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Understanding Your Telephone Bill

Interpreting Billing Acronyms, Service Terms and Basic Charges

Long gone are the days that telephone bills were simple and easily understood. Today, bills include charges that often are confusing and hard to understand. The following information may help you decipher your landline phone bill.


Monthly Local Service Charge: This charge may also be called the Monthly Fee or the Local Telephone Service charge. It is the basic local telephone service charge and may include unlimited local calling. As a fixed rate, the amount does not depend on usage. Commonly, this fixed charge is billed in advance for the next month of local service. The Minnesota Public Utilities Commission (“MPUC”) determines the amount of this charge for companies which includes most wireline companies but does not include wireless or cell phone carriers -- those carriers are regulated by the Federal Communications Commission (“FCC”).

Federal Subscriber Line Charge or Federal Access Charge: The FCC allows, but does not require, local phone companies to bill customers for some of the costs of the local telephone network. It is not a federal charge or tax. The nature of telephone service is that carriers must interconnect so that consumers located across town or across the country may communicate. This access charge may be used by the local phone company to maintain its local network of wire, poles, and other telephone equipment such that long distance carriers will have access to the local network. It also may appear on bills as the Customer Line Charge, the Interstate Access Charge, Charge for Network Access, or the Interstate Single Line Charge. This charge used to be paid by long distance companies directly to local carriers, but the FCC changed that requirement in 2000 for residential phone lines so that the local phone companies may charge their customers instead. It is worthwhile for a consumer to check with his or her chosen long distance carrier for confirmation that the long distance company is not also charging the consumer for this fee (see PICC, below). The FCC’s current maximum amount is $6.50 per month for the first or primary residential line, with a somewhat higher charge for each multiple residential line and for multi-line businesses. Many local telephone companies charge customers less than the FCC’s maximum amount.

Universal Service Fund: This affordability charge also may be billed as the Universal Connectivity Fee. Congress created this mandatory charge for carriers of voice service between states and internationally including wireless and Voice Over Internet Providers (VOIP) companies, and requires contribution of a percentage of their revenues for providing these services. The carriers may, but are not required to, pass along this charge to their customers. The FCC first implemented this fee in 1998 in order to ensure affordable access to telecommunications services to rural and other high-cost areas for low income persons and to help provide internet access for rural health care facilities, schools and libraries.

Telephone Relay, 9-1-1 & Telephone Assistance Plan Surcharges: These are mandatory fees that local telephone companies must collect from all telephone service subscribers. The state distributes the monies collected to agencies that operate the following services:

Local Number Portability Fee: The FCC allows, but does not require, local telephone companies to collect certain costs associated with customers choosing to keep their existing telephone number when switching to another local provider. Many local companies no longer charge this fee because they already have recouped their allowable amount as determined by the FCC some years ago when number portability became available.


Other Local Charges: Customers may subscribe to additional services through their local telephone company such as: Directory Assistance, Operator-Assisted Calls, Various Calling Features such as CallerID and Three-Way Calling, and for non-listed or non-published telephone numbers.


Many local telephone companies provide billing services to long distance companies. This means that a customer’s telephone bill may include charges from multiple companies for local as well as long distance charges. The charges may include “local” long distance calls made within the state as well as charges for “1+” long distance calls made between states or internationally. Make sure that the name of your selected long distance carriers appear on your bill.

Non-Telecommunications Charges: Many telephone bills include unrelated services such as high speed internet or satellite television. When a customer makes a partial payment of such a bill and clearly notes that the partial payment is to be applied first to local service charges, the customer may not be disconnected from local service for nonpayment of these other charges.

Unauthorized or “Crammed” Charges: Scrutinize your bill for accuracy. Some erroneous charges may be inadvertent, but others may be intentional. Either way, you are not liable to pay for services or merchandise that you did not authorize. This Office filed comments with the FCC in which we detailed the concerning and apparently widespread practices of both wireline and wireless crammers. On July 12, 2011, the FCC published its intention to propose rules to help consumers identify and prevent “mystery fees” or other unauthorized charges on phone bills.

More Questions About Your Phone Bill? Call your providers for explanation of any fee or charge that you don’t understand or question. If you remain concerned, you may file a complaint with these government agencies:

Minnesota Attorney General's Office
445 Minnesota Street, Suite 1400
St. Paul, MN 55101
(651) 296-3353
TTY: (651) 297-7206
TTY: 1-800-366-4812

Federal Trade Commission
Consumer Response Center
600 Pennsylvania Avenue NW
Washington, D.C. 20580
(877) 382-4357

Federal Communications Commission
445 12th Street, SW
Washington, D.C. 20554
(888) 225-5322

Minnesota Public Utilities Commission
121 Seventh Place East, Suite 350
St. Paul, MN 55101
(651) 296-7124 or (800) 657-3782

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