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Prison Industries could face competition for federal business

The House Judiciary Committee voted Wednesday to end the long-standing monopoly for federal prisons selling products to the federal government.

The bipartisan legislation, H.R. 1577, would allow private companies to compete with Federal Prison Industries (FPI), whose trade name is Unicor. FPI is a division of the Bureau of Prisons that employs about 20,000 federal inmates to produce $500 million in furniture, clothing, electronics and other products for federal agencies. Federal rules require agencies to purchase certain Unicor items.

The measure--a substitute offered by Rep. James Sensenbrenner, R-Wis., the committee chairman, and Rep. Barney Frank, D-Mass.--passed the committee on a voice vote.

The committee had started voting on amendments April 18 but did not complete the bill. During committee action Wednesday, the panel accepted by voice votes non-controversial technical and clarifying amendments, by Reps. Mark Green, R-Wis., Mel Watt, D-N.C., and Jerrold Nadler, D-N.Y. The committee defeated an amendment by Rep. Darrell Issa, R-Calif.,that would have required federal prisons to be the sole federal supplier if 80 percent of the inmate workforce was within two years of release from prison. Sensenbrenner said the amendment would create an "administrative nightmare."

An amendment by Rep. Bobby Scott, D-Va., to permit specific products, such as bags made for the Postal Service, continue to be made for federal agencies beyond a 20 percent market share was defeated on a voice vote.

The prison industries program has had priority in supplying government goods since 1934. Federal agencies are required to purchase items made in the federal prison system if they are available, regardless of price or timeliness of delivery.

Last year, Congress inserted a provision in the Department of Defense authorization bill requiring FPI to compete with private industry for Defense contracts, Sensenbrenner said at last Thursday's subcommittee session.

The Defense Department has not yet enacted the provision. Once it does, Defense contracting officers still must determine if FPI offers the "best available" product in terms of quality, price and timeliness. If an FPI product is deemed the best available, Defense would be required to buy it from the agency. If FPI's product is not the best, the agency would have to compete with private firms in order to win a contract with the Pentagon.

Sensenbrenner said the provision could be seen as "a victory for labor, business, industry, and the American taxpayer."