Calls Made From
                       Payphones
                  ____________________



The Communications Act requires the FCC to take actions to promote
competition among payphone service providers and the widespread
deployment of payphone services to the benefit of the general public.  The
Act also requires the FCC to ensure fair compensation to payphone service
providers for each and every call placed from payphones.

A payphone service provider is the person or entity who owns the payphone
instrument, such as the local telephone company; an independent company;
or the owner of the premises where the payphone is located.  Payphone
service providers are called "PSPs" in this brochure.

This brochure explains the actions the FCC has taken to carry out its
responsibilities.

              Are The Coin Rates For Local
            Calls From Payphones Regulated?

No.  Effective October 7, 1997, the FCC deregulated coin rates for all local
calls made from payphones.

Prior to 1996, most payphones were provided by local telephone companies
and received indirect subsidies through the rates paid by consumers for
other types of services.  States regulated the coin rate for a local call.

The resulting artificially low prices tended to discourage new companies from
entering the payphone market and also limited the number of payphones
available for the benefit of the public.

In 1996, Congress required that payphones no longer be subsidized in order
to encourage competition and the greater availability of payphones.

The FCC determined that deregulating local coin rates and allowing the
marketplace to set the price of local payphone calls is one of the essential
steps needed to achieve the goals set by Congress.

Deregulation will allow PSPs to receive fair compensation for their services
and will encourage the widespread placement of payphones.  Also, the FCC
anticipates that Americans will have greater access to emergency and public
safety services.  States may also choose to place public interest payphones
in areas where payphones are necessary for health and safety reasons.

The Commission intends to actively monitor the payphone marketplace by
regularly meeting with representatives from the states, PSPs, and consumer
advocates.

           Must I Pay For An Emergency Call?

No.  Calls made to emergency numbers, such as 911, and to the
Telecommunications Relay Service, a service of use to people with
disabilities, will be provided free of charge from payphones.  You can also
continue to reach an operator without depositing a coin.

               Can I Still Make Toll-Free
              Calls From Payphones Without
                   Depositing A Coin?

Yes.  However, the Communications Act requires the FCC to establish a per-
call compensation plan to ensure that all PSPs are fairly compensated for
each and every completed intrastate and interstate call using their payphone
-- except for emergency calls and telecommunications relay service calls for
hearing disabled individuals.  Prior to 1996, PSPs often received no
compensation for completed intrastate and interstate calls -- including
completed toll-free calls -- no matter how frequently callers used payphones
to originate calls.

The FCC carried out its responsibilities by adopting rules that require long
distance telephone companies to compensate PSPs 28.4 cents for each call
they receive from payphones, except those calls for which the PSPs already
collect compensation under a contractual arrangement.  Payphone-
originated calls that are unlikely to be the subject of a contract with the PSPs
include calls to 800 telephone numbers or 10XXX access code calls which
connect callers to long distance telephone companies.

The 28.4 cents per-call compensation rate is a default rate that can be
reduced or increased at any time through an agreement between the long
distance company and the PSP.  The FCC encouraged long distance
companies and PSPs to contract with each other for more economically
efficient compensation rates.

Some long distance companies are advising consumers that the FCC
decided that consumers making calls from payphones should pay a per-call
charge to compensate the PSP.  The FCC did not make such a decision.
Long distance companies have significant leeway on how to compensate
PSPs.  The FCC left it to each long distance company to determine how it
will recover the cost of compensating PSPs.

              Tips For Consumers

     Companies compete for your payphone business.  Use your buying
power wisely and shop around.

     If you think that the rate for placing a call from a payphone is too high,
a less expensive payphone could be around the corner.  Also let the
PSP know that the rates are too high.  It's in their best interest to meet
the needs of their customers.

     Contact your preferred long distance company and ask for
instructions for placing calls through that company from a payphone.
Also ask what rates or charges apply to calls placed from payphones.
Let the company know if you believe their rates are too high.  Then
call other long distance companies and ask about their rates.