a separate authority. The federal government gave Rhode Island the authority to assess a surcharge on every phone line (initially 42 cents per month), which was deposited into a restricted-receipt account to be used exclusively for 911. In 1997, responsibility for the agency was transferred from the authority to the executive branch.

The state increased the surcharge to 47 cents per month in 1996, then to $1 per month in 2002, which is what it is today. Cellphone users pay $1.26, which includes 26 cents for a GIS (Geographic Information System) and Technology Fund, tacked on in 2004.

A shift in philosophy came in 2000, when the General Assembly eliminated the restricted-receipt account and had all the 911 funds — about $5 million at the time — transferred into the General Fund. Since then, more than $100 million has been diverted from 911 for other uses in state government.

The proliferation of cellphones over the last 15 years has caused those revenues to swell to between $17 million and $18 million annually. The budget this year for 911 is $6.9 million.

Giacomini says the federal regulations allowing individual states to enable third-party billing by the phone companies are clear: fees should only be used for 911. But the Federal Communications Commission has limited enforcement power, according to Commissioner Michael O'Rielly, who traveled to Rhode Island a year ago for what was billed as a "911 Summit."

He came at the request of former state Rep. Robert Lancia, who had filed legislation to return the 911 funding to a restricted-receipt account. O'Rielly said at the time that state officials were "stealing" some of the 911 fees.

"You have states that are deceiving the consumers. They are calling it this fund and it's not, and Rhode Island falls into that category," O'Rielly told The Hummel Report in a telephone interview last month. He said Rhode Island, New York and New Jersey are the biggest "diverters" of 911 fees to other uses.

But the FCC's only leverage to force compliance is denying future federal funding for technology upgrades known as Next Generation 911. O'Rielly said the federal government has set aside more than $100 million to help states with the upgrade, but he acknowledges that the total price tag will be billions of dollars over many years. He is lobbying Congress to begin appropriating more money. If Rhode Island continues diverting 911 fees, it will not have access to that funding.

"No one is calling for [Rhode Island] to triple their budget, but they're going to need to make a huge investment in the NG 911," he said. "Most states have been circling the federal government saying, 'We want more federal dollars being put in because we can't afford it.' And here's a situation where if they set aside that money, they'll have the money to go and buy the equipment."

O'Rielly toured the 911 center in Scituate during his visit last year and had what he considered positive conversations with the governor's staff. Raimondo's office issued a news release on March 19, 2018, that said, "if the Rhode Island General Assembly were to consider reforms, including action to reinstate a restricted-receipt account for E911" the administration would support it.

Instead, the General Assembly, as part of the budget discussions a few months later, simply renamed the 911 surcharge "The Emergency Services and First Response Surcharge." House Spokesman Larry Berman, in an email, said it reflects the current use of the funds for emergency services and first-responder agencies under the Department of Public Safety.

O'Rielly called that "papering over" the problem. "I was disappointed with the governor; we had positive conversations with her [office], and she was supportive of the change. And then she was like, 'Well, the legislature does it and I'll go along.' Well that's not what you said before. And your staff had led us to believe that you were supportive of [creating a restricted account]."

The legislative renaming has not been communicated to the telephone companies. The bills still say "RI State 911 Tax." There is no mention of first responders or emergency services.

A recent Verizon bill sent to a Rhode Island customer reads: "This is a fee that Verizon is required or authorized by government agencies to collect from customers. The government agencies use the funds collected to cover the costs of providing 911 emergency response."

When asked what the process was for dealing with the telephone companies, Department of Taxation spokesman Paul Grimaldi said in an email: "We collect the revenue and work to ensure that there is compliance. As for what a particular business puts on its bill for a customer to see, it's incumbent on each business to use what form and format makes sense to them."

Giacomini says it's a double standard for the state.

"The state of Rhode Island would not allow Tide [detergent] to label their bottle at 100 ounces and fill it at 45 ounces and sell it to you," she said. "That's exactly what they're doing. So you're paying the dollar on your phone bill, thinking that whole dollar is going to 911. There's something called the Truth in Billing Act. It's telling the telecomm, you have to tell everybody the truth on where that money is going. The state of Rhode Island isn't absolved from that responsibility."

She notes that while the federal government gives states the authority to tack on a surcharge, many states pay for their 911 systems as part of their budgets with no surcharge, or a partial surcharge.

Giacomini sent a detailed email in January to Patrick J. Crawley, a budget analyst in the state's Office of Management and Budget, with a financial analysis and a series of questions. She received no response.

When The Hummel Report contacted Department of Administration spokeswoman Brenna McCabe, forwarding Giacomini's Jan. 16 email, she wrote back: "My sincerest apologies to Ms. Giacomini. This inquiry was passed along to me, and it appears I did not respond. It was not purposeful. I am more than happy to speak with her and get answers to her questions as soon as possible."

Giacomini sent another detailed email on April 4 and is waiting for an answer.

Meanwhile, funding for 911 itself has increased by more than $1.5 million over the last two years. A Hummel Report investigation in 2011 discovered not only the diversion of fees into the General Fund, but that the agency was severely underfunded — resulting in a chronic staff shortage. We reported that 13,000 people who called 911 the previous year had been put on hold, for an average of 11.5 seconds.

We also discovered that 911's budget had been cut from a high of $6 million to $4.6 million, even though the state was collecting $16 million in surcharges at the time.

The state police's Manni says that has changed significantly: 911 has added six call-takers and a supervisor over the last year, for a total of 34 call-takers and eight supervisors. The proposed budget for next year is $$6.8 million.

Manni, who took over in March and is doing a top-to-bottom assessment of the Department of Public Safety, said that 911 is at the top of the list. He said that a revived 911 advisory commission would offer a fresh perspective to guide that process.

"It's an advisory board," he said. "It would tell us where our deficiencies are and where our strengths are."

Giacomini said if the commission had been active, it might have addressed the diversion of 911 funding, since the surcharges had been going into a restricted account for more than a decade.

"Massachusetts and Alabama are the two best [911] systems: a dedicated fund ... and then there's an oversight committee of all the integral government bodies," she said.

Last month, state Rep. John Lyle, a Republican from Lincoln, filed legislation that would require all surcharges to be put in a restricted-receipt account and only used for 911, or to have the Public Utilities Commission reduce the surcharge on customers' bills.

Berman, Mattiello's spokesman, says the speaker has not taken a stand on the bill, which has been referred to the House Finance Committee. If the state does put the excess money in a restricted account, Berman said, it will have to find an additional $10 million somewhere else to balance next year's budget.

We asked Raimondo if the state has been reluctant to make the necessary changes to the law because it is addicted to the revenue. "You would say addicted. I would say it's being invested in public safety, which is keeping Rhode Islanders safe," Raimondo said, noting that there has been a substantial increase in the agency's budget over the last two years.

Why not reduce the surcharge to customers? "Because we need the money to do important things," Raimondo said. "I mean, that's like saying: Why not lower taxes?"

Giacomini said the governor and the speaker are missing the point.

"What don't they understand about the surcharge itself?" she said. "Why do they assume they can spend it any way they want when they're being told they're not allowed to?"

The Hummel Report is a 501(c)(3) nonprofit organization that relies, in part, on donations. For more information, go to HummelReport.org. Reach Jim at Jim@HummelReport.org.

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