{ "id": "RL32380", "type": "CRS Report", "typeId": "REPORTS", "number": "RL32380", "active": false, "source": "EveryCRSReport.com, University of North Texas Libraries Government Documents Department", "versions": [ { "source": "EveryCRSReport.com", "id": 588631, "date": "2016-05-11", "retrieved": "2020-02-21T23:30:37.437297", "title": "Federal Prison Industries: Background, Debate, Legislative History, and Policy Options", "summary": "The Federal Prison Industries, Inc. (FPI), is a government-owned corporation that employs offenders incarcerated in correctional facilities under the Federal Bureau of Prisons (BOP). The FPI manufactures products and provides services that are sold to executive agencies in the federal government. The FPI was created to serve as a means for managing, training, and rehabilitating inmates in the federal prison system through employment in one of its industries.\nThe FPI is intended to be economically self-sustaining and it does not receive funding through congressional appropriations. In FY2015, the FPI generated $472 million in sales, which is greater than the FPI\u2019s sales in FY1993 ($405 million), but is below the FPI\u2019s peak sales of $885 million in FY2009. The FPI operated at an $18 million loss for FY2015, the seventh straight fiscal year in which the FPI\u2019s expenses exceeded revenues.\nData show that the number of FPI work assignments available to inmates has not kept pace with the growing federal inmate population. Starting in FY1988 the proportion of the federal inmate population employed by the FPI steadily deceased. In FY2015, approximately 7% of all federal inmates had an FPI work assignment.\nThe FPI manufactures products and provides services that are primarily sold to executive agencies in the federal government. In the past, federal departments and agencies were required to purchase products from the FPI. This requirement is sometimes referred to as the FPI\u2019s \u201cmandatory source clause.\u201d \nThe debate about the FPI centers on the FPI\u2019s mandatory source clause. Some policymakers believe the mandatory source clause impedes private vendors\u2019 abilities to secure federal contracts. However, the FPI contends that the mandatory source clause is necessary to overcome some of the inefficiencies written into its authorizing legislation and problems associated with producing products in a prison environment, thereby allowing it to generate revenue and provide work opportunities for inmates.\nCritics argue that the FPI\u2019s lower labor costs provide it with a competitive advantage over private sector employers. The FPI asserts that any lower labor costs are more than offset by the disadvantages associated with operating a business inside a prison.\nAdvocates of the FPI maintain it is a proven rehabilitative program that does not cost taxpayers anything to operate and it helps provide for the orderly operation of a prison by keeping inmates occupied. Critics contend that vocational education programs have been shown to be more effective at reducing recidivism and inmates who participate in them are not competing with private sector workers for federal contracts.\nCongress has taken legislative action to lessen any adverse impact the FPI has had on small businesses. For example, in 2002, 2003, and 2004, Congress passed legislation that modified how the Department of Defense (DOD) and the Central Intelligence Agency (CIA) procured products offered by the FPI in its schedule of products. In 2004, Congress passed legislation prohibiting federal agencies from using appropriated funding for FY2004 to purchase products or services offered by the FPI unless the agency determined that the products or services are provided at the best value. This provision was extended permanently in FY2005. In the 110th Congress, the National Defense Authorization Act for Fiscal Year 2008 (P.L. 110-181) modified the way in which DOD procures products from the FPI. In addition, the Administration of President George W. Bush made several efforts to reduce the consequences the FPI\u2019s mandatory source clause might have on the ability of private businesses to compete for federal contracts. \nShould Congress decide that it wants to try to reverse past trends and expand work opportunities for inmates, there are several options policymakers could consider. One option could be to expand a work-sharing initiative that the FPI has already started on a small scale. Congress could also consider replacing inmate work opportunities with vocational education programs. However, the BOP asserts that vocational and apprenticeship programs are not a substitution for, but rather a complement to, FPI work assignments. Congress might also consider allowing private businesses to compete for inmate labor on the open market. Congress has granted the FPI the authority to participate in the Prison Industry Enhancement Certification Program (PIECP), which allows inmate labor to be used to produce goods for sale on the open market if certain conditions are met, such as paying inmates the prevailing wage for similar work. However, the FPI has had problems taking advantage of this new authority because the FPI would be required to pay inmates higher wages, thus increasing overhead costs. Also, inmates tend to be lower-skilled than non-incarcerated workers, which means that the prevailing wage requirement, and the additional costs associated with operating a business in a correctional environment, makes inmate labor less attractive to private businesses. This problem could be resolved by removing the prevailing wage requirement and allowing the market to set the price for inmate labor, but this raises questions about what effect inmate labor might have on non-incarcerated workers and the potential for inmate laborers to be exploited.", "type": "CRS Report", "typeId": "REPORTS", "active": false, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "https://www.crs.gov/Reports/RL32380", "sha1": "9c0738a9afc95d866fed1d8dad9803ce6186450e", "filename": "files/20160511_RL32380_9c0738a9afc95d866fed1d8dad9803ce6186450e.html", "images": { "/products/Getimages/?directory=RL/html/RL32380_files&id=/1.png": "files/20160511_RL32380_images_dc14c33a7ef327e3fabf68b0cbc942bafbdf1980.png", "/products/Getimages/?directory=RL/html/RL32380_files&id=/0.png": "files/20160511_RL32380_images_b976bafd7f79c3dbae075d75216ccb6b0d0b66c5.png" } }, { "format": "PDF", "encoding": null, "url": "https://www.crs.gov/Reports/pdf/RL32380", "sha1": "249b0d01f84f4797a4816566af29c8703ab50632", "filename": "files/20160511_RL32380_249b0d01f84f4797a4816566af29c8703ab50632.pdf", "images": {} } ], "topics": [ { "source": "IBCList", "id": 4832, "name": "Small Business" }, { "source": "IBCList", "id": 4887, "name": "Corrections" } ] }, { "source": "EveryCRSReport.com", "id": 432273, "date": "2014-06-25", "retrieved": "2016-04-06T20:18:39.920734", "title": "Federal Prison Industries: Background, Debate, Legislative History, and Policy Options", "summary": "The Federal Prison Industries, Inc. (FPI), is a government-owned corporation that employs offenders incarcerated in correctional facilities under the Federal Bureau of Prisons (BOP). The FPI manufactures products and provides services that are sold to executive agencies in the federal government. The FPI was created to serve as a means for managing, training, and rehabilitating inmates in the federal prison system through employment in one of its industries.\nThe FPI is economically self-sustaining and it does not receive funding through congressional appropriations. In FY2013, the FPI generated $533 million in sales, which is greater than the FPI\u2019s sales in FY1993 ($405 million), but it is below the FPI\u2019s peak sales of $885 million in FY2009. The FPI operated at a $4 million loss for FY2012, the fifth straight fiscal year in which the FPI expenses exceeded revenues.\nData show that the number of FPI work assignments available to inmates has not kept pace with the growing federal inmate population. Starting in FY1988 the proportion of the federal inmate population employed by the FPI steadily deceased. In FY2013, approximately 7% of all federal inmates had an FPI work assignment.\nThe FPI manufactures products and provides services that are primarily sold to executive agencies in the federal government. In the past, federal departments and agencies were required to purchase products from the FPI. This requirement is sometimes referred to as the FPI\u2019s \u201cmandatory source clause.\u201d \nThe debate about the FPI centers on the FPI\u2019s mandatory source clause. Some policy makers believe the mandatory source clause impedes private vendors\u2019 abilities to secure federal contracts. However, the FPI contends that the mandatory source clause is necessary to overcome some of the inefficiencies written into its authorizing legislation and problems associated with producing products in a prison environment, thereby allowing it to generate revenue and provide work opportunities for inmates.\nCritics argue that the FPI\u2019s lower labor costs provide it with a competitive advantage over private sector employers. The FPI asserts that any lower labor costs are more than offset by the disadvantages associated with operating a business inside a prison.\nAdvocates of the FPI maintain it is a proven rehabilitative program that does not cost taxpayers anything to operate and it helps provide for the orderly operation of a prison by keeping inmates occupied. Critics contend that vocational education programs have been shown to be more effective at reducing recidivism and inmates who participate in them are not competing with private sector workers for federal contracts.\nCongress has taken legislative action to lessen any adverse impact the FPI has had on small businesses. For example, in 2002, 2003, and 2004, Congress passed legislation that modified how the Department of Defense (DOD) and the Central Intelligence Agency (CIA) procured products offered by the FPI in its schedule of products. In 2004, Congress passed legislation prohibiting federal agencies from using appropriated funding for FY2004 to purchase products or services offered by the FPI unless the agency determined that the products or services are provided at the best value. This provision was extended permanently in FY2005. In the 110th Congress, the National Defense Authorization Act for Fiscal Year 2008 (P.L. 110-181) modified the way in which DOD procures products from the FPI. In addition, the Administration of President George W. Bush made several efforts to reduce the consequences the FPI\u2019s mandatory source clause might have on the ability of private businesses to compete for federal contracts. \nShould Congress decide that it wants to try to reverse past trends and expand work opportunities for inmates, there are several options policy makers could consider. One option could be to expand a work sharing initiative that the FPI has already started on a small scale. Congress could also consider replacing inmate work opportunities with vocational education programs. However, the BOP asserts that vocational and apprenticeship programs are not a substitution for, but rather a complement to, FPI work assignments. Congress might also consider allowing private businesses to compete for inmate labor on the open market. Congress has granted the FPI the authority to participate in the Prison Industry Enhancement Certification Program (PIECP), which allows inmate labor to be used to produce goods for sale on the open market if certain conditions are met, such as paying inmates the prevailing wage for similar work. However, the FPI has had problems taking advantage of this new authority because the FPI would be required to pay inmates higher wages, thus increasing overhead costs. Also, inmates tend to be lower-skilled than non-incarcerated workers, which means that the prevailing wage requirement, and the additional costs associated with operating a business in a correctional environment, makes inmate labor less attractive to private businesses. This problem could be resolved by removing the prevailing wage requirement and allowing the market to set the price for inmate labor, but this raises questions about what effect inmate labor might have on non-incarcerated workers and the potential for inmate laborers to be exploited.", "type": "CRS Report", "typeId": "REPORTS", "active": true, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/RL32380", "sha1": "f90afcb71af05510a69bee863e8b0509a312dae1", "filename": "files/20140625_RL32380_f90afcb71af05510a69bee863e8b0509a312dae1.html", "images": null }, { "format": "PDF", "encoding": null, "url": "http://www.crs.gov/Reports/pdf/RL32380", "sha1": "fd6a4532e7a800008c7ae40a2af27513a1c947b3", "filename": "files/20140625_RL32380_fd6a4532e7a800008c7ae40a2af27513a1c947b3.pdf", "images": null } ], "topics": [ { "source": "IBCList", "id": 2636, "name": "Small Business Policy" } ] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc462396/", "id": "RL32380_2013Jan09", "date": "2013-01-09", "retrieved": "2014-12-05T09:57:41", "title": "Federal Prison Industries: Overview and Legislative History", "summary": "This report provides background on the Federal Prison Industries, Inc.'s (FPI's) operations and statutory authority; it does not address the related debates on inmate labor, criminal rehabilitation, or competitive versus noncompetitive federal government contracting.", "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20130109_RL32380_2ffbd0ed0a4be4fb7e9b6619bc3a617ee9dd2da9.pdf" }, { "format": "HTML", "filename": "files/20130109_RL32380_2ffbd0ed0a4be4fb7e9b6619bc3a617ee9dd2da9.html" } ], "topics": [ { "source": "LIV", "id": "Criminal justice", "name": "Criminal justice" }, { "source": "LIV", "id": "Prisons", "name": "Prisons" }, { "source": "LIV", "id": "Government corporations", "name": "Government corporations" } ] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc807508/", "id": "RL32380_2011Jan04", "date": "2011-01-04", "retrieved": "2016-03-19T13:57:26", "title": "Federal Prison Industries", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20110104_RL32380_81d2dea2eca9e09e3a968c9d3cbcf3a127c4b9a6.pdf" }, { "format": "HTML", "filename": "files/20110104_RL32380_81d2dea2eca9e09e3a968c9d3cbcf3a127c4b9a6.html" } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc820033/", "id": "RL32380_2009Jan13", "date": "2009-01-13", "retrieved": "2016-03-19T13:57:26", "title": "Federal Prison Industries", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20090113_RL32380_94d7222816b32399c8bb0205343599aecae33313.pdf" }, { "format": "HTML", "filename": "files/20090113_RL32380_94d7222816b32399c8bb0205343599aecae33313.html" } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc809102/", "id": "RL32380_2007Jul13", "date": "2007-07-13", "retrieved": "2016-03-19T13:57:26", "title": "Federal Prison Industries", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20070713_RL32380_9e2fd6ce630f9eed89529148fbf88c6ebd624dad.pdf" }, { "format": "HTML", "filename": "files/20070713_RL32380_9e2fd6ce630f9eed89529148fbf88c6ebd624dad.html" } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc817928/", "id": "RL32380_2006Mar23", "date": "2006-03-23", "retrieved": "2016-03-19T13:57:26", "title": "Federal Prison Industries", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20060323_RL32380_3b04e1627c1be77d9a7e7ca1b8a14cd54989a24a.pdf" }, { "format": "HTML", "filename": "files/20060323_RL32380_3b04e1627c1be77d9a7e7ca1b8a14cd54989a24a.html" } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc816034/", "id": "RL32380_2004Jun15", "date": "2004-06-15", "retrieved": "2016-03-19T13:57:26", "title": "Federal Prison Industries", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20040615_RL32380_6bb8cb91621875f9a1abaa200b22af4b10dda04d.pdf" }, { "format": "HTML", "filename": "files/20040615_RL32380_6bb8cb91621875f9a1abaa200b22af4b10dda04d.html" } ], "topics": [] } ], "topics": [ "Appropriations", "Crime Policy", "Economic Policy", "Intelligence and National Security", "National Defense" ] }