Letter to the House Judiciary Committee Federal Prison Industry (FPI) Competition in Contracting Act (HR 1829)

July 23, 2003

The Honorable James Sensenbrenner
Chairman House Judiciary Committee
2138 Rayburn House Office Building
Washington, DC 20515

Dear Chairman Sensenbrenner:

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-Conyers Federal Prison Industries (FPI) Competition in Contracting Act (H.R. 1829) during consideration by the House Judiciary Committee. This bipartisan legislation is actively supported by a broad-based coalition including members of the business community, the family of labor, and the federal managers. We urge you to oppose any amendments that would circumvent real reform, or would allow FPI authority to sell further 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 market on over 300 products and services that generated $679 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, faster, and for a lower price.

This legislation would require FPI to be a more responsible supplier to Federal agencies and U.S. taxpayers. It would also 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. Since this reform was enacted, FPI's sales have continued to increase, dispelling the myth that the inmate work program cannot survive without preferential status in the federal procurement process. The time is now for Congress to free all federal agencies from FPI's unfair monopoly.

During Committee consideration, amendments are likely to be offered that would attempt to weaken and stall real reform efforts. Amendments that would merely suspend FPI's preferential status, and allow FPI to sell prison made-goods and services into the commercial marketplace are a step in the wrong direction. Likewise, any amendments that would allow FPI to sell goods currently produced in foreign markets, commonly known as repatriation, will have disastrous effects as well. The U.S. Chamber appreciates the intended mission of FPI to rehabilitate prisoners and reduce recidivism, but we do not agree it should be achieved at the expense of the American taxpayer, or the 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 unfair and monopolistic practices. Please support the fundamental reform established in the H.R. 1829, the Hoekstra-Frank-Collins-Maloney-Sensenbrenner-Conyers Competition in Contracting Act, during committee consideration.

Sincerely,

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