H.Res. 997

Mr. Chairman, I rise in opposition to H.R. 2965, the Federal Prison Industries Competition in Contracting Act.

The Federal Prison Industries program was signed into law by President Roosevelt in 1934, in the midst of the Great Depression. This program was enacted as a way to protect the public by teaching prisoners real work habits and skills, so that when they are released, they will be better able to find and hold a job to support themselves and their families and be less likely to commit crimes in the future.

It is clear that the program has done just that. Follow-up studies covering as much as 16 years of data have shown that inmates who participate in Prison Industries are much more likely to be employed and much less likely to commit crimes than prisoners who do not participate in the program. While this certainly benefits offenders and their families, the real public policy benefit is that, as a result of this program, there are fewer victims of crime.

Contrary to the indication given by the proponents of this bill, the FPI program does not have a significant impact on business and labor. In its first year of operation, the percent of Federal contract procurement from FPI represented one-fourth of 1 percent of total annual Federal agency procurement dollars; and it is the same today, one-fourth of 1 percent, and this is just Federal procurement. It is obviously a minuscule portion of the total economy.

Critics, who were philosophically opposed to the program back in the 1930s and they are still opposed today, suggest that FPI has caused substantial losses in jobs for law-abiding citizens. The furniture and apparel industries are the two industries in which FPI has traditionally done most of its work. When asked under oath, representatives of these industries testified that the FPI sales represent an insignificant and negligible portion of their industries. At our last hearing, the office furniture industry representative was not able to point to any loss to his industry caused by FPI.

I am the first to concede that there may be problems with FPI that need improvement, and we have made improvements through activities in Congress and the FPI board over the last 10 years. While it is understandable that every company that does not get a contract that FPI gets may be disappointed, just as they would be disappointed if another company got the same contract, the public safety and institutional safety and management benefits of this program have an insignificant impact on business and labor, and it is a public policy success story.

All able inmates in the Federal system are required, by law, to work. Non-FPI inmate jobs pay about $0.12 to $0.30 an hour, while FPI jobs pay about $1 up to $1.15 per hour. There are currently enough FPI jobs for only 18 percent of the work-eligible population. The other 82 percent of the prisoners work in non-FPI-related maintenance jobs.

In 2000, FPI jobs represented 25 percent of the prison jobs. In recent years, however, because we have passed restrictions like there are in this bill, there are fewer jobs and that has caused the elimination of over 2,000 jobs at the same time that the prison population has increased by 23,000 inmates, and it is still increasing. This bill will shrink FPI jobs even more.

We need to promote, not reduce, Federal Prison Industries jobs because the FPI program strongly supports education. To hold down an FPI job, an inmate must have completed high school, or be making steady progress towards obtaining a GED, and maintain a good record of behavior. This is not only true for those who hold FPI jobs but also those who are on the waiting list for a job, as well as those seeking to establish eligibility to be placed on the waiting list; and once in an FPI job, an inmate cannot earn more than $0.40 an hour until he earns a GED. That is why FPI is not only a great job skills development and education development tool, but it is also a great management tool to help ensure prisons operate efficiently and safely for prison employees as well as inmates. I have never met a prison administrator who does not support this program.

Few offenders enter the program with marketable work skills. The vast majority do not even have basic work habits, such as showing up for work on time each day and working cooperatively and productively with others. Such work habits are required to maintain an FPI job. These are the same work habits required to be a good, productive, desirable worker anywhere, and that is why inmates who have FPI work experience have been found to be significantly more employable than those that do not.

I oppose this bill because it will obviously reduce job opportunities. The bill amends the current requirement in law for agencies to purchase goods from FPI and establishes a competitive bid process for agency purchases of goods and services from FPI, unless the Attorney General and the Bureau of Prisons certify that they cannot safely run the prisons without the particular contract award. It is unrealistic to expect that any official would publicly admit such a level of incompetence in order to obtain a contract, so it is unlikely that that provision will ever be used.

The bill claims to make an effort to replace mandatory source and service contracts by providing a transition preference program for agencies using FPI, by authorizing new options such as providing products or services to charitable and nonprofit organizations contingent on appropriations, by allowing FPI to provide services and products to Federal agencies on a noncompetitive basis if they would otherwise be provided from offshore, and by authorizing work training programs for FPI to produce goods and services for private companies if the goods and services are not produced anywhere in the United States.

However, there is no basis for concluding that these authorities would replace the loss of jobs now available and legally sanctioned, and it is unlikely to suspect that the appropriations would be made or that the job training programs will be sufficient because most of the job training programs are 2 years at most. Obviously, people with longer sentences cannot benefit from that.

So before we decimate what the Department of Justice defines as the most important rehabilitation program, without a reliable replacement for those jobs, I believe we should direct a comprehensive study of its impact on labor and business and its beneficial impact on public safety before we do anything else.

In the face of all the good that this program does, I do not believe that we should throw the baby out with the bath water. Mr. Chairman, I would hope that we would defeat the bill and we maintain these jobs.

Mr. Chairman, will the gentleman yield?

Mr. Chairman, I thank the gentleman for yielding.

I would tell my friend from Michigan that you would get my support if you just guaranteed that the jobs would be there. We need people working on these jobs. If they are working on jobs, there will be less crime. So anything that will guarantee the jobs I can support.

Mr. Chairman, I appreciate Mr. Conyers giving

me the opportunity to respond to my friend from North Carolina, who suggested that I was misguided by opposing the bill. Perhaps I am misguided, because the bill increases crime and I am trying to reduce crime.

We know that increasing jobs will reduce crime. This bill, we know, reduces jobs. The goal of FPI has been traditionally for 25 percent of the jobs to be FPI jobs. As a result of the initiatives in this bill, many of which were enacted in 2001, the percentage of jobs has gone from 25 to 18, 2,000 fewer jobs. And if we had maintained the 25 percent, there would be 9,000 more people working in FPI jobs, with a much lower chance of getting into trouble when they are released.

This reduction in jobs will increase crime. Maybe opposing an increase in crime is misguided, but I think we ought to reguide ourselves and support those initiatives, which will actually reduce crime, not increase crime, as this bill does.

Mr. Chairman, I thank the gentleman for yielding, because, as I indicated, as a result of the initiatives that are in this bill, we have already lost thousands of jobs. And if we had had the law as it was in 2000, we would have about 9,000 more people working.

The gentleman from Massachusetts has said there are other alternatives. If we were guaranteed funding for that, I would support it. The problem is that the FPI pays for itself, so it doesn't need appropriation. If we can guarantee the funding, there wouldn't be any debate on this. The job training also may not have funding. So we don't know that that is going to take place. So there is no guarantee.

The problem with this approach is that there is no guarantee for funding. The FPI program pays for itself, and has been paying for itself for over 70 years. It works well. We know it works, and the replacements are just speculative.

First of all, we will work together on the funding, no question about that. Furthermore, there is not a one-to-one replacement. You have about four people in prison working on what would otherwise be one job.

Mr. Chairman, I offer an amendment.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this amendment would also authorize the Justice Department to acquire products from the Federal Prison Industries on a noncompetitive basis as deemed appropriate by the Attorney General.

Along with the Bureau of Prisons, the Attorney General has the responsibility for the safe, productive operation of Federal prisons and should, therefore, have the authority to ensure that all operations under his control are available to be directed to this effort. And insofar as Federal Prison Industries program is concerned, we know it is an effective tool to help the prison operations.

This could be a much more realistic option for the Attorney General to ensure against disruption at a prison from the loss of jobs and contracts than the notion in the bill that he would have to declare the prison unmanageable without a particular contract. That is what is in the bill.

It is not the wholesale authority for the Attorney General to direct any agency to award all of its FPI contracts, but only as deemed necessary or appropriate by the Attorney General, and it only covers Justice Department agencies.

Remember, Mr. Chairman, we are trying to create jobs and manage the prisons. That is what this amendment would help the Attorney General do. I hope it would be the body's pleasure to adopt the amendment.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself the balance of my time.

I would close by saying this amendment would allow the Attorney General to make sure that there are enough jobs in the Federal Prison Industries to help manage the prisons. We know the more jobs there are, the less crime there will be in the future. That is the purpose of this amendment, managing the prisons and reducing crime.

I would hope we would adopt that goal by allowing prisons to be managed better and reducing crime by adopting the amendment.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I demand a recorded vote.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this amendment would allow the level of service contracts now being performed by FPI to continue at that level while prohibiting further expansion. There is no mandatory source provision for service contracts so they are already competitive. Most of the contracts involve work that would otherwise be done offshore, so FPI's competition is with foreign workers, not Americans.

There have been no complaints about service contracts. Service contracts constitute a significant portion of the inmate work opportunities now in the program. None of these authorities individually or combined in the bill will realistically produce sufficient work opportunities for inmates to replace the loss of jobs from the elimination of mandatory source and the loss of current service contract jobs.

Stable FPI jobs are critical to the efficient and safe operation of Federal prisons and the rehabilitation of inmates which correlates directly with public safety. There is no record to suggest that this part of FPI is broken beyond the philosophical view that it represents some kind of unfair competition to American businesses and workers; but in this case, there is virtually no competition. The reality is that this is not true, and no one has suggested that FPI service contracts today have any significant impact on American businesses or workers.

Let us at least continue the level of service contracts we have now in an effort to reduce crime in the future. We are trying to reduce crime, trying to help manage the prisons. This will be go a little way into preserving some of those opportunities.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself such time as I may consume, and just acknowledge this amendment is just designed to preserve a few of the jobs that we have got left. The amendments that passed in 2000 and 2001 have cost. If they had not passed, we would have 9,000 more jobs than we have now. We have already lost jobs. We would have had a lot more jobs than we had.

We are just trying to preserve job opportunities, which have been shown to reduce crime. Now, I know it has already been said that trying to reduce crime is misguided around here, but that is the goal of the bill, and everybody who has studied it knows that is what would happen. If you have more jobs, you will have less crime. That is all we are trying to do.

Mr. Chairman, I reserve the balance of my time.

Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 997 and ask for its immediate consideration.

Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to the gentleman from Florida (Mr. Hastings), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.

Mr. Speaker, this is a structured rule providing for consideration of H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2006. The rule provides 1 hour of general debate, equally divided and controlled by the chairman and the ranking minority member of the Committee on the Judiciary. It waives all points of order against consideration of the bill. It provides that the amendment in the nature of a substitute recommended by the Committee on the Judiciary which is now printed in the bill shall be considered as an original bill for the purpose of amendments and shall be considered as read.

The rule makes in order only those amendments printed in the Rules Committee report accompanying the resolution, and it provides that the amendments made in order may be offered only in the order printed in the report, may be offered only by a Member designated in the report, shall be considered as read, shall be debatable for the time specified in the report, equally divided and controlled by the proponent and an opponent, and shall not be subject to amendment, and shall not be subject to a demand for division of the question in the House or in the Committee of the Whole.

Finally, Mr. Speaker, the rule waives all points of order against the amendments printed in the report and allows one motion to recommit with or without instructions.

Mr. Speaker, today we will debate reforming a government-owned corporation called UNICOR, which is more commonly known as the Federal Prison Industries. Federal Prison Industries, Incorporated, manufactures products and provides services that are sold to the executive agencies in the Federal Government. When the Federal prison system was established at the turn of the 20th century, factories were erected in Federal prisons to manufacture products for the Federal Government. President Roosevelt consolidated Federal Prison Industries into UNICOR in 1934 to provide training opportunities for inmates, control inmate behavior, and diversify production.

In fiscal year 2005, Federal Prison Industries generated $765 million in sales with all revenue reinvested in the purchase of raw materials and wages for inmates and staff. As of 2004, there were 102 UNICOR factories at 71 different correctional facilities working on operations such as metals, furniture, electronics, textiles and graphic arts. UNICOR currently employs 19,720 inmates, or 17 percent of eligible Federal prisoners, at a rate of 23 cents to $1.15 an hour and, by charter, must be economically self-sustaining without any Federal appropriations.

So, Mr. Speaker, the problem with the current system is the adverse impact it has had on small businesses which do not have the ability to compete with UNICOR's guaranteed market, even if they could provide a better deal for our government agencies.

Mr. Hoekstra introduced H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2005, with the fundamental objective of correcting this problem by eliminating the requirement for Federal agencies to purchase products from UNICOR under most circumstances.

H.R. 1829, the Federal Prison Industries Competition in Contracting Act of 2003 passed by a vote of 350-65 in the 108th Congress, and it is almost identical to this Federal Prison Industries Competition in Contracting Act of 2005, the notable exception being the authorization of a new work-based employment preparation program for Federal inmates where private sector firms can enter into agreements with UNICOR to prepare inmates to reenter society through real-world work and apprenticeships.

The Federal Prison Industries Competition in Contracting Act would change the 1934 statute of Federal Prison Industries by requiring UNICOR to compete, let me repeat, to compete for business opportunities instead of relying on a mandatory government purchasing, prohibits inmate labor from being sold separate from inmate products, provides more remedial education and vocational training opportunities for inmates, authorizes alternative inmate work opportunities in support of nonprofit community service organizations, and it allows the Attorney General oversight and discretion to award individual source contracts should UNICOR lose a contract and endanger the safety of a Federal correctional institution.

It establishes a $2.50 per hour minimum wage for prisoners who are within 2 years of release. It raises the maximum wage to half of the Federal minimum wage for all inmates by September 30, 2008, and equal to the Federal minimum wage by 2013.

Finally, Mr. Speaker, it increases the ability for public comment on proposed Federal Prison Industries expansions and ensures direct access to these comments by the board of directors.

Considering our Nation's tradition on promoting fair competition and with the support of organizations and business interests such as the Associated Builders and Contractors, the Coalition for Government Procurement, the National Association of Manufacturers, the National Federation of Independent Business, the Uniform and Textile Service Association, the United States Chamber of Commerce, and the Prison and Justice Fellowship, it should be reasonable to apply good business practices to prison labor.

Beyond fair competition, it is important to modernize the Federal Prison Industries program for this 21st century. UNICOR has operated on the same base model since 1934, despite diverse changes in labor and technology.

Our Federal prisoners are beyond the days of simply stamping a license plate for a penny a day. If we are to remain committed to rehabilitation and our Federal system of prisons, then we need a serious commitment to give prisoners reasonable work skills, reinforce acceptable behavior, and reinstate these prisoners to a real world work environment.

Furthermore, we need a system that is business friendly and is cost effective to our Federal Government.

I urge my colleagues to vote for swift passage of this rule, and, of course, H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2006.

I, Mr. Speaker, stand in support for both the rule and the underlying legislation.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I don't question the gentleman from California's right to take an opportunity to advocate on behalf of his district and the construction of that Federal facility, and I am sure he knows of what he speaks. But getting more to the point of this particular bill, the gentleman, my good friend from Florida, wanted an open rule.

Of course, I understand that. I think if I were on the other side, I would always want an open rule as well. But in the spirit of openness, I want to point out to my colleagues, Mr. Speaker, that I think there were eight or nine amendments submitted. We accepted five. Three of those amendments to this bill were Democratic amendments, one was a bipartisan amendment. Yes, there was one Republican amendment.

The last time we passed this bill, there were something like, we had an open rule, and there were 14 amendments that were accepted. All of those amendments are included now in the text of this bill that we are discussing today.

I just want to point out that the process of bipartisanship and openness, Mr. Speaker, let me just tell you, and remind my colleague from Florida, and I know he is aware of this, but in the committee, the ranking member, Mr. Conyers, supported this bill as did Mr. Watt, Mrs. Maloney, Ms. Waters, and Mr. Frank. The main amendment that came through committee concerned this issue of training, of better training of our current Federal prison population to help them be better rehabilitated and have an opportunity, as they go out into the 21st century.

As we point out, we are trying to revise something that started in 1934 with people stamping license plates. There is a lot of modern technology, Mr. Speaker. I know all of our colleagues on both sides of the aisle understand that.

If there is some way that we can give that training to these people in the prison system who want to change their lives, and, as soon as they get out, they get a good job, maybe even go to work for one of these private companies that is helping provide for their training through this program, that was a wonderful addition to the bill.

That, in fact, was new since the last time this bill came up. Again, Mr. Conyers, Mr. Watt, Mrs. Maloney, Ms. Waters and Mr. Frank were all very supportive of that.

So the statement that ``if it ain't broke, don't fix it,'' I think it was broke, and I think my good friend from Florida's colleagues felt that it was broken, and in a bipartisan way we are trying to fix it.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume for the purpose of closing.

The gentleman says that is not the most important thing, and I don't disagree with him. I think it is very important. It is not the most important thing. Of course, a lot of ``the most important things'' that he has mentioned this Republican majority has brought to the floor of this House and we have passed, some of that, most of it actually, in a bipartisan way, with support from the other side.

Of course, I yield to my friend, the gentleman from Florida.

Mr. Speaker, as the gentleman from Florida knows, we have passed I guess it is 10 out of 11. We may have one appropriations bill that has not passed the House. All of the rest have. We are waiting on the Senate. We are very confident that we will next week, given the leader's colloquy for what our schedule is, I can't say for sure, but it is my understanding we will be dealing with both the Homeland Security appropriation and the Department of Defense appropriation next week.

As I pointed out, we have passed all of these appropriations bills. We have done our work and we will continue to do our work. We are ready to receive those conference reports.

In the meantime then, what are we to do? Is the gentleman suggesting we sit over here on the leadership majority side and do nothing? Absolutely not, Mr. Speaker. We are doing our work.

This is a very important piece of legislation, and I want to thank my colleague from Michigan (Mr. Hoekstra) for sponsoring it and for being a tireless champion of reform for Federal Prison Industries.

As I discussed in my opening statement, it is important to protect the interests of business without diminishing the effectiveness of our Federal Prison Industries, also referred to as UNICOR. With H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2005, this Congress has an opportunity to promote fair competition and to update UNICOR for the 21st century, as I said earlier.

This body passed similar legislation with an overwhelming 350-65 majority. Federal Prison Industries are important for prisoner behavior control, for the safety of our Federal prison guards, and, furthermore, it serves as an opportunity, and this is most important, for inmates to learn skills necessary for life after prison. It helps reduce the number of repeat offenders and ultimately reduces the stress of our overcrowded prisons. My good friend the gentleman from California (Mr. Costa), of course, mentioned that in describing the facility in his district that is so needed.

This current Federal Prison Industries system is outdated and it still operates off of the same executive order issued by President Franklin Delano Roosevelt in 1934. Considering the global economy and accounting for further changes and the needs and exchange of goods and services in this, the 21st century, it is important to update this program in order to preserve its efficiency for rehabilitating prisoners.

The Federal Prison Industries Competition in Contracting Act of 2005 would preserve the successful formula of the current system with the checks and balances of a competitive market. It is no longer in the best interests of our government or Federal prisons to have a guaranteed artificial market. Our current system is not fair to small businesses who wish to compete for government contracts, it is not fair to the executive agencies trying to work within a tight budget, and it is not fair for the education of prisoners who need to learn new job skills and the nature of a competitive market.

Outside of providing competition for outside businesses, H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2005 would prohibit inmate labor from being sold separate from inmate products, it would provide more remedial education and vocational opportunities for inmates, and it would authorize alternative inmate work opportunities in support of nonprofit community service organizations.

So, Mr. Speaker, in closing, I want to reiterate the diverse support of H.R. 2965, the Federal Prison Industries Competition in Contracting Act of 2005, including businesses, civic organizations and the unions. It is important to pass legislation to reform Federal Prison Industries in order to sustain the program for the 21st century.

I ask my colleagues, please support this rule and the underlying legislation

Mr. Speaker, I yield back the balance of my time, and I move the previous question on the resolution.

The previous question was ordered.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, I rise in strong support of H.R. 2965, the Federal Prison Industries Competition and Contracting Act of 2006. This bill is substantially similar to H.R. 1829, which this body passed overwhelmingly during the 108th Congress by a vote of 350-65.

As reported by the Judiciary Committee, the bill includes additional bipartisan improvements that resulted from negotiations with the Justice Department, prison fellowship, and other interested parties.

Since my early days in the Congress, I have been committed to reforming Federal Prison Industries, or FPI, because I believe the manner in which this program currently operates imposes unacceptable burdens on government agencies, taxpayers, inmates, and private sector businesses.

Under the current system, Federal agencies are required by law to purchase FPI products that meet the agencies' requirements and do not exceed current market prices. The mandatory source requirement eliminates competition with the private sector, harming businesses and stifling the creation of new jobs for law-abiding Americans. FPI enjoys a mandatory market for its goods, a facility to produce them in and cheap labor to manufacture them.

Despite these advantages, government agencies frequently pay more for FPI products than if they were purchased from the private sector. The Government Accountability Office concluded in a 1988 report that ``The only limitation on FPI's price is that it may not exceed the upper end of the current market price range.'' The GAO report also raised questions about the timeliness of delivery of these products and the quality of FPI products.

While the FPI has had serious problems, this legislation does not seek to eliminate it, but would reform FPI to require that it compete for Federal Government contracts in the same manner as other businesses. FPI is well equipped to succeed in the competitive marketplace because it is not faced with the same operating costs as average businesses, such as providing health insurance, retirement benefits, or paying union wages. And the facilities, of course, that FPI does use in the manufacturing process are Federal prisons and not on property tax rolls.

In recent years, FPI has demonstrated its competitiveness by obtaining several large, multiyear contracts with the Department of Defense and other Federal agencies, even though government procurement policies have been changed to permit these agencies to determine whether FPI products meet competitive pricing and quality benchmarks.

This legislation also helps inmates by establishing a position of Inmate Work Training Administrator to create additional inmate work opportunities, and allows FPI to create a program that will allow inmates to perform jobs that are being performed outside the United States. The bill also addresses concerns about providing meaningful training for inmates by requiring FPI to devote some of its earnings to additional inmate vocational training, education opportunities, and release preparation.

The bill increases access to educational opportunities, including remedial and modern, hands-on vocational programs which have been shown to be effective in reducing recidivism. The bill provides alternative inmate work opportunities by authorizing the production of products or services for donation to community service organizations, and allows Federal inmates to perform public service work for units of local government.

Finally, the bill addresses concerns about the low wages paid to inmates by requiring the Secretary of Labor to establish an inmate training wage in consultation with the Attorney General for those performing FPI jobs.

Mr. Chairman, as Members of Congress, we have a duty to ensure that government corporations do not take away opportunities from small businesses. We have a duty to ensure that the taxpayers' money is wisely spent. Neither of these things can be guaranteed under the current FPI regime. By passing this legislation we will ensure that all Federal Government agencies will have the ability to utilize taxpayer dollars in the most efficient manner possible, and that private industry will have the right to compete with FPI for contracts.

H.R. 2965 will also ensure the continued viability of FPI, and provides many avenues for FPI to pursue alternative rehabilitative work and training opportunities for inmates.

Mr. Chairman, I am proud of this comprehensive legislation to reform the Federal Prison Industries. I urge Members to support it.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield 4 minutes to the gentleman from Michigan (Mr. Hoekstra), the author of the bill.

Mr. Chairman, I yield 3 minutes to the gentleman from North Carolina (Mr. Coble).

Mr. Chairman, I yield 1 minute to the gentleman from Minnesota (Mr. Gutknecht).

Mr. Chairman, I yield myself 1 minute.

Mr. Chairman, it is pretty hard for somebody in the private sector that pays taxes on their manufacturing equipment, that pays property taxes on the building that is used to house the manufacturing equipment, that pays their employees a decent wage, that takes out Social Security and State and Federal income taxes and, hopefully, provides benefits, including health care benefits, to compete against those who are working in the prison where the taxpayers pay for the medical benefits, the taxpayers pay for the room and board, and the land and the prison is completely tax exempt.

Now, the gentleman from Minnesota says that what FPI provides is bought by the Department of Defense. What this bill does is to provide the same reforms that were provided a few years earlier with FPI contracting with the Department of Defense. The gentleman from Minnesota says it has worked with the Department of Defense. What we want to do is to have it work with every other Federal agency as successfully as it has done with the Department of Defense.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I offer an amendment.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this manager's amendment would make technical corrections to H.R. 2965. The amendment modifies 13 dates in various provisions of the bill to reflect the passage of time since its introduction, and also corrects one sectional cross-reference, and a reference to an executive branch agency.

In addition, this amendment adds a provision to correct an amendment that was accepted during the Judiciary Committee's markup, which would require Federal Prison Industries, Inc., to establish a cost accounting system. This technical change is necessary to implement the amendment. Finally, the proposed amendment makes a grammatical correction.

The changes are all technical in nature, but essential to the proper implementation of the bill. I urge my colleagues to support the amendment.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself the balance of my time.

I am happy that between the time the gentleman rose to oppose the amendment and the time he started speaking he was persuaded to support the amendment.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I claim the time in opposition to the amendment.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, the underlying bill permits sole-source contracts between the Federal Bureau of Prisons and the Federal Prison Industries. This amendment would extend the sole-source authority to the entire Department of Justice.

Existing law allows a head of any executive agency to make a sole- source contract award, if the agency head makes a determination that such an award is in the ``public interest.'' Following such a determination, Congress must be notified and the contract award suspended for 30 calendar days.

This bill expressly provides the Attorney General to grant a noncompetitive contract whenever it is deemed necessary to maintain prison safety. Additionally, the bill allows the FPI board of directors to exceed the level specified for FPI sales if good cause is shown, which would include maintaining inmate equipment.

DOJ operates a number of agencies, and the cost to the private sector in lost jobs and businesses would be extensive. In addition, the Department of Justice contains several law enforcement agencies, and requiring their personnel to utilize products made by inmates may raise safety concerns.

Finally, the purpose of this legislation is to ensure that the government corporations do not take away opportunities from private businesses and to ensure that the taxpayers' money is wisely spent. The amendment would undermine that goal by denying the entire Department of Justice access to the benefits of competitive pricing, thereby forcing the taxpayer to bear the burden of higher prices.

I urge my colleagues to reject this amendment.

Mr. Chairman, I reserve the balance of my time.

Parliamentary Inquiry

Parliamentary inquiry, Mr. Chairman. Do either Mr. Conyers or I have the right to close?

It is the intention of the gentleman from Wisconsin to yield for the closing statement to the gentleman from Michigan, but I would ask the gentleman from Virginia to use up his time and then Mr. Conyers can close.

Mr. Chairman, I yield the balance of my time to the gentleman from Michigan (Mr. Conyers).

Mr. Chairman, I rise in opposition to the amendment.

Mr. Chairman, this amendment is a bad one because it would authorize the FPI to sell inmate-furnished services in the commercial market, which it first initiated in August of 1998.

In February of that year, FPI obtained a legal memorandum from the Department of Justice Criminal Division stating that the sale of inmate-furnished services was not expressly prohibited by existing law, notwithstanding the fact that 18 U.S.C. section 1761(a) generally prohibits the introduction of results of inmate labor into the commercial market.

This view was later adopted as the Department's official position, and though not issued by the Office of Legal Counsel, the then Attorney General offered FPI's new commercial market service initiative based on the Criminal Division's opinion.

FPI's 1934 authorizing statute prohibits sales into the commercial market. The Attorney General was persuaded to authorize commercial sales of inmate-furnished services by FPI because neither FPI's authorizing statute nor the generally applicable prohibition, also from the 1930s, specifically mentions services. In the 1930s, services were not a large part of the economy, so they were not specifically mentioned by the legislation.

However, the clear intent of the statute was to prohibit such sales in the commercial market, because they would create unfair competition and cause liability concerns. The reinterpretation reversed 75 years of precedent. The bill would clarify that FPI cannot sell either goods or services in the commercial marketplace. It would grandfather all contracts that are operational at the time of the agreement. That for the first time specifically authorized FPI to enter into services contracts with Federal agencies. However, it would not allow new contracts for services in the commercial marketplace.

The amendment would permit FPI to continue its 1998 self-authorized expansion into the commercial services marketplace without restriction. It would continue to subject non-inmate workers being paid market driven wages, and the firms that employ them to unfair competition, using FPI workers being paid an average FPI wage of $.90 an hour. If you are for the minimum wage, you would have to be against this amendment, because there is competition.

Additionally, telemarketing contracts, which are the most common forms of services provided, might allow inmates access to the personal financial information of individuals, raising significant privacy concerns. If you are for privacy, you ought to be against the amendment.

For these reasons, I hope the amendment is defeated.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself as much time as I may consume.

Ladies and gentlemen of the Congress, this is a very important and sensitive issue that is being brought by Chairman Sensenbrenner and myself

today in support of H.R. 2965: How do we deal with the rehabilitation of prisoners and balance it against the rising unemployment that is affecting and afflicting this Nation so much?

As currently drafted, this bill, to me, strikes the appropriate balance between the needs of Federal inmates versus the needs of everyday men and women looking for gainful employment in the civilian workforce; and this was arrived at through a great deal of activity and negotiation with Members on both sides of the aisle.

First, the legislation establishes a gradual phaseout of the current mandatory source requirement. As many know, the mandatory source requirement compels all Federal agencies to purchase their goods and services from the Federal Prison Industries program. A phaseout of this requirement will allow private sector companies to effectively compete for additional Federal contracts, which in turn will produce an increase in private sector jobs, many to be filled by members of our local labor unions across the country.

The second thing we do here is to ensure that the Federal inmates continue to have adequate access to training opportunities during and after the phaseout. The legislation authorizes a minimum of $75 million a year for purposes of educating inmates and teaching them valuable vocational skills. This new language was added to the text of the underlying bill at my request and will guarantee that all Federal inmates are equipped with the necessary skills to successfully reenter society upon their release from prison.

This has been a very difficult problem in the corrections arena over the years. This is not new. It is something we have been working on for a long time, and we have come to this new agreement that is embodied in

I yield 7 minutes to my colleague who has worked on this matter for many years, Bobby Scott, a distinguished member of the Judiciary Committee from Virginia.

Mr. Chairman, will the gentleman yield?

Mr. Chairman, I want to thank Mr. Hoekstra personally for the great work that he has done, not just on this bill but earlier bills as well. This is not a subject on which you have just jumped onboard. I appreciate, across the years, our working together on it.

Mr. Chairman, if the gentleman would yield to just allow me this, because I think what the gentleman from Virginia raised is a very important point, somebody better guarantee me the jobs, too, because that is what this is all about. We are not just writing language to go into the law books. We want some action, and I do not know who gives out guarantees around here, but I will be the first one in line to get it. I am glad that that is your position as well.

Mr. Chairman, I am pleased to yield 2 minutes to the gentleman from Illinois (Mr. Davis), my friend and colleague, who has worked on this area for a long time.

Mr. Chairman, I would like at this time to recognize the gentlewoman from New York (Mrs. Maloney) for 2 minutes.

(Mrs. MALONEY asked and was given permission to revise and extend her remarks.)

Mr. Chairman, I yield 1 minute to my friend and brother, the gentleman from Virginia (Mr. Scott).

Mr. Chairman, I yield myself 1 minute to point out that this bill does not increase crime because we have got a vocational educational training program for inmates that will prepare them not only in vocational skills but prepare them as a whole person.

So to say that we are increasing crime because we are phasing out this Federal Prison Industries program is not exactly accurate. Besides, there is a not-for-profit section that we are going to ramp up. Local governments, school districts, and religious organizations will all be able to benefit under this new provision to create more jobs.

And so I just want to guarantee everybody, and particularly my friend from Virginia, that if this doesn't create more jobs, then I want to change the law myself. But to predict that this is what we are doing is not exactly accurate.

Mr. Chairman, I yield 2 minutes to the gentleman from Massachusetts (Mr. Frank).

Mr. Chairman, I would yield 1 minute more, this is very unusual, but I will yield 1 minute more to Mr. Scott.

Mr. Chairman, I yield 1 minute to the gentleman from Massachusetts.

Mr. Chairman, I yield back the balance of my time.

I do.

Mr. Chairman, I rise to support the amendment because it is technical in nature, and I am sure thereby that there will be little objection to it.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I thank the gentleman for yielding me this time.

When you examine this amendment, this creates a loophole that could undermine the entire bill and any attempt that we have toward educating inmates, teaching vocational skills, and getting contracts for jobs because I, for one, am not for putting this into the tender hands and the gentle mercies of the Attorney General of the United States.

I mean, I have never heard them even suggest that they support anything in this bill. So for me to want to create this carve-out to allow the Attorney General to direct agencies within the Department of Justice to award individual contracts to Federal Prison Industries on a noncompetitive basis is going way too far in terms of us trying to bring some justice to this bill.

Now, we have to control our emotions here, ladies and gentlemen. This is about how we help people who have violated the law return to society. There is more than one way to do it. There are several ways to do it. We are in the process of creating what we think will be a new and better and more balanced way than the way that we have now.

This is not slamming the Federal Prison Industries. As a matter of fact, under the provisions of this bill, they will be able to operate with nonprofits, with government organizations, with churches. There are a lot of ways to deal with this.

The important thing is we all come together and get the money. Somebody said $75 million. Do you know how far $75 million goes in the expenditures that we are making on Iraq every day? This should not be the toughest assignment that those of us who support rehabilitation programs would make.

I urge that if there is any one amendment that should be rejected, it would be one that would leave this measure to the tender mercies of the Attorney General of the United States.

I thank the gentleman for yielding me this time.

I thank the gentleman from Wisconsin.

Mr. Chairman, this amendment raises an interesting question. We exclude services, for-profit business services, but we include everything else. What is the difference between the services and the products? We have to move in an organized fashion or not. To bifurcate this into services being excluded, I think, doesn't make any sense at all.

Now, we are back to the continued mantra that less jobs mean more crime, so if you are for less crime, you

are for more jobs. But what we are doing, in this bill, goes back to an earlier consideration in which we said, which the gentleman from Virginia said, that we could guarantee these jobs and the $75 million, that this would work out.

Of course, I don't know where we get guarantee tickets around here. But I am going to work to the best of my ability, and I have been in this corrections business for quite a while, to make sure that we get the money. It is very, very important that we do that.

I am going to urge our Members not to buy into this half-of-a-loaf notion that services should somehow be allowed to continue and Federal Prison Industries not.

Mr. Chairman, I rise in opposition to the bill. Before I make some comments, let me say I have great respect for the gentleman from Michigan (Mr. Hoekstra). He is a good person. But I do not believe this approach is the way to go.

I appreciate the hard work of Mr. Hoekstra and his staff in trying to develop a bill that addresses concerns raised by myself and others, including the Justice Department. And while I appreciate his genuine efforts to address the issue of providing additional opportunities for inmates, I remain concerned that the alternatives provided in this proposal will not be enough to replace the mandatory source authority currently relied upon by Federal Prison Industries (FPI).

H.R. 2965 would decimate the FPI program by eliminating the mandatory source preference without an adequate replacement. Mandatory source preferences account for the majority of inmate jobs in the program.

I also want to acknowledge Mr. Hoekstra's efforts to work with the Justice Department to craft a workable alternative to the currert mandatory source authority that is responsible for many of jobs currently available through FPI. While there have been a number of changes from the proposal that was considered during the last Congress, the Department of Justice has stated that they cannot support this bill in the current form.

The Department of Justice calls FPI ``the Department's most important correctional management tool.'' DOJ has a fiduciary relationship in running these prisons and I certainly wish they had been stronger in articulating their concerns. However, the fact remains that the bill before us does not have their support.

Winston Churchill said one of the best tests of whether we are truly a civilized people is the temper, the mood of the public in regard to the treatment of crime and criminals.

I like to think of myself as a compassionate conservative. I've had the chance to work with prisoners. Before I was elected, I was involved in a program at Lorton Prison called ``Man to Man'' where we would meet with and counsel the inmates. Knowing what this bill could do in terms of prison work opportunities, I think this bill should be defeated.

You cannot put a man in prison for years and expect him to be rehabilitated without work. The Bible says, ``Remember the prisoner as though in prison with them.''

Currently, FPI is a self-supporting government program that provides job skills opportunities to federal Bureau of Prisons (BOP) inmates by producing products and services for federal agencies. The FPI prison inmate work program fosters BOP prison safety by helping to keep thousands of prison inmates productively occupied in labor-intensive work activities and furthers BOP prisoner rehabilitation by providing prison inmates with opportunities to develop job skills that will allow them to reenter our communities as productive, law-abiding citizens.

This bill would make it difficult to operate a prison. Inmates without work who are idle are prisoners that are going to later come back and commit a crime. Prisoners that participate in the FPI program have a 24 percent lower recidivism rate than prisoners who are not in the program.

This bill also has major budget impacts. To those on my side of the aisle who talk about balancing the budget, the cost of this bill over 5 years will be $500 million. In an era of limited discretionary funding, I have to ask: does it make sense to replace the self-sustaining FPI program with an alternative work program that would cost hundreds of millions a year, without considering any additional staffing needs that would arise from a loss of FPI jobs?

The FPI program provides those incarcerated with a unique opportunity to learn discipline, responsibility, and job skills needed to re-enter society. We should be supporting these prisoners as they serve their time and seek to make the transition back into society, not undercutting one of the most important programs offered by the prison system to help them do so. I am very concerned that the bill before us does not set up an alternative system that can ensure FPI will be able to continue offering inmate work and training opportunities in the future.

In the last four years, the percentage of inmates able to participate in FPI has plummeted from 25 percent to 17 percent, with the BOP estimating a continued decline if this legislation passes. That is the key. There is no alternative system for ensuring there will continue to be jobs if these reforms are implemented. That would be tragic.

If this bill is not amended, I believe, and I may be wrong, that this bill, as surely as the night follows the day, will make it very difficult to operate prisons. With the opportunity to work comes the chance to restore dignity. Later, I am offering a commonsense amendment with my colleagues Messrs. Lungren, Chabot and Scott that would simply postpone the mandatory source phase-out for one year if the FPI prisoner enrollment falls below the current level of 17 percent.

In a time of low national unemployment, it is hard to believe that we are about to make it harder for incarcerated Americans to learn discipline, responsibility, and job skills that working develops.

I urge my colleagues to vote against this underlying bill and for the Lungren-Chabot-Wolf-Scott amendment.