Letter to the House Judiciary Committee on Federal Prison Industries Reform

April 15, 2002

To Members of the United States House Judiciary Committee:

The U.S. Chamber of Commerce, the world's largest business federation representing more than three million businesses and organizations of every size, sector and region, urges you to support the Hoekstra-Frank-Collins-Maloney-Sensenbrenner Federal Prison Industries (FPI) Competition in Contracting Act (HR 1577) during consideration by the House Judiciary Committee and oppose any amendments that would circumvent real reform or allow FPI authority to sell prison made products or services in the commercial marketplace.

Under current law, FPI has a preferential status in the government procurement process that forces federal agencies to buy only from FPI rather than using a competitive purchasing process. Once a small program focused solely on rehabilitation, FPI is now a large enterprise that has a monopoly in the federal marketplace on over 300 products and services that generated nearly $600 million in sales last year. Without reform, FPI will continue its unfettered expansion in the federal and commercial marketplace even though the private sector has proven it can better address the needs of government agencies and taxpayers by providing higher quality products, in a timelier manner, and for a lower price.

The bipartisan Competition in Contracting Act would require FPI to be a more responsible supplier to Federal agencies and the taxpayer, and would allow the private sector to compete fairly with FPI for federal contracts by eliminating the requirement that government agencies purchase products from FPI. The legislation provides a transition period for FPI as it adapts to the loss of its preferential status as well as provides for additional vocational and educational opportunities for inmates. A smaller reform measure was recently enacted that will allow the Defense Department, rather than FPI, to choose the best possible supplier to meet its needs. The time is now for Congress to allow all federal agencies the same opportunity and to provide additional fundamental reform as established in HR 1577, which is supported by the business, labor and the federal managers communities.

During Committee consideration, amendments are likely to be offered that would stall real reform efforts, such as merely suspending FPIs preferential status, and allow FPI to sell prison made goods and services into the commercial marketplace or allow them to sell goods currently produced in foreign markets, commonly known as repatriation. We appreciate the intended mission of FPI to rehabilitate prisoners and reduce recidivism, but we do not agree it should be met at the expense of the American taxpayer, hard-working, law-abiding businesses in the private sector and the workers they employ.

Accordingly, we urge you to oppose any amendments that would allow FPI to expand their monopolistic practices and support the fundamental reform established in the Hoekstra-Frank-Collins-Maloney-Sensenbrenner Competition in Contracting Act during committee consideration.

Sincerely,

R. Bruce Josten
Executive Vice President, Government Affairs
U.S. Chamber of Commerce