Congress Begins FPI Debate

November 6, 2003
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The U.S. House this morning began debate on legislation to reform Federal Prison Industries, the agency that critics complain unfairly competes with the private sector through a virtual monopoly over federal contracts.

A vote on the bill, sponsored by U.S. Rep. Pete Hoekstra, R-Holland, is expected late this afternoon or this evening. Passage would send the bill on for consideration in the Senate.

The bill would open all federal contracts to competitive bidding by removing, over a five-year period, a provision known as mandatory source status that requires federal agencies to buy prisoner-made products when available.

Backers of the bill, including a unique bipartisan coalition that includes labor and business interests, say that reforms are necessary to control FPI’s monopoly over federal contracts and incursions into the private sector, and that the measure provides alternative job training and work programs for federal inmates.

I understand and support the need to provide prisoners with meaningful work that can help the rehabilitation process. But, it should not be done in a procedurally flawed manner, and FPI should not unfairly compete with private-sector bidders,” U.S. Rep. Vern Ehlers, R-Grand Rapids, said during debate this morning on the House floor.

Ehlers cited the furor this past spring over a $6 million contract Steelcase Inc. won to refurnish the FAA headquarters in Washington, D.C. FPI took away the contract after reviewing and then matching the company’s bid dollar for dollar.

The uproar over the incident led FPI to subsequently relinquish the contract to Steelcase.

FPI is an arm of the U.S. Justice Department’s Federal Bureau of Prisons that employs more than 21,700 inmates to produce some 80 products, including textiles, electronic and automotive components, and office furniture, sold under the “Unicor” brand name.

Last year, as the office furniture industry’s sales continued to plunge, FPI’s furniture business grew 24 percent to $217.8 million.

Rep. Carolyn Maloney, D-New York, criticized FPI’s “predatory practices” and for being a “government-sponsored monopoly” that unfairly competes with the private sector.

“The federal government should not be taking action to put American men and women out of work,” Maloney said.

Opponents to the bill argue that it goes too far in seeking to solve problems with FPI and will cause steep reductions in prisoner employment, leading to higher recidivism rates and safety and security problems in prisons. Praising the work experience FPI provides prisoners, which helps lower recidivism rates, they urged lawmakers to examine other reforms that wouldn’t cripple the agency.

“I am the first to concede there are problems with FPI that should be fixed,” said Rep. Bobby Scott, D-Virginia.

“We should fix these problems, but we should do so in a way that assures the viability of the vital crime-reducing program,” Scott said. “This program reduces crime. We can do better than just gut the entire program with a meat-ax approach. We can improve the program without ending it.”

Backers counter that the bill provides the kind of vocational education federal prisoners need to gain employment after they’re released. They argue that the bill still allows FPI to compete for federal contracts and evens the playing field for businesses seeking federal business.

“It meets both goals — fair competition and rehabilitation,” said Rep. Denise Majette, D-Georgia.

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