Comments on "Waiver Processing Instructions and Information" Procedures

January 23, 2004

Ms. Jan Hynson
Ombudsman
Federal Prison Industries, Inc.
400 First Street, NW, 8th Floor
Washington, DC 20534

The U.S. Chamber of Commerce appreciates the opportunity to comment on the proposed "Waiver Processing Instructions and Information" procedures. The U.S. Chamber is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region. These comments are offered on behalf of U.S. Chamber members, small and large, that rely on an efficient, fair competitive process in providing the federal government with goods and services to sustain and grow their businesses.

While the Chamber strongly supports comprehensive reform legislation, many steps can be taken to provide tangible interim relief for the business community, which is currently adversely impacted by FPI's preferential status in the federal market. The Chamber commends the Federal Prison Industries (FPI) Board of Directors for seeking public comments in its attempt to advance this administrative action that was endorsed by the Bush Administration. Clear, effective implementation of this Board-adopted resolution is essential.

The most notable element of the proposed "Waiver Processing Instructions and Information" is the attempt to issue implementing procedures for the resolution relating to price-based waivers adopted by the Board on March 10, 2003. Directing FPI to grant price-based waivers allows Federal managers to more readily use competition to obtain "best-value" for the taxpayer dollars being expended through the Federal buying process. The key to effective implementation of this resolution is to empower the buying agency. Unfortunately, the proposed procedures effectively empower FPI, rather than the buying agency, to make the determination of whether FPI's offered product best meets the mission needs of the buying agency. FPI, or more specifically FPI's Ombudsman, will decide whether FPI's offered product is "comparable." We strongly urge that this language be redrafted to reflect the true intent of the resolution, which is to empower the buying agency with ultimate decision-making authority.

The proposed procedures also seek to impose upon the Federal buying agencies a requirement to enunciate "minimum, mission critical standards" in order to obtain a waiver based on determination by the buying agency that FPI's offered product does not represent the best value for the taxpayer dollars being expended. The procedures seek to supplant a "best value" standard with a minimum acceptable standard. Even if the agency does make the effort sto enunciate the required standards and finds that the FPI-offered product fails to meet them, that decision is subject to review and reversal by FPI's Ombudsman. Again, we strongly urge that the language be redrafted to reflect that the buying agency has ultimate authority.

Industry, government and the American taxpayer benefit from fair competition based on price, quality, and performance. On behalf of the U.S. Chamber, we urge our comments be taken into consideration in final implementation of the proposed "Waiver Processing Instructions and Information" procedures.

Sincerely,

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