Delco sues telecom providers over withheld fees

Delaware County has filed a lawsuit against 19 Pennsylvania telecommunication providers, alleging that the county has been shorted $41.4 million in 911 fees over the last six years.

Filed Monday in Delaware County Court, the suit accuses the providers of withholding fees collected from customers and earmarked for county emergency services. Among those named are Verizon Communications Inc., AT&T Inc., Windstream Communications Inc., and Comcast Phone of Pennsylvania.

The suit, filed more than a month after the county began making its concerns public, largely targets carriers that serve large businesses with multiple land and wireless lines.

The county alleges that rather than charging a large company for each landline capable of making an outgoing call, telecom carriers charge only for one main line that serves a building.

If a "line is capable of supporting 23 separate outgoing calls, the provider should charge its customer for 23 lines," the suit says. The companies have "nevertheless intentionally, knowingly, recklessly, and/or negligently failed to do so."

The county also alleges that providers misclassified the services they provide to customers and therefore do not collect the proper 911 fees.

The suit has drawn skepticism from providers and politicians. Delaware County officials and filing lawyer Joshua Wolson of Dilworth Paxson declined to comment Monday.

State Rep. Steve Barrar (R., Delaware), who has sponsored legislation this year to revitalize Pennsylvania's emergency services, said Monday that as the state's emergency services law stands, discounts are offered to telecom customers with multiple lines, including businesses.

Under state law, customers in Delaware County and the Philadelphia area are typically charged $1 per month on each landline and mobile device. But a provision states that "customers purchasing multiple dial-tone telephone access lines" will receive a larger discount on fees when more lines are purchased.

"I tried to explain that to them, but they didn't want to listen to me," Barrar said. "I'm not really sure what their thinking is."

Spokesmen for Windstream and Comcast would not comment. A Verizon spokesman said Verizon is skeptical of the company the county used to assess how much money is allegedly owed by providers.

Delaware County spokeswoman Trisha Cofiell said the county worked with the forensic telecom company Phone Recovery Services L.L.C., which has emerged as a major player in lawsuits against telecom providers.

In 2014, Phone Recovery Services filed a lawsuit on behalf of the District of Columbia, similarly alleging providers had failed to pay $29 million in fees.

"We question the motivations of this so-called forensic expert," said Lee Gierczynski, a spokesman for Verizon. "This so-called forensic expert has a financial incentive to pursue these types of cases."

Verizon is accused of failing to remit $1.38 million annually.

Emergency services are being transformed in Pennsylvania and across the country. Barrar's legislation, which proposes increasing the monthly 911 fee to $1.65 across the state, would also move Pennsylvania toward "next generation 911" technology, such as using text messages to report emergencies.

The suit said new technology "will dramatically increase the burdens faced by the 911 systems, both in terms of the volume of communications handled and in terms of the technological and personnel requirements for handling them."

In 2014, Delaware County spent nearly $15.6 million on emergency services. The department handles more than one million calls per year.

Delaware County has alleged that providers' failure to remit 911 charges has forced the county to dip into its $338 million general fund - supplied primarily by property taxes - to pay 911 bills. In 2014, the county said, it took $7 million from the general fund.

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