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Wireless Dealer Magazine CITA 2013 Issue

W D M complications associated with collection of fees from prepaid customers. Under the point of sale collection model, the fee is imposed only on retail transactions, and collected only when prepaid wireless services are sold directly to a consumer. The fee either represents a percentage of the retail sale price or a flat per transaction rate. In 2008, the industry presented the model legislation to the National Conference of State Legislatures (“NCSL”), which, after three public hearings, endorsed the legislation in July 2009. As of March 2012, nineteen states had adopted the NCSL model act for E911 fees. The model legislation imposes an E911 fee (either flat or percentage-based) on each “retail transaction” defined as “the purchase of prepaid wireless telecommunications service from a seller for any purpose other than resale. ” The legislation provides that sellers must collect the fee from customers and list it on customer invoices or otherwise disclose the fee to customers. The model further provides that the fee will be treated as having been collected even if it was not separately listed on a customer’s invoice, rendering the seller liable for uncollected fees. While most retailers oppose the point of sale collection model, Wal-Mart has publicly endorsed the NCSL proposal. Mississippi, pennsylvAniA, souTh CArolinA, Tennessee, indiAnA, norTh CArolinA, virginiA And WisConsin iMpose A flAT surChArge per reTAil TrAnsACTion, ColleCTed AT The poinT of sAle, rAnging froM $0.25 to $1.00. In general, the prepaid industry supports point of sale laws because they impose the collection responsibility on retailers, as opposed to the service providers. Point of sales models still require prepaid wireless service providers to collect E911 fees on direct sales to consumers, such as recharges or online sales. While not all states have adopted this approach, a number currently apply, are considering applying, or have adopted point of sale laws with future effective dates. For example, Arizona, Colorado, DC, Illinois, Louisiana, Michigan and Texas apply a fee calculated as a percentage of the retail sale price ranging from 0.8% to 7%. Connecticut currently applies a per-line fee, but effective January 1, 2013 will begin point of sale collection. Mississippi, Pennsylvania, South Carolina, Tennessee, Indiana, North Carolina, Virginia and Wisconsin impose a flat surcharge per retail transaction, collected at the point of sale, ranging from $0.25 to $1.00. 143


Wireless Dealer Magazine CITA 2013 Issue
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