Where Your 911 Fees Actually Go: Funding, Fee Diversion, and the Push for Federal NG911 Dollars

There is a line item on almost every phone bill in America that most people never read.

 

It might say 911 surcharge, emergency communications fee, or E911 assessment. It is usually

less than a dollar. Multiply it across hundreds of millions of phone lines, wireless devices, and

voice over IP connections, and it becomes the financial foundation of the entire emergency

communications system in the United States.

 

For the people who run that system, understanding where those dollars come from, what they

are legally permitted to fund, and why they so often fall short of what modernization actually costs is not an academic exercise. It is the difference between a Next Generation 911 project

that gets funded and one that stalls in committee for another budget cycle.

 

2026 has been an unusually eventful year for 911 funding. A new federal cost study substantially lowered the estimated price of finishing the nationwide NG911 transition. Bipartisan legislation to create a federal grant program is moving in both chambers of Congress. And individual states are quietly rewriting their own funding formulas rather than waiting for Washington. 

 

Here is what 911 authorities and PSAP leaders should understand about all of it in this blog from NGA.

How 911 Is Actually Paid For

There is no single national 911 fee. Instead, there are roughly fifty different systems, each with its own rate structure, collection mechanism, and rules about permissible spending. The surcharge is typically imposed per line or per connection, collected by communications providers, and remitted to a state fund, a county fund, or some combination of both.

 

The variation is striking. South Dakota assesses two dollars per line per month. Oregon collects

one dollar and twenty five cents per line or per device capable of reaching 911, and applies it to

prepaid wireless at the point of retail transaction. Tennessee's Emergency Communications Board ratified a statewide rate of one dollar and eighty six cents. Connecticut uses a tiered

schedule where a single line pays sixty nine cents while an account with more than a hundred

lines pays roughly fourteen cents per line. Minnesota's statute caps the fee at ninety five cents.

Colorado's state level surcharge sits in the range of twelve to sixteen cents per line, with local

authorities layering their own charges on top.

 

Two structural problems follow from this patchwork.

 

The first is erosion. Many surcharge rates were set years or decades ago and are not indexed to inflation. A fee that adequately funded call handling equipment in 2010 does not fund an IP

based network, cybersecurity monitoring, and geographic information system maintenance in

2026. Delaware's own legislative record noted that its sixty cent surcharge had remained

unchanged for many years while the cost of the system it supports kept climbing.

 

The second is the shrinking base. Surcharges were designed around a world of one telephone line per household. Consumers have consolidated onto fewer connections and moved to service types that were not always contemplated by older statutes. Legislatures have spent much of the last decade retrofitting their definitions to cover wireless, prepaid, and voice over IP so that the base does not quietly shrink out from under the fund.

What the Money Buys, and What It Does Not

Most state statutes enumerate permitted uses fairly specifically. Delaware's recent legislation

offers a representative list: administration and operation of the statewide 911 system, PSAP

operations, equipment, software, telecommunications infrastructure, training, public education,

cybersecurity, language translation services, and contractual obligations.

 

That list is worth noticing, because it reflects how much the job has expanded. Cybersecurity

and language translation are not legacy 911 expenses. They are consequences of running IP

based emergency communications for a diverse population, and they now compete for the

same surcharge dollars that pay for headsets and console maintenance.

 

The scale of dedicated modernization spending is measurable. According to the FCC's

Seventeenth Annual Report to Congress on state collection and distribution of 911 fees,

released in February 2026, total reported NG911 expenditures across the country in 2024 came

to roughly $535.1 million. That is real money and real progress. It is also a fraction of what a

completed nationwide transition requires, which is precisely why the funding conversation has

intensified.

Fee Diversion: The Problem That Will Not Go Away

Fee diversion happens when a state or taxing jurisdiction collects money labeled as a 911 fee

and then spends some of it on something other than 911. Sometimes it is an explicit transfer to

a general fund during a budget shortfall. Sometimes it is a broader public safety purpose that

sounds adjacent but falls outside the statutory definition.

 

The FCC has reported to Congress on this annually for well over a decade, and every single one of those reports has identified at least some diversion. The Twelfth Annual Report found that five states diverted more than $200 million in 911 fees in a single year, amounting to about 6.6 percent of all fees collected nationwide. Advocates testifying before Congress have estimated that more than a billion dollars has been diverted cumulatively since 2009.

 

Congress responded by giving the practice real consequences. Federal law established an

interagency 911 Strike Force to study diversion and directed the FCC to adopt rules designating

permissible uses of 911 fees. Critically, states identified as diverters can lose access to federal

911 grant funding. West Virginia's own legislative audit documented exactly that outcome,

noting the state received none of the $109.25 million available under the federal 911 grant

program in 2019 because of its diversion status.

 

For PSAP directors, the lesson is uncomfortable but useful. Diversion is not only a moral or

political problem. It is a direct threat to your agency's eligibility for the outside money you may

be counting on. If you operate in a state with a diversion history, that history belongs in your

funding strategy conversations, and the annual FCC report is a legitimate, citable document to

bring to a county commission or a legislative committee.

The National Price Tag Just Got Smaller

For years the working figure for finishing NG911 nationwide came from a 2018 federal cost

study, which landed somewhere between roughly $9.5 billion and $12.7 billion. That number

anchored nearly every funding debate that followed.

 

At the end of April 2026, the National Telecommunications and Information Administration

released an updated cost study with a notably different answer. NTIA now estimates the

remaining cost to complete a nationwide NG911 transition at between $5.8 billion and $9.27

billion, a reduction of roughly 30 to 40 percent from the 2018 estimate.

 

The reasons behind the reduction matter as much as the figure. NTIA attributed the lower

projection to the substantial upfront work and investment states and localities have already

made, and to a broader market shift toward software based and subscription oriented delivery

models with generally lower upfront costs. In other words, the number came down partly

because agencies have been doing the work, and partly because the way NG911 capability is purchased has changed.

 

The National Emergency Number Association responded by reaffirming that nationwide

implementation still requires a sustained, multi-year commitment and urging Congress to act. A lower estimate is not a solved problem. It is a more achievable one, and it removes a talking

point from anyone who argued the cost was simply too large to contemplate.

The Federal Push in Congress

The vehicle currently carrying the federal funding hope is the Next Generation 9-1-1 Act. The

House version, H.R. 6505, was introduced in the 119th Congress and advanced out of the House Communications and Technology Subcommittee in January 2026. A bipartisan Senate

companion followed in March 2026, introduced by Senators Ted Budd, Amy Klobuchar, and

Catherine Cortez Masto.

 

Structurally, the bill would establish an NG911 grant program administered by NTIA. Notable features include the following.

 

• Broad eligible uses. Grant funds could support NG911 implementation activities,

cybersecurity measures, public outreach and education about NG911 capabilities, and,

within limits, training and administrative costs.

• Required coordination planning. Applicants would need to submit an NG911 coordination and implementation plan, which pushes states toward the statewide governance and planning work that successful transitions depend on anyway.
• Technical assistance from NTIA. The agency would advise applicants on preparing

implementation plans and support grant recipients, which matters enormously for smaller

agencies without dedicated grant staff.

• Tight administrative caps and a Tribal set-aside. Administrative costs are capped at a low single-digit percentage, with a dedicated share reserved for Tribal entities.

 

The unresolved question is the dollar amount. A version in a previous Congress carried a $15

billion figure. The refiled bill omits a specific number, and the funding mechanism itself remains

under negotiation. Key House members have publicly described bipartisan progress on the

concept while acknowledging that identifying an agreed funding source is the remaining hurdle,

with stopgap approaches floated in the interim.

 

The realistic read for 911 authorities: federal money is a genuine possibility rather than a

fantasy, but it is not a line you can budget against yet, and it will almost certainly arrive as

competitive or formula grants requiring a plan you have not written. 

States Are Not Waiting

While Congress works, states have been acting on their own, and Delaware provides a clean

case study of how a modernization funding package comes together.

 

House Bill 468, signed by Governor Matt Meyer on June 30, 2026, transitions the state from

legacy Enhanced 911 to NG911 and updates the funding structure to match. The monthly

surcharge rises from sixty cents to ninety cents effective October 1, 2026. Against roughly 1.25

million billable connections statewide, that moves annual collections from about $9 million

upward, with the fiscal note projecting roughly $3.4 million in additional revenue in fiscal year

2027 and about $4.5 million annually thereafter.

 

Several things about that package are instructive for other states. The rate increase was paired

with a statutory modernization of the system it funds, not passed in isolation. The surcharge was

applied across residential, business, wireless, and nontraditional communications services so the base is broad. And the permitted uses were updated to explicitly include cybersecurity and

language translation, acknowledging what modern 911 actually spends money on.

 

Movement runs in both directions. Illinois legislation adjusted its surcharge structure for its

largest municipality, reducing the maximum permitted rate effective January 2026. Funding

authority is not a one-way ratchet, and agencies should not assume today's rate is permanent in

either direction.

What 911 Authorities Should Do With This

Funding policy can feel like someone else's department. In practice, a handful of concrete

actions consistently separate agencies that get funded from agencies that wait.

 

• Know your own numbers cold. Your surcharge rate, when it was last changed, total annual collections, what share reaches your PSAP, and what your fund balance looks like. Legislators respond to specifics, not to general statements that funding is insufficient.
• Have a written NG911 implementation plan on the shelf. Both the federal grant structure and most state programs require one. Agencies with a current plan can move when a funding window opens. Agencies without one spend the window writing it.
• Quantify the cost of doing nothing. Legacy equipment maintenance, staffing overtime

driven by inefficient workflows, and outage exposure are all real costs. Framing

modernization as cost avoidance rather than new spending changes the conversation with a finance committee.

• Track your state's legislative session. Surcharge changes, permitted use expansions, and governance restructuring all happen at the state level, often quickly and with limited public attention. Your state 911 administrator association is the cheapest early warning system available.
• Favor funding models that match your revenue. The shift toward software based and

subscription delivery that NTIA credited for lower national costs also aligns better with a

recurring surcharge stream than a large periodic capital replacement does. That alignment is worth weighing during procurement.

Conclusion

The sub-dollar line item on a phone bill is doing an enormous amount of work. It funds the

people who answer when someone's worst day begins, and the networks that get those calls to

the right place. It was also largely designed for a system that no longer exists.

 

The encouraging news in 2026 is that the gap between what 911 costs and what 911 collects

looks narrower than it did a year ago. The national estimate came down. Federal legislation has

bipartisan momentum in both chambers. States are modernizing their funding structures

alongside their technology. And the shift toward software based delivery has lowered the

barrier for agencies that could never have funded a large capital project outright.

 

What has not changed is that funding follows planning. The agencies positioned to benefit are

the ones that already know what they need, what it costs, how it phases, and what questions to

ask a trusted NG911 provider about hosting, security, interoperability, and long-term

operating cost. If you are building that case now, that is the right time to be doing it.