For Immediate Release      	Contact: Sari Greenberg
June 25, 1998				202-225-5901

Washington, D.C. -- U.S. Representative Mac Collins (R-Hampton) welcomed today's hearing by the House Crime Subcommittee on legislation he cosponsored to end the unfair advantage that prison industries currently enjoy in the Federal procurement process.

Supported by a number of small business and labor organizations, the "Federal Prison Industries Competition in Contracting Act" (HR 2758) eliminates a 1934 statute requiring Federal agencies to buy products manufactured by the Federal Prison Industries or FPI. FPI employs over 17,000 inmates at Federal correctional facilities across the country. Currently, Federal agencies are required to purchase prison-made goods, even if the private sector makes a better product at a lower price.

"This is unfair to the businesses and law-abiding workers who make these products. It is unfair to the taxpayer who must bear the additional procurement costs to the government. I believe that Congress must act immediately to require FPI to compete with private sector business for its Federal contracts," Collins stated.

According to the Third District Congressman, "The legislation, of which I am an original cosponsor, protects the jobs of workers whose only `crime' is being employed by a business that is not allowed to compete with FPI."

Collins explained that the bill "requires FPI to compete for its sales, protects the jobs of law-abiding workers, and frees federal contracting officers to protect the mission needs of their agencies and the taxpayers' dollars."

At the hearing, Members also considered the "Free Market Prison Industries Reform Act" (H.R. 4100), which would expand the FPI by moving private sector businesses and jobs inside prison walls. Collins sharply criticized this legislation, supported by Subcommittee Chairman Bill McCollum, as a step in the wrong direction. This bill would require Federal agencies to purchase FPI services in addition to its products, and would allow FPI to enter into commercial markets. It also removes the few provisions of current law that protect America's small businesses from the predatory tactics that FPI has employed in the past to capture contracts.

Collins concluded, "As the representative of a district that has lost a business and over 150 jobs to FPI's unfair competition, I know first hand the damage that FPI exacts on the private sector. It is time we put the interests of the American taxpayer over the interests of Federal convicts."

The bill has been endorsed by the U.S. Chamber of Commerce, the National Federation of Independent Businesses, the Small Business Legislative Council, the National Association of Manufacturers, the National Defense Industrial Association, the Associated General Contractors of America, and the AFL-CIO.

Current Cospnsors of H.R. 2758: Frank, Collins, Maloney (NY), Hilleary, Schumer, Coble, Clay, Bartlett, Hamilton, Deal, Torres, Manzullo, DeFazio, Stump, Ehlers, Oxley, Hefley, Taylor (NC), Ewing, Upton, Everett, English, Chambliss, Linder, Nethercutt, Crane, Riggs, Hostettler, Emerson, Bilbray, Burr, Knollenberg, Ballenger, Calvert, Barcia, Stabenow, Baker, Goode, Kennedy (RI), Gilman, King, Latham, Berry, McHugh, Royce, Rahall, Weldon (PA), Frost, Woolsey, Sandlin, John, Coburn, Tiahrt, Cunningham, Filner, Lucas, Ney, Klug, Gutknecht, Camp.

FEDERAL PRISON INDUSTRIES COMPETITION IN CONTRACTING ACT OF 1997

Dear Colleague:

We invite you to be a cosponsor of the Hoekstra-Frank-Collins-Maloney "FEDERAL PRISON INDUSTRIES COMPETITION IN CONTRACTING Acr OF 1997" and answer the call of many in the business community and organized labor, listed on the back.

Federal Prison Industries (FPI) is big and growing: FPI operates a chain of almost 100 factories, employing over 17,000 inmates at Federal correctional facilities around the country. With sales of $489 million during 1996, it was the 3 gth largest Government contractor, just behind Texas Instruments. If won competitively, FPI's growth would be the envy of the business community: $29 million in 1960, $117 million in 1980, $240 million in 1985, $339 million in 1990, and $459 million in 1995. FPI, however, gets its Govenunent contracts without competition.

Under FPI's 1934 statute, Federal agencies are required to buy products offered by FPI. A Federal agency must actually obtain FPI's permission to purchase competitively from the private sector, even if a commercially available item better meets the agency's mission needs, can be delivered more quickly, and costs less.

But FPI's unfair advantages don't stop here: FPI can dictate the price to be paid for its products. FPI, rather than its Federal agency "customers", determines whether FPI's products and delivery schedule meets the agency's needs. If any dispute arises between FPI and one of its agency "customers", FPI decides whose position prevails, under the threat of an unworkable appeal process unused since the 1930s!

Our legislation, H.R. 2758, addresses all of these abusive FPI preferences:

H.R. 2758 requires FPI to compete for its sales. To protect the safety of prison guards, our bill provides authority for the Attorney General to authorize, on a contract-by-contract basis, non-competitive contract awards to FPI, if needed to prevent a prison disturbance.

H.R. 2758 makes FPI less predatory of law-abiding workers. It better protects the jobs of workers whose only "crime" is being employed by a firm that happens to find itself in the path of another FPI expansion. The benefits of work-based inmate rehabilitation programs do not require the sale of any resulting products, especially in the corrosive manner permitted today.

H.R. 2758 unshackles contracting officers to protect the mission needs of their agencies and the taxpayers' dollars. FPI would now have to fully perform its obligations, on time, and be paid no more than a fair market price. Today's system permits FPI to abuse its agency "customers" to sustain the myth of being "self-supporting". We cannot demand that Federal agencies do more with less and not make the changes proposed by H.R. 2758.

If you would like to join the 60 bipartisan cosponsors (see below) of H.R. 2758, please contact us. Your staff may contact Chris Lagrand of Mr. Hoekstra's staff (5-4401), Robert Raben of Mr. Frank's staff (5-6900), Christopher Ptomey of Mr. Collins' staff (5-5901), or Gail Ravnitzky of Mrs. Maloney's staff (5-7944).

Peter Hoekstra
Mac Collins
Barney Frank
Carolyn Maloney

Joined by Organized Labor:

AFL-CIO, its Public Employee Department, its Building and Construction Trades Department, and a number of its affiliated unions, including UNITE! (Union of Needletrades, Industrial, and Textile Employees) and the United Food and Commercial Workers Internation Union (UFCW).