Chamber Commends House Action on Prison Industries Monopoly

WASHINGTON, D.C. – The United States Chamber of Commerce applauded House action that provides businesses the opportunity to compete for government contracts and phases-out the unfair "mandatory source" status the government-run Federal Prison Industries holds as a government supplier.

"It's an appalling fact that businesses employing hardworking, law-abiding Americans cannot compete for government contracts that are being paid for with their tax dollars," said Bruce Josten, Chamber executive vice president. "Today's vote to open the federal marketplace is a major victory for business, particularly small businesses, and for taxpayers who expect the government to purchase quality goods and services at the lowest price possible."

H.R. 1829, the Federal Prison Industries Competition in Contracting Act, eliminates the requirement that government agencies purchase products from only FPI and allows the private sector to compete fairly with FPI for federal contracts. The bill also clarifies that the prohibition that prevents FPI from selling products in the commercial marketplace also applies to services as well. Additionally, it provides a five-year transition period for the government to phase-out FPI's "mandatory source" supplier status and provides modern, "hands-on" vocational and remedial educational opportunities to prepare inmates for jobs when they leave prison.

"As our economy continues to rebound, we must ensure that no employers or employees are shut-out from opportunities with the federal government," Josten added. "FPI employs more than 21,700 inmates with sales approaching $700 million. That's a lot of opportunities for businesses if they are given a fair chance to compete."

The Chamber has long advocated a level playing field in the federal procurement process and is a leader in the Competition in Contracting Act Coalition, a group of more than 300 business and labor organizations actively seeking legislative and regulatory relief from FPI's monopolistic practices.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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