Cobb County will not collect millions of dollars from telephone companies over 911 charges after a state Supreme Court decision Monday.
In December 2015, Cobb and Gwinnett counties sued several telecoms: BellSouth Telecommunications, LLC, doing business as AT&T Georgia; EarthLink, Inc.; EarthLink, LLC; Deltacom, LLC and Business Telecom, LLC. The counties, represented by former Georgia Gov. Roy Barnes, said the companies did not bill certain kinds of customers enough, specifically businesses with multiple phone lines.
The county attorneys said the companies were undercharging those customers to increase their profits.
Their arguments rested on Georgia’s 1977 911 Act, which created a statewide 911 service and authorized local governments to pay for the services by imposing a monthly charge on telephone service.
The law states that telephone customers “may be billed for the monthly 911 charge” up to $1.50 for each subscription per telephone service provided.
Central to the case was whether the charge was a tax or a fee. A county cannot implement a tax without approval from the state Legislature.
The counties argued they are fees, but the companies called them taxes, and said the counties were going beyond their purview in charging them.
The Gwinnett County Superior Court denied the phone companies’ motions and ruled in favor of Cobb and Gwinnett counties, ruling that the 911 charges are fees, not taxes.
After going through the Georgia Court of Appeals, the phone companies came before the Georgia Supreme Court last August.
The justices decided the charge was a tax and ruled that it is the Legislature’s prerogative to collect taxes.
“We conclude that the charge is a tax and that the 911 Act does not give the counties a right of action to collect that tax from the telephone companies,” Justice Nels S.D. Peterson wrote in the 24-page opinion.
With the opinion, the high court has reversed a decision by the Georgia Court of Appeals and is sending the case back to the intermediate appellate court for dismissal.