Chairman Hoekstra, Ranking Minority Member Mink and Members of the Committee,

I appreciate the opportunity to submit testimony to discuss Federal Prison Industries (FPI), sometimes known as UNICOR, and the impact of this Federally mandated program on the business community.

My district contains both the federal prison at Oxford, Wisconsin, and an important manufacturing company that supplies materials and services to FPI. Krueger International (KI) has approximately 2,000 employees in its manufacturing facilities in Green Bay, Gillett and Manitowoc, Wisconsin and Tupelo and Winona, Mississippi. The largest, single customer of KI is FPI.

Private sector businesses, like KI, vigorously compete for FPI's business. Many of them are small or minority-owned businesses which supply materials and services either to companies like KI or directly to FPI. If FPI's ability to do business were affected, as its administrators believe it would be by legislation such as H.R. 2758, all the businesses, large and small, that have invested years of effort developing business with FPI would be affected as well.

I would like to submit for the record the "White Paper" prepared by Federal Prison Industries in March 1996 entitled "Addressing The Effect of Federal Prison Industries on The Private Sector in General and The Furniture Industry Specifically". The paper indicates that 100% of every dollar of FPI sales is returned to private sector businesses. Vendors large and small benefit from FPI's procurement from them of equipment, services and raw materials. Local businesses and communities also gain through monies spent by correctional staff and inmates, and through FPI contracting with local vendors. The paper suggests that legislation which would "take away FPI's status as a mandatory source of federal supplies and require it to compete commercially for federal agencies' business" would have the consequence of a net loss of private sector jobs. I urge you and your staff to consider carefully the attached paper and its findings concerning private sector jobs in order to assess the overall impact of H.R. 2758.

In addition, the security of our prisons would be significantly impacted by H.R. 2758. The Bureau of Prisons considers FPI to be its single, most critical correctional tool in managing the spiraling inmate population and overcrowding that now exceeds federal prison capacity by 24%. As our federal prison population continues to increase, the need for inmates to work has simultaneously become more crucial. By providing essential training and employment, FPI reduces the inmate idleness associated with prison disruption, thereby making the institutions and surrounding communities more safe and secure. Further, a 1991 Post Employment Release Study has shown that the inmate worker is less likely to recidivate upon release than the non-employed inmate, which ultimately results in a cost savings to the American taxpayer. In these tough budgetary times we do not need to burden the taxpayer with the expense of our prisons erupting due to inmate idleness and boredom, or with the costs associated with increased rates of recidivism.

Finally, we must consider those men and women whose jobs and safety are at risk by this proposed legislation. They are the thousands of federal employees who may spend their entire day in direct contact with inmates who we have decided are too dangerous for our streets and neighborhoods. They are the men and women who daily supervise the work of thousands of inmates who otherwise would be idle. They are the men and women who know that the dangerous consequences of inmate idleness and boredom in severely overcrowded conditions would be destruction of prison property, and worse, serious injury and death to inmates and themselves. These people are our employees. We are the trustees of their lives and we have an obligation to them and their families not to put them in any greater jeopardy than is absolutely essential to maintaining our prisons. The destruction of the FPI program, which the proposed legislation would do, places these employees in added jeopardy.

For the reasons stated above, Mr. Chairman and Members, I urge you to continue to support Federal Prison Industries in its current form.