HR 2558 IH

To amend title 18, United States Code, to reform Federal Prison Industries, and for other purposes.

Mr. MCCOLLUM (for himself and Mr. SCOTT) introduced the following bill; which was referred to the Committee on the Judiciary

To amend title 18, United States Code, to reform Federal Prison Industries, and for other purposes.

• Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

• This Act may be cited as the `Prison Industries Reform Act of 1999'.

SEC. 2. GENERAL PROVISIONS RELATING TO THE STRUCTURE AND MISSION OF FEDERAL PRISON INDUSTRIES.

• Sections 4121 through 4122 of title 18, United States Code, are amended to read as follows:

`Sec. 4121. Industrial operations in Federal prisons

• `The Attorney General shall determine in what manner and to what extent industrial operations shall be carried on in Federal correctional institutions. Such operations shall be conducted so as (1) to provide employment for the greatest number of those inmates in the United States correctional institutions who are eligible to work as is reasonably possible, (2) generate sufficient revenues to fund the industrial operations, (3) generate revenue, to be returned to the Treasury of the United States, to defray a portion of the cost of confining inmates in United States correctional institutions, and (4) minimize any adverse impact on domestic companies or workers to the greatest extent possible consistent with its mission.

`Sec. 4122. Federal Prison Industries

• `(a) Federal Prison Industries is a government corporation of the District of Columbia, and shall carry on such industrial operations in Federal correctional institutions as shall be determined by the Attorney General in accordance with section 4121. The corporation shall be governed by a board of 12 directors appointed by the Attorney General. In making appointments to the Board, the Attorney General shall appoint to the Board one person recommended by each of the Speaker of the House of Representatives, the minority leader of the House of Representatives, the majority leader of the Senate, and the minority leader of the Senate. The members of the Board shall serve for 4 years and may be reappointed. The members of the Board shall serve without compensation. The Director of the Bureau of Prisons shall serve as Chief Executive Officer of the Corporation.

• `(b) Federal Prison Industries shall endeavor, consistent with the priorities established in section 4121, to produce products that otherwise would be produced by foreign workers outside the United States. Federal Prisons Industries shall also endeavor, consistent with those priorities, to enter into contracts pursuant to section 4131 with private companies that employ foreign workers outside the United States to produce products, for the purpose of inducing such companies to employ inmates in a Federal Prison Industry Shop to produce such products.

• `(c) The Attorney General shall appoint an Independent Review Panel composed of one representative from each of the Department of Commerce, the Department of Labor, the International Trade Commission, the Small Business Administration, the business community, and organized labor, and such other persons as the Attorney General deems appropriate. The Panel shall advise the Board regarding the type and quantity of products to be produced by Federal Prison Industries for sale in interstate commerce consistent with the purposes set forth in subsection (a). The members of the Panel shall serve without compensation. The Federal Advisory Committee Act shall not apply with respect to the Panel.'.

SEC. 3. ELIMINATION OF MANDATORY SOURCE PREFERENCE AND CREATION OF FAIR COMPETITION AUTHORITY.

• Chapter 307 of title 18, United States Code, is amended by adding at the end the following:

`Sec. 4130. Federal Prison Industry inmate labor

• `The Attorney General shall endeavor to make available to inmates who have been committed to the custody of the Bureau of Prisons opportunities to work in a Federal Prison Industry Shop. The Attorney General may set standards regarding education and conduct for those inmates who work in a Federal Prison Industry Shop.

`Sec. 4131. Sale of products; contracts for the provision of labor; inmate wages

• `(a) Federal Prison Industries is authorized to sell its products generally on the open market to the public,

to departments and agencies of the United States, to a State or municipality, and to foreign governments.

• `(b) Federal Prison Industries is authorized, and shall make it a priority, to enter into contracts with one or more private companies through which such private company may produce products at a Federal Prison Industry Shop for sale. In addition to any other provision negotiated by the private company and Federal Prison Industries, any such contract shall provide--

• `(1) for the amount to paid to Federal Prison Industries by the private company;

• `(2) that if the private company employs any non inmate workers, on or after a date that is 60 days prior to the execution of the contract, who reside within the United States, that the private company agrees to continue to employ non-inmate workers who reside within the United States in at least the same number for a period of at least 18 months after the date of the contract or the date the private company begins to produce products at a Federal Prison Industry Shop, whichever is later; and

• `(3) that the Attorney General shall make available to such private company under reasonable terms and conditions such number of inmates who have been selected to work in a prison industry carried on by Federal Prison Industries as shall be specified in the contract.

• `(c) Federal Prison Industries shall pay wages to all inmates who work in a prison industry carried on by Federal Prison Industries (including those at which products are produced by a private company pursuant to a contract with Federal Prison Industries) at a rate not less than the Federal minimum wage from time to time in effect. From the amounts paid to inmates pursuant to this section, the Attorney General is authorized to deduct amounts, not exceeding in their aggregate 90 percent, for--

• `(1) payment of fines, special assessments, and restitution owed by the prisoner pursuant to court order;

• `(2) allocations for support of the inmate's family pursuant to statute, court order, or agreement by the inmate;

• `(3) reasonable charges for room and board, as determined by the Attorney General, but not less than 50 percent of the total amounts deducted under this subsection;

• `(4) amounts to be held on account and paid to the inmate upon release from the custody of the Bureau of Prisons; and

• `(5) contributions to any fund established by law to compensate the victims of crime.

• `(d) Federal Prison Industries shall be relieved from payment of the amount specified in subsection (c) if the Independent Review Panel determines that the products are--

• `(1) foreign-made products; or

• `(2) any product described in section 1761(b).

• Inmates producing such products shall, instead of the amount specified in subsection (c), be paid wages not less than would be paid at the rate set forth in the schedule of compensation paid to inmates working at prison industries carried on by Federal Prison Industries on the date of enactment of the Prison Industries Reform Act of 1999. From the wages paid to such inmates under this subsection, the Attorney General is authorized to deduct amounts, not exceeding in their aggregate 50 percent of the amount paid to an inmate, for the purposes set forth in subsection (c).

• `(e) An inmate may agree to deductions in additional to those provided for in subsections (c) and (d) if the additional deductions are used solely for the purposes described in paragraphs (2) and (4) of subsection (c).

• `(f) Nothing in this section shall be construed to prohibit more than one Federal Prison Industry Shop from being located at a Federal correctional facility. A Federal Prison Industry Shop may be located outside a correctional facility if all of the inmates working at that Shop are classified as minimum security inmates.

• `(g) After consultation with the Independent Review Panel, the Attorney General may waive the requirement of subsection (b)(2) if the Attorney General determines that exigent circumstances exist and the private company has taken all reasonable steps to continue to employ its non-inmate workers who reside within the United States.

`Sec. 4132. Elimination of mandatory source purchase requirement

• `(a) Not later than 180 days after the date of enactment of the Prison Industries Reform Act of 1999, the Attorney General shall submit to Congress a plan for the elimination of the use by Federal Prison Industries of the mandatory source preference requirement described in section 4124. Such plan shall provide for annual reductions in that portion of the total sales of Federal Prison Industries made pursuant to that requirement, and shall further provide that no sales shall be made pursuant to that requirement after the date which is 7 years after the date of enactment of such Act. The plan shall also provide that Federal Prison Industries shall designate those products, described by Standard Industrial Product Code (as published by the Office of Management and Budget) as to which it has determined to no longer sell to Federal departments and agencies under the authority described in section 4124 of this chapter. Within 30 days of such designation, Federal Prison Industries shall publish in the Federal Register and in a commercial business publication with a national circulation a list of those products so designated. Federal Prison Industries shall make available to the public, on request, a list of all such products so designated. The plan shall take effect 180 days after its submission to Congress, unless Congress by law provides otherwise.

• `(b) Federal Prison Industries shall not undertake the production of any new product or significantly expand the rate of production of a product for sale to any Federal department, agency, or institution, unless the procurement requirement for that product described in section 4124 has been eliminated in accordance with the plan described in subsection (a).

• `(c) Federal agencies may purchase directly from Federal Prison Industries those products for which the procurement requirement has been eliminated in accordance with the plan described in subsection (a) in such quantities and by such method they deem appropriate.

`Sec. 4133. Procurement from the private sector

• `For purchases from the private sector in support of its operations, Federal Prison Industries shall be exempt from the provisions of the Competition in Contracting Act and the Federal Acquisition Regulation. Nothing in this section shall be construed to modify any requirement that any department, agency, or other institution of the Federal Government comply with the provisions of the Competition in Contracting Act and the Federal Acquisition Regulation.

`Sec. 4134. Applicability of other law

• `Nothing in this chapter shall be construed to entitle an inmate to employment in a Federal Prison Industry Shop, to any wage, compensation, or benefit, to imply that inmates are employees for the purposes of other laws or programs, or to provide a cause of action by or on behalf of any person against the United States or any officer, employee, or contractor thereof.

`Sec. 4135. Definitions

• `In this chapter--

• `(1) the term `private company' means a corporation, partnership, joint venture, or sole proprietorship;

• `(2) the term `product' includes both goods and services;

• `(3) the term `Federal Prison Industry Shop' means a prison industry operation at which a product is made or provided;

• `(4) the term `foreign-made product' means a product that would otherwise be produced by foreign workers outside the United States.'.

SEC. 4. REVIVAL OF OLD LAW UPON FAILURE OF CONDITIONS.

• (a) IN GENERAL-

• (1) DETERMINATION- On the date that is--

• (A) 3 years after the date of the enactment of this Act; and

• (B) 5 years after the date of the enactment of this Act;

• the Attorney General shall determine what percentage of the total eligible inmates are employed by Federal Prison Industries.

• (2) NOTICE TO CONGRESS- If the Attorney General determines under paragraph (1) that less than 25 percent of the total number of eligible inmates are employed by the Federal Prison Industries, the Attorney General may, not later than 180 days after that determination, provide notice of that determination to Congress.

• (3) EFFECT OF NOTICE- If the Attorney General provides notice to Congress under paragraph (2) the amendments made by this Act shall cease to have any further effect 60 days after that notice is so provided.

• (b) DEFINITION- As used in this section, the term `eligible inmate' means a person--

• (1) committed to the custody of the Bureau of Prisons pursuant to section 3621 of this title;

• (2) designated to a low, medium, or high security facility operated by the Bureau of Prisons; and

• (3) who is physically and mentally able to work.

SEC. 5. STATE PRISON INDUSTRY SALES AUTHORITY.

• Section 1761 of title 18, United States Code, is amended by adding at the end the following:

• `(e)(1) In addition to the exceptions set forth in subsections (b) and (c), this chapter does not apply to goods, wares, or merchandise manufactured, produced, or mined by convicts or prisoners if--

• `(A)(i) in connection with that manufacture, production, or mining, such convicts or prisoners receive wages at a rate equal to the Federal minimum wage from time to time in effect; or

• `(ii) such goods, wares, or merchandise, would otherwise be produced by foreign workers outside the United States; and

• `(B) on or before any such sales commence, the State adopts a plan to eliminate, not later than 7 years after the date on which such sales commence, any requirement that departments or agencies of that State purchase the goods, merchandise, or wares manufactured, produced, or mined by convicts or prisoners incarcerated in that State.

• `(2) Nothing in this subsection shall prohibit a State or municipality deducting from any wages paid under this subsection amounts for--

• `(A) payment of fines and restitution owed by the prisoner pursuant to court order;

• `(B) reasonable charges for room and board;

• `(C) allocations for support of the inmate's family pursuant to statute, court order, or agreement by the inmate;

• `(D) contributions to be held on account and paid out to the inmate upon release; and

• `(E) contributions to any fund established by law to compensate the victims of crime.'.

SEC. 6. CONFORMING AMENDMENTS.

• (a) SECTION 1761- Section 1761 of title 18, United States Code, is amended by adding at the end the following:

• `(f) This section does not apply to sales of products made pursuant to section 4131.'.

• (b) SECTION 1762- Title 18, United States Code, is amended by striking section 1762.

• (c) SECTION 4123- Title 18, United States Code, is amended by striking section 4123.

• (d) CLERICAL AMENDMENTS-

• (1) CHAPTER 307- The table of sections at the beginning of chapter 307 of title 18, United States Code, is amended--

• (A) so that the items relating to sections 4121 through 4122 read as follows:

• `4121. Industrial operations in Federal prisons.

• `4122. Federal Prison Industries.';

• (B) by striking the item relating to section 4123; and

• (C) by adding at the end the following new items:

• `4130. Federal Prison Industry inmate labor.

• `4131. Sale of products; contracts for the provision of labor; inmate wages.

• `4132. Elimination of mandatory source purchase requirement.

• `4133. Procurement from the private sector.

• `4134. Applicability of other law.

• `4135. Definitions.'.

• (2) CHAPTER 85- The table of sections at the beginning of chapter 85 of title 18, United States Code, is amended by striking the item relating to section 1762.

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