IV

106TH CONGRESS

2D SESSION H. RES. 641

Expressing the sense of the House of Representatives that Federal Prison

Industries, Inc., should immediately cease taking excess Federal computer

equipment and selling such computer equipment and other excess Federal

property in the commercial market.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 18, 2000

Mr. HOEKSTRA (for himself, Mr. FRANK of Massachusetts, Mr. COLLINS, and

Mrs. MALONEY of New York) submitted the following resolution; which

was referred to the Committee on the Judiciary

RESOLUTION

Expressing the sense of the House of Representatives that

Federal Prison Industries, Inc., should immediately cease

taking excess Federal computer equipment and selling

such computer equipment and other excess Federal property in the commercial market.

Whereas information technology and the Internet are playing

an increasingly important role in driving economic growth

and creating job opportunities for millions of Americans;

Whereas inner city and rural areas need access to this growing sector of the economy to improve education, spur economic development, and create opportunity;

Whereas the Computers for Learning Program, established

by Executive Order 12999 which was issued by President
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Clinton on April 17, 1996, created a program to accelerate the transfer of excess Federal computers, related

equipment, and software to schools and other organizations to help bridge the digital divide for inner city and

rural young people;

Whereas Federal Prison Industries, Inc., a wholly-owned Government corporation established in 1935 to centrally

manage the industrial work programs of the Federal Bureau of Prisons, has now grown to be a chain of over 100

factories in 27 States, employing almost 21,000 inmate

workers;

Whereas on February 2, 1998, a legal memorandum which

was issued by a special counsel in the Office of Enforcement Operations within the Criminal Division of the Department of Justice, found that the general statutory

prohibition in force since 1934 on the sale in interstate

commerce of the results of inmate labor did not apply to

services, permitting Federal Prison Industries, Inc., and

prison industry programs operated by the States and

local governments to sell inmate-furnished services in the

commercial market, reversing interpretations and practice

in place for almost 45 years;

Whereas Federal Prison Industries, Inc., then began to exercise its priority status as a Government-owned corporation to take for free increasingly large quantities of computers and other equipment no longer needed by the Department of Defense and other executive departments

and agencies;

Whereas takings by Federal Prison Industries, Inc., from the

Department of Defense grew from 4,372 items with a

purchase value of $17,600,000 in fiscal year 1997, to

59,627 items with a purchase value of $480,800,000 dur-
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ing fiscal year 1999, to 83,113 items with a purchase

value of almost $890,000,000 during the first nine

months of fiscal year 2000, a more than 5,000 percent

increase;

Whereas Federal Prison Industries, Inc., began to offer these

computers, computer-related equipment, and software for

sale to the general public through retail outlets and

websites in direct, but unfair, competition with small

business owners, contrary to the letter and spirit of the

authorizing statute;

Whereas these takings by Federal Prison Industries, Inc.,

were diverting this Federal computer equipment from

other authorized beneficiaries, including State and local

governments, schools, and not-for-profit community service organizations; and

Whereas the Subcommittee on Oversight and Investigations

of the Committee on Education and the Workforce of the

House of Representatives held a hearing on September

26, 2000, receiving testimony from a representative of

the Federal Supply Service of the General Services Administration, a representative of the Defense Reutilization and Marketing Service of the Defense Logistics

Agency, the President of the National Association of

State Agencies for Surplus Property, the executive director of a not-for-profit organization working to bridge the

digital divide in Philadelphia, Pennsylvania, and a small

business owner from Florida: Now, therefore, be it

1 Resolved, That it is the sense of the House of Rep2 resentatives that the Board of Directors of Federal Prison

3 Industries, Inc., should direct its Chief Operating Officer

4 to immediately cease taking computer equipment and
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1 other equipment excess to the needs of various Federal

2 agencies and departments and selling such equipment in

3 the commercial market.

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