Prompted by Verizon's recent increase in early termination fees for some users, Senator Amy Klobuchar (D-MN) has, along with three colleagues, introduced a bill in the Senate to specifically address "budget-busting" early termination fees. The bill would limit ETFs to no more than the subsidy offered on a particular handset, and require that the fee be prorated equally every month until the end of a service contract (typically two years).

This isn't the first time Klobuchar has tried to address ETFs. Her Cell Phone Empowerment Act of 2007 mandated prorated early termination fees, as well as the elimination of other hidden fees. The bill would have required carriers to provide the FCC with data on dropped call rates and coverage gaps, and would have given consumers a minimum 30-day notice to cancel a contract extension. In addition, the bill required that consumers be provided with detailed coverage maps so they could determine whether they would have coverage at home or work.

Unfortunately, that bill has since languished in committee, though AT&T announced shortly after the bill was introduced in 2007 that it would voluntarily offer pro-rated ETFs. Eventually the rest of the industry followed suit, addressing at least one of the main concerns of the bill.

However, Verizon recently announced that users that buy an "advanced device"—in other words, a smartphone—would have their early termination fee arbitrarily doubled to $350, and the fee would only be reduced by $10 every month. Such an arrangement nets Verizon $230 if a contract is cancelled after 12 months; it would still net Verizon $120 if the contract were cancelled after 23 months.

Klobuchar blasted the move, calling it "anti-consumer and anti-competitive." She then called on the FCC to review the decision. "Verizon Wireless' decision shows us once again that the wireless industry cannot police itself and will not, on its own, make its practices more competitive and consumer-friendly," she wrote in a letter to the FCC Last month.

Though the Cell Phone Empowerment Act would certainly address many consumer issues with wireless carrier practices, Klobuchar, along with Senators Russ Feingold (D-WI), Jim Webb (D-VA), and Mark Begich (D-AK), has introduced the Cell Phone Early Termination Fee, Transparency and Fairness Act to specifically address ETFs. In addition to limiting ETFs to a maximum of a handset's subsidy, it would require carriers to prorate the ETF by an equal amount each month based on the length of the contract. So, if you cancel your contract halfway through the contract period, you'll only pay one-half of the ETF. Furthermore, carriers will be required to provide "clear and conspicuous disclosure" at the time of purchase, and require carriers to disclose the current ETF on users' monthly bills.

"Changing your wireless provider shouldn’t break the bank," Klobuchar said in a statement. "Forcing consumers to pay outrageous fees bearing little to no relation to the cost of their handset devices is anti-consumer and anti-competitive."