When the Prison Policy Initiative first published its landmark “Following the Money of Mass Incarceration” analysis, the number that stopped people cold was $27.7 billion. Not the cost of running prisons. Not the government’s corrections budget. The amount that families of incarcerated people spend out of their own pockets every year — just to stay connected, send basic supplies, and navigate a system designed to charge them for every interaction.
But knowing the total is not enough. To understand how incarceration functions as an engine of poverty, you have to follow the money — trace every dollar from a grandmother’s Social Security check to the corporate balance sheet where it lands. The 2026 update to that research makes the trail clearer than ever, and the picture is uglier than most Americans realize.
The Revenue Map: Where $27.7 Billion Actually Goes
The money families spend does not disappear into a single bucket. It fragments across a network of private companies, government agencies, and financial intermediaries — each taking their cut before a single ramen noodle reaches a commissary shelf or a single minute of phone time connects a mother to her son.
The breakdown, drawing on Prison Policy Initiative data and independent analyses updated through early 2026, looks roughly like this:
- Commissary spending: $7.6 billion annually. This covers food, hygiene products, clothing, and over-the-counter medications — items that corrections facilities are often legally obligated to provide but frequently do not supply in adequate quantity or quality.
- Phone and video calls: $2.9 billion. Despite FCC rate caps that took effect in 2024 and 2025, families still pay vastly inflated rates for voice and video communication.
- Money transfer fees: $1.1 billion. Getting funds into an incarcerated person’s account requires going through licensed money transfer providers who charge per-transaction fees ranging from $3.49 to $11.95.
- Bail and pretrial costs: $9.4 billion. This includes cash bail, bail bond premiums (typically 10 percent of the bail amount, nonrefundable), electronic monitoring fees, and pretrial supervision costs.
- Transportation and visit costs: $3.8 billion. Gas, lodging, meals, lost wages, and childcare during visits.
- Legal costs: $2.9 billion. Attorney fees, court costs, fines, and restitution payments that continue long after sentencing.
Every one of those categories generates profit for someone who is not incarcerated and did not commit a crime. And in most cases, the people paying are among the poorest Americans alive.
The FCC Phone Rate Caps: Progress With an Asterisk
The Federal Communications Commission deserves credit for finally acting on prison phone costs after decades of advocacy. The Martha Wright-Reed Just and Reasonable Communications Act, signed in January 2023, gave the FCC clear authority to cap rates, and the agency moved to implement interim rate caps in 2024, with permanent rules rolling out through 2025 and into 2026.
Under the current framework, interstate calls from prisons are capped at $0.06 per minute, and jail calls at $0.07 to $0.09 per minute depending on facility size. That represents a dramatic reduction from the era when a 15-minute call from a county jail could cost $14 or more.
But the asterisk is significant. The caps cover per-minute rates, not the full ecosystem of fees that surround every transaction. Ancillary charges — account maintenance fees, paper billing fees, single-call fees for those without prepaid accounts — continue to inflate the real cost. In practice, families report that their actual per-minute cost, once fees are folded in, can run two to three times the capped rate.
Video visitation remains particularly problematic. In hundreds of jails and prisons, in-person visits have been reduced or eliminated entirely, replaced by video terminals that charge $0.20 to $0.50 per minute. A 30-minute video visit can still cost a family $15 — and the quality is often abysmal, with frozen screens, dropped connections, and audio so garbled that lip-reading becomes the primary communication method.
Meanwhile, the telecom companies that dominate the prison communications market — Securus Technologies and ViaPath (formerly Global Tel*Link/GTL), which together control roughly 80 percent of the market — have adapted to the rate caps by restructuring their contracts. Site commissions, the kickbacks that facilities receive from telecom providers in exchange for exclusive contracts, have declined in some states but remain embedded in the business model. Multiple county jails still receive 40 to 70 percent of phone revenue as commission, creating a direct financial incentive to maintain high call volumes and resist further reform.
Commissary: Where Markup Is the Business Model
If you want to understand how incarceration extracts wealth from families, commissary is the clearest window. The markups are not subtle. They are the point.
Examples from 2025 and early 2026 commissary price lists — verified through public records requests and family advocacy organizations — tell the story:
- A 3-ounce packet of instant ramen: $1.05 (retail: $0.25 — a 320 percent markup)
- A 4-ounce stick of deodorant: $6.49 (retail: $2.49)
- A tube of toothpaste: $5.79 (retail: $1.99)
- A bag of ground coffee: $9.15 (retail: $3.99)
- A bar of soap: $2.89 (retail: $0.99)
- A single envelope: $0.75 (retail: less than $0.10)
These are not luxury items. They are soap, food, and the means to send a letter. And the people buying them — overwhelmingly, the families sending money from outside — have a median household income of roughly $40,000 before incarceration and significantly less after, according to research from the Ella Baker Center for Human Rights.
The commissary vendors operate on exclusive contracts, just like the phone companies. Two corporations — Keefe Group (owned by H.I.G. Capital) and Trinity Services Group (owned by Aramark) — dominate the market. They negotiate contracts with state departments of correction and county sheriffs, often including revenue-sharing provisions that incentivize higher prices. The facilities take their cut. The vendors take theirs. The families have no choice but to pay.
The Money Transfer Toll Booth
Before a family member’s money even reaches the commissary, it gets taxed at the transfer stage. Depositing funds into an incarcerated person’s trust account — the internal account used for commissary purchases, phone time, and medical co-pays — requires using a licensed provider.
JPay, owned by Securus Technologies, is the dominant player, processing transactions at roughly 1,700 facilities. Their fee structure as of early 2026: depositing $20 costs $3.49 in fees. Depositing $100 costs $6.95. Depositing $200 costs $11.95. That is a fee rate of 6 to 17 percent — numbers that would trigger regulatory action in virtually any other consumer financial service.
And the fees compound. If a mother in Louisville sends $50 a week to her son in a state prison — a modest amount that covers perhaps a week of commissary basics — she pays roughly $25 per month in transfer fees alone. Over the course of a year, that is $300 in pure extraction, paid to a private company for the privilege of sending her own money to her own child.
The Poverty Spiral
The cruelest feature of incarceration’s financial extraction is its cyclical nature. The families paying these costs are, by virtually every measure, already economically vulnerable. Two-thirds of families with an incarcerated member report difficulty meeting basic needs — housing, food, utilities — as a direct result of incarceration-related costs, according to a survey by the Ella Baker Center.
The spiral works like this: A family member is arrested. Bail drains whatever savings exist — the average bail for a felony exceeds $10,000, and even the nonrefundable 10 percent bond premium represents a catastrophic expense for a family living paycheck to paycheck. While the case is pending, the household loses an income earner. Attorney fees accumulate. The remaining family members begin sending money for commissary, paying for phone calls, driving to visits.
Within months, debt accumulates. Credit cards max out. Rent falls behind. One in three families goes into debt specifically to pay for phone calls and visits, according to the Prison Policy Initiative. The financial damage does not end at release — it follows the family, and the returning individual, for years.
Children bear the heaviest long-term cost. An estimated 2.7 million children in the United States have a parent behind bars. Research consistently shows that parental incarceration is associated with household income drops of 22 percent or more, increased housing instability, and poorer educational outcomes. The $27.7 billion extracted from families is not just a transfer of wealth. It is a mechanism for perpetuating poverty across generations.
What Reformers Are Pushing For in 2026
Advocates have moved beyond asking for modest rate reductions. The reform agenda in 2026 targets the structural incentives that make extraction profitable:
- Ban site commissions entirely. Several states, including Connecticut, California, and Illinois, have already eliminated or sharply reduced the kickbacks that facilities receive from phone and commissary vendors. Federal legislation to ban the practice nationwide has been introduced but not yet advanced.
- Make phone calls free. California, Connecticut, Colorado, Minnesota, and San Francisco have made calls from state prisons and city jails free. New York City followed. The argument is straightforward: communication with family reduces recidivism, and the cost of providing free calls is a fraction of the cost of re-incarceration.
- Cap commissary markups. Some states have begun limiting how much vendors can charge above wholesale cost. Legislation introduced in multiple state legislatures in 2025 and 2026 would cap markups at 10 to 25 percent — still profitable for vendors, but not predatory.
- Eliminate money transfer fees. Connecticut has made deposits into incarcerated people’s accounts free. Advocates are pushing other states to follow, arguing that the fees are a regressive tax on poverty.
- End video-only visitation. The National Institute of Corrections and multiple advocacy groups have pushed for policies requiring facilities to maintain in-person visitation even when video options are available.
The Accountability Gap
What makes the $27.7 billion figure so politically durable — so resistant to reform — is that no single entity is responsible for it. The federal government sets some phone rate caps but has no authority over commissary pricing. State legislatures control prison policy but often defer to county sheriffs on jail contracts. County officials sign vendor contracts behind closed doors, with no public bidding and no transparency requirements.
The companies profiting from the system are largely private equity-owned and therefore exempt from the disclosure requirements that apply to publicly traded corporations. Securus Technologies is owned by Platinum Equity. Keefe Group is owned by H.I.G. Capital. These firms do not hold press conferences or publish annual reports. They extract, they profit, and they remain invisible to the public whose tax dollars and family budgets fund their returns.
Until that changes — until the full financial architecture of incarceration is visible and subject to democratic accountability — the $27.7 billion tax will continue to fall on the people who can least afford it, subsidizing a system that punishes families for the crime of refusing to abandon their loved ones.
Resources for Families
- Prison Policy Initiative — prisonpolicy.org/money.html — Full “Following the Money” report and data
- Worth Rises — worthrises.org — Tracks prison telecom and commissary contracts
- FCC Incarcerated People’s Communications — fcc.gov — File complaints about phone rates
- The Ella Baker Center for Human Rights — ellabakercenter.org — “Who Pays?” report on family financial impacts
