DNC Access Fees May Rise Again; ATA, DMA Vow to Fight

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WASHINGTON -- The Federal Trade Commission announced a proposal last week to raise access fees for the national no-call registry yet again, drawing protests from the American Teleservices Association and Direct Marketing Association.


The organizations told ATA members gathered here for the annual ATA Washington Summit at the Hyatt Regency on Capitol Hill that they would ally to oppose the proposed increase.


"The ATA and DMA are in lockstep on this issue, no question," said Jim Conway, DMA vice president of government relations. "This is one place where the new era of dialogue is fortuitous."


The ATA and DMA also pledged to work together to petition the Federal Communications Commission to declare interstate telemarketing calls outside the jurisdiction of the states. States have created differing telemarketing rules that the industry says make compliance difficult.


The FTC's proposed fee increase would raise the per-area-code cost for registry access from $45 to $56. The maximum payable fee for 280 area codes or more would climb from $12,375 to $15,400.


Before the registry's launch, the FTC had proposed fees of $12 per area code with a maximum of $3,000. But after revising its cost estimates, the FTC raised the proposed access fee cost.


When the registry launched in October 2003, these fees were $25 per area code and a maximum of $7,375. In 2004, the FTC proposed to raised the fees to their current levels, which took effect Jan. 1, 2005.


In January 2005, the General Accountability Office released a report on the no-call registry that included a cost analysis. It found that the FTC spent $14.6 million on the registry in federal fiscal year 2003 -- which ended Sept. 30, 2003, and included the preparation period before the launch -- and collected only $5.2 million in fees.


The FTC covered the $9.4 million shortfall with money from its taxpayer-funded budget. In the registry's first official year of operation -- fiscal year 2004, from Oct. 1, 2003, to Sept. 30, 2004 -- the FTC collected $14 million in fees, just enough to cover its no-call budget for the year.


The FTC has said the higher fees are needed because more telemarketers qualified for free access to the registry than expected while fewer telemarketers than expected have paid. Telemarketers that access five area codes or fewer, as well as nonprofit telemarketers, are exempt from the fees.


However, the DMA estimates that as many as 20 million of the 88 million telephone numbers on the registry belong to cell phones, Conway said. Many of those cell phones were registered due to e-mails circulating among consumers falsely claiming that a directory of cell phone numbers soon would be published and made available to telemarketers.


Telemarketing to cell phones without express consent is already illegal, so it makes no sense to have them on the registry, Conway said. But telemarketers pay the cost of housing those numbers on the registry.


The DMA and ATA also are working on a petition to the FCC asking it to declare that interstate telemarketing calls are outside the states' jurisdiction, said Mitch Roth, ATA government affairs counsel.


The FCC initially said it would consider state laws that contradict federal law on a case-by-case basis but is realizing that this process is too cumbersome and lengthy, Roth said. The DMA and ATA are sending the petition to the FCC together and are asking members to sign it as well, he said. The ATA hopes to send the petition by the end of April.


The ATA leadership asked members to open their doors to lawmakers. The association needs members to give tours of their operations to lawmakers at all levels of government to push the message that the industry benefits the economy and public, ATA leaders said.


"Not many people know exactly what we do," said William Brierly, executive director of governmental and regulatory affairs for TeleTech and head of the ATA's federal legislative subcommittee. "Not many people know how many people we employ."


Members should arrange meetings with lawmakers before legislation is proposed, said Joseph Sanscrainte, general counsel for Call Compliance Inc. and chairman of the ATA's state legislative subcommittee. Evidence suggests that state lawmakers can be swayed, even by telephone calls.


"Phone calls are a very effective way of lobbying," Sanscrainte said. "We all have the expertise and ability to pick up the phone and contact people, and we're very good at it. So let's do it."


Scott Hovanyetz covers telemarketing, production and printing and direct response TV marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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