OPINION OF THE COURT
The individual petitioners are family members and/or friends of inmates incarcerated within the New York State prison system. The Office of Appellate Defender and the New York State Defenders Association are nonprofit organizations which provide legal services to state inmates. All petitioners are or have been recipients of collect telephone calls from state inmates. The petitioners argue that they are being overcharged for the collect telephone calls which they receive.
Pursuant to a contract dated April 1, 1996 with MCI,
In April 2001, MCI and DOCS entered into a new contract that required MCI to continue charging the same rate, but decreased the commission collected by DOCS from 60% to 57.5% of MCI’s gross annual revenues. In May 2003, DOCS and MCI agreed to amend the 2001 contract, to leave the 57.5% commission intact, but introduce a flat rate for all calls without regard to the time of day or distance of the call (160 per minute with a
Upon commencement of the instant proceeding, the respondents made a motion to dismiss pursuant to CPLR 7804'(f) and 3211 (a) on grounds, inter alia, that the proceeding was time-barred under CPLR 217. The court, by decision/order/judgment dated October 8, 2004, found that the proceeding was untimely and dismissed the petition. The Third Department, Appellate Division, affirmed (see Walton v New York State Dept. of Correctional Servs.,
It is well settled that, in response to a motion pursuant to CPLR 3211, pleadings shall be liberally construed, the facts as alleged accepted as true, and every possible favorable inference given to plaintiffs (see Nonnon v City of New York,
In addition, where declaratory relief is requested, “[i]n deciding a motion to dismiss for failure to state a cause of action, a court must liberally construe the allegations to determine if a bona fide justiciable controversy exists” (Matter of Niagara Mohawk Power Corp. v State of New York,
Violation of Power To Tax (Count II)
Count II of the petition alleges that DOCS exceeded its power by imposing an unlawful tax upon the petitioners through the collection of the DOCS commission, in violation of New York
Public Service Law § 97, entitled “Rates, rentals and service,” recites as follows:
“1. Whenever the commission shall be of opinion, after a hearing, had upon its own motion or upon a complaint that the rates, charges, tolls or rentals demanded, exacted, charged or collected by any . . . telephone corporation subject to its jurisdiction for the transaction of messages or communications by . . . telephone or for the rental or use of any . . . telephone line . . . wire, appliances, apparatus or device or any telephone receiver, transmitter, instrument, wire, cable, apparatus, conduit, machine, appliance or device or any telephone extension or ex-tention system or that the rules, regulations or practices of any . . . telephone corporation affecting such rates, charges, rentals or service are unjust, unreasonable or unjustly discriminatory or unduly preferential or in anywise in violation of law, or that the maximum rates, charges or rentals chargeable by any such . . . telephone corporation are insufficient to yield reasonable compensation for the service rendered, the commission shall, with due regard, among other things, to a reasonable average return upon the value of the property actually used in the public service and to the necessity of making reservation out of income for surplus and contingencies, determine the just and reasonable rates, charges and rentals to be thereafter observed and in force as the maximum to be charged, demanded, exacted or collected for the performance or rendering of the service specified notwithstanding that a higher or lower rate, charge or rental has been theretofore prescribed by general or special statute, contract, grant, franchise condition, consent or other agreement and shall fix the same by order to be served upon all telegraph corporations and*780 telephone corporations by which such rates, charges or rentals are thereafter to be observed, and thereafter no increase in any rate, charge or rental so fixed shall be made without the consent of the commission. Any such change in rate, charge or rental shall be upon such terms, conditions or safeguards as the commission may prescribe.”
Distilled to its essence, Public Service Law § 97 (1) recites that the PSC “shall . . . determine the just and reasonable rates . . . to be thereafter observed and in force as the maximum to be charged . . . notwithstanding that a higher or lower rate, charge or rental has been theretofore prescribed by general or special statute, contract, grant, franchise condition, consent or other agreement” (emphasis supplied).
From the foregoing, it would appear, on the very face of the statute, that the Public Service Commission has full authority, indeed paramount authority, to review a given telephone rate. This is borne out by the language employed by the Court of Appeals in Matter of Cahill v Public Serv. Commn. (
“A public utility is franchised by the State (Public Service Law §§ 68, 99) to provide services to the public at just and reasonable rates (Public Service Law §§ 65, 91) in exchange for a proper return on its investment (see, Public Service Law § 97; Matter of Village of Boonville v Maltbie,272 NY 40 ). Operating as a monopoly (see, People ex rel. New York Edison Co. v Willcox,207 NY 86 , 93-94), it is subject to regulation by the PSC (Public Service Law §§ 66, 94). The PSC oversees the utilities for the public good as an exercise of the State’s police powers (People ex rel. New York Elec. Lines Co. v Squire,145 US 175 ) and has exclusive authority to determine just and reasonable rates (Public Service Law § 66 [12]; § 92 [2]). It establishes maximum rates which may not be exceeded (Public Service Law § 65 [1]; § 91 [1]). In fact, no utility may charge more or less than the rates established by the PSC (see, Public Service Law § 66 [12]; § 92 [2]).” (Matter of Cahill v Public Serv. Commn. at 271-272; see also Matter of New York Tel. Co. v Public Serv. Commn. of State of N.Y.,271 AD2d 35 , 39 [3d Dept 2000], lv denied95 NY2d 762 [2000].)
Notably, it has been held that it is appropriate for the PSC, in reviewing a proposed tariff, to examine the utility’s underlying
“The [public service] commission has been empowered to determine ‘just and reasonable’ telephone rates (Public Service Law, § 91, subd. 1; § 97, subd. 1) and, as the United States Supreme Court noted many years ago, the rate-making power is" not ‘subservient to the discretion of [a utility] which may, by exorbitant and unreasonable salaries, or in some other improper way, transfer its earnings into what it is pleased to call “operating expenses.” ’ (Chicago & Grand Trunk Ry. Co. v. Wellman,143 U. S. 339 , 346, supra.) Particularly when those expenses arise out of dealings between affiliates, the commission ‘not only [has] the right but the duty to scrutinize [such] transactions closely’. (Matter of Long Beach Gas Co. v. Maltbie,264 App. Div. 496 , 504, affd.290 N. Y. 572 , supra.) And, in this connection, we find significance in the statutory requirement that the agency be given access to the records of all transactions between telephone companies and their affiliates (Public Service Law, § 110, subd. 2).
“So far as rate making is concerned, it is of no consequence that the Legislature has declined to go further and provide for regulation by the commission of the very terms and conditions of all contracts between affiliates. The primary purpose of such regulation is to protect the corporation’s treasury and to preserve its financial integrity. The function of the rate-making power, however, is to protect the utility’s rate payers. In the proper exercise of that power, the commission does not require the authority to invalidate contracts. All that is required — and, indeed, all that is given — is the authority to disregard unwarranted payments to affiliates when calculating the ‘just and reasonable’ rates which the telephone company will be permitted to charge to its subscribers. The treatment thereby accorded to the affiliates’ over*782 charges is no different than in any other case ‘where the commission and management disagree on the reasonableness of an expenditure, and the management concludes that it is good business judgment to make such payments from its profits despite the fact that it cannot recoup them from its rate payers’. (Pacific Tel. & Tel. Co. v. Public Utilities Comm.,34 Cal. 2d 822 , 832, supra; see New Jersey Bell Tel. Co. v. Board of Pub. Utility Comrs., 12 N. J. 568, 592, supra; cf. Southwestern Elec. Power Co. v. Federal Power Comm.,304 F. 2d 29 , 47, cert. den.371 U. S. 924 .)” (Matter of General Tel. Co. of Upstate N.Y. v Lundy at 379-380.)
Thus, it is clear that it is perfectly permissible for the PSC, in reviewing a tariff, to undertake an examination of component expenses to ascertain if such expenses are fair and reasonable. If they are not found to be fair and reasonable, the PSC must disregard them in formulating the approved tariff.
Apart from the foregoing, in at least one instance, involving a tariff fixed by contract between a utility and a state agency, it was held that the PSC possessed the requisite authority to disregard the contract between the utility and state agency and direct that the contractual rate be increased. In New York Tel. Co. v State of N.Y., Div. of State Police (
In addition, the court cannot ignore the comment made by the Court of Appeals in its recent decision in this case:
“While the PSC concluded that it did not have jurisdiction over DOCS, it could have determined that MCI’s call rate and surcharge as a whole were ‘unjust, unreasonable or unjustly discriminatory or unduly preferential or in anywise in violation of law’ (Public Service Law § 97 [1]) and ordered them to be lowered. It was reasonable for petitioners to believe that the PSC could have rejected MCI’s rate*783 and surcharges in their entirety, just as, in 1998, it had approved them in their entirety.” (Walton v New York State Dept. of Correctional Servs.,8 NY3d 186 , 196 [2007], supra.)
From the foregoing, it is evident that the Court of Appeals believed that the PSC possessed the requisite authority to review the proposed call rates, including the DOCS commission.
Thus, in the court’s view, the proposed rates filed by MCI, which included the DOCS commission, were tariffs subject to review in their entirety by the PSC, which possessed full authority to review the reasonableness thereof as a whole, as it had done in the past. The fact that the Public Service Commission determined to bifurcate the proposed rate, and then declined to review the DOCS portion thereof (while simultaneously directing that the unapproved portion be included in the filed amended tariff) did not operate to transmute the tariff into a tax.
With regard to the petitioners’ argument that the PSC had effectively disapproved the DOCS commission (by finding it to be “nonjurisdictional”), it is the court’s view that the PSC’s failure to fulfill its statutory responsibilities under the Public Service Law did not operate to transform the DOCS commission into a tax. To the extent that it might be argued that the DOCS commission was thereby deemed to be unlawful (since it was not expressly approved by the PSC), collection of the unapproved portion of the tariff could have rendered MCI subject to the enforcement provisions of Public Service Law § 96.
Inasmuch as the Public Service Commission possessed full authority to review the proposed rates to be paid to MCI, it is clear that that portion of the tariff attributable to the commission paid by MCI to DOCS is not a tax, and does not violate NY Constitution, article III, § 1 or article XVI, § 1. Under such circumstances, the court finds (notwithstanding the determination rendered by the PSC), that there is no true controversy, and count II of the petition fails to state a cause of action.
Violation of Due Process Rights (Count III)
The petitioners argue that the single provider/collect call only system unlawfully burdens their due process rights under NY
The court initially observes that the petitioners have made clear that they are not pursuing a procedural due process claim. With regard to substantive due process, as stated in Samuels v New York State Dept. of Health (
“New York’s Due Process Clause provides that ‘[n]o person shall be deprived of life, liberty or property without due process of law’ (NY Const, art I, § 6). Protection for certain fundamental rights is implicit within this crucial constitutional clause (see Hope v Perales, [83 NY2d 563 ], supra at 575 [1994]). And, in an appropriate case, the protections provided by New York’s Due Process Clause will be afforded a more expansive interpretation than the US Constitution (see Sharrock v Dell Buick-Cadillac,45 NY2d 152 , 159-160 [1978]; see also People v LaValle,3 NY3d 88 , 129 [2004]; Cooper v Morin,49 NY2d 69 , 79 [1979]). A law that impinges upon a fundamental right is subject to strict scrutiny, whereas one that does not ‘burden a fundamental right ... is valid if it bears a rational relationship to [a governmental] interest’ (Hope v Perales, supra at 577).” (Samuels v New York State Dept. of Health at 13.)
The court further notes that at least two courts have found, in situations very similar to the one at bar, that the plaintiffs in those cases failed to raise a substantive due process claim (see McGuire v Ameritech Servs., Inc.,
Violation of the Equal Protection Clause (Count IV)
Count IV alleges a violation of petitioners’ rights to equal protection under NY Constitution, article I, § ll.
With respect to the Federal Constitution, it has been held that the Equal Protection Clause insures that all persons who are similarly situated will be treated alike (see Cleburne v Cleburne Living Center, Inc.,
Several courts which have dealt with the equal protection issue in cases similar to the one at bar have found that the practice of utilizing a single-provider collect call telephone system which charges a higher rate than rates paid by the general public does not constitute an improper classification for purposes of invoking the Equal Protection Clause (see McGuire v Ameritech Servs., Inc.,
Violation of Free Speech and Association Rights (Count V)
Count V alleges a violation of petitioners’ rights to free speech and association under NY Constitution, article I, § 8.
“ ‘[P]rison walls do not form a barrier separating prison inmates from the protections of the Constitution,’ Turner v. Safley,482 U. S., at 84 , nor do they bar free citizens from exercising their own constitutional rights by reaching out to those on the ‘inside,’ id., at 94-99; Bell v. Wolfish,441 U. S. 520 (1979); Jones v. North Carolina Prisoners’ Labor Union, Inc., 433 U. S. (1977); Pell v. Procunier,417 U. S. 817 (1974). We have recognized, however, that these rights must be exercised with due regard for the ‘inordinately difficult undertaking’ that is modern prison administration. Turner v. Safley,482 U. S., at 85 .” (Thornburgh v Abbott,490 US 401 , 407 [1989]; see also Overton v Bazzetta,539 US 126 [2003].)
Significantly, a number of courts have found that an inmate does not have a right to unlimited telephone access (see Perez v Federal Bur. of Prisons,
In Valdez v Rosenbaum (
Notes
. For purposes of the instant discussion, the court will refer to all MCI entities, past and present, including respondent MCI Worldcom Communications, Inc., simply as “MCI.”
. Summaries of their comments are included in the PSC’s order issued on October 30, 2003.
. Before embarking on a discussion of the instant motion, the court hastens to point out that, effective April 1, 2008, it will be unlawful for the Department of Correctional Services to accept or receive revenue in excess of its reasonable operating cost for establishing and administering its inmate telephone system (see Correction Law § 623, as added by L 2007, ch 240, § 2; see also Byrd v Goord,
. “The legislative power of this state shall be vested in the senate and assembly.”
. “The power of taxation shall never be surrendered, suspended or contracted away, except as to securities issued for public purposes pursuant to law. Any laws which delegate the taxing power shall specify the types of taxes which may be imposed thereunder and provide for their review.”
. The court is equally mindful of respondent’s argument that the PSC had effectively granted de facto approval of the so-called bifurcated rate, through the inclusion of the DOCS commission in the tariff amendments which were filed at its direction, and with its approval.
. “No person shall be deprived of life, liberty or property without due process of law.”
. “Every citizen may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of that right; and no law shall be passed to restrain or abridge the liberty of speech or of the press.”
. The court in McGuire v Ameritech Servs., Inc. {supra) pointed out that substantive due process claims arising out of the First Amendment but brought separately under the Due Process Clause lack merit (id., citing Albright v Oliver,
. “No person shall be denied the equal protection of the laws of this state or any subdivision thereof.”
. “Every citizen may freely speak, write and publish his or her sentiments on all subjects, being responsible for the abuse of that right; and no law shall be passed to restrain or abridge the liberty of speech or of the press.”
. As noted in Curie v Ward (
. See also United States v Footman (
