108TH CONGRESS
1ST SESSION
H. R. 1829
AN ACT
To amend title 18, United States Code, to require
Federal Prison Industries to compete for its con-
tracts minimizing its unfair competition with pri-
vate sector firms and their non-inmate workers
and empowering Federal agencies to get the best
value for taxpayers’ dollars, to provide a five-year
period during which Federal Prison Industries
adjusts to obtaining inmate work opportunities
through other than its mandatory source status,
to enhance inmate access to remedial and voca-
tional opportunities and other rehabilitative op-
portunities to better prepare inmates for a suc-
cessful return to society, to authorize alternative
inmate work opportunities in support of non-
profit organizations, and for other purposes.
108TH CONGRESS
1ST SESSION
H. R. 1829
AN ACT
To amend title 18, United States Code, to require Federal
Prison Industries to compete for its contracts minimizing
its unfair competition with private sector firms and their
non-inmate workers and empowering Federal agencies
to get the best value for taxpayers’ dollars, to provide
a five-year period during which Federal Prison Industries
adjusts to obtaining inmate work opportunities through
other than its mandatory source status, to enhance in-
mate access to remedial and vocational opportunities and
other rehabilitative opportunities to better prepare in-
mates for a successful return to society, to authorize
alternative inmate work opportunities in support of non-
profit organizations, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Federal Prison Industries Competition in Contracting
Act of 2003’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec.
1. Short title; table of contents.
Sec.
2. Governmentwide procurement policy relating to purchases from Fed-
eral Prison Industries.
Sec.
3. Public participation regarding expansion proposals by Federal Prison
Industries.
Sec.
4. Transitional mandatory source authority.
Sec.
5. Authority to perform as a Federal subcontractor.
Sec.
6. Inmate wages and deductions.
Sec.
7. Clarifying amendment relating to services.
Sec.
8. Conforming amendment.
Sec.
9. Rules of construction relating to chapter 307.
Sec. 10. Providing additional rehabilitative opportunities for inmates.
Sec. 11. Restructuring the Board of Directors.
Sec. 12. Providing additional management flexibility to Federal Prison Indus-
tries operations.
Sec. 13. Transitional personnel management authority.
Sec. 14. Federal Prison Industries report to Congress.
Sec. 15. Independent study to determine the effects of eliminating the Federal
Prison Industries mandatory source authority.
Sec. 16. Sense of Congress.
Sec. 17. Definitions.
Sec. 18. Implementing regulations and procedures.
Sec. 19. Rule of construction.
Sec. 20. Effective date and applicability.
Sec. 21. Clerical amendments.
Sec. 22. Procurement of goods and services manufactured in the United States.
SEC. 2. GOVERNMENTWIDE PROCUREMENT POLICY RELAT-
ING TO PURCHASES FROM FEDERAL PRISON
INDUSTRIES.
Section 4124 of title 18, United States Code, is
amended to read as follows:
‘‘§ 4124. Governmentwide procurement policy relat-
ing to purchases from Federal Prison In-
dustries
‘‘(a) IN GENERAL.—Purchases from Federal Prison
Industries, Incorporated, a wholly owned Government cor-
poration, as referred to in section 9101(3)(E) of title 31,
may be made by a Federal department or agency only in
accordance with this section.
‘‘(b) SOLICITATION AND EVALUATION OF OFFERS
AND CONTRACT AWARDS.—(1) If a procurement activity
of a Federal department or agency has a requirement for
a specific product or service that is authorized to be of-
fered for sale by Federal Prison Industries, in accordance
with section 4122 of this title, and is listed in the catalog
referred to in subsection (g), the procurement activity
shall solicit an offer from Federal Prison Industries, if the
purchase is expected to be in excess of the micro-purchase
threshold (as defined by section 32(f) of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 428(f))).
‘‘(2) A contract award for such product or service
shall be made using competitive procedures in accordance
with the applicable evaluation factors, unless a determina-
tion is made by the Attorney General pursuant to para-
graph (3) or an award using other than competitive proce-
dures is authorized pursuant to paragraph (7).
‘‘(3) The procurement activity shall negotiate with
Federal Prison Industries on a noncompetitive basis for
the award of a contract if the Attorney General determines
that—
‘‘(A) Federal Prison Industries cannot reason-
ably expect fair consideration to receive the contract
award on a competitive basis; and
‘‘(B) the contract award is necessary to main-
tain work opportunities otherwise unavailable at the
penal or correctional facility at which the contract is
to be performed to prevent circumstances that could
reasonably be expected to significantly endanger the
safe and effective administration of such facility.
‘‘(4) Except in the case of an award to be made pur-
suant to paragraph (3), a contract award shall be made
with Federal Prison Industries only if the contracting offi-
cer for the procurement activity determines that—
‘‘(A) the specific product or service to be fur-
nished will meet the requirements of the procure-
ment 
activity 
(including 
any 
applicable
prequalification requirements and all specified com-
mercial or governmental standards pertaining to
quality, testing, safety, serviceability, and warran-
ties);
‘‘(B) timely performance of the contract can be
reasonably expected; and
‘‘(C) the contract price does not exceed a cur-
rent market price.
‘‘(5) A determination by the Attorney General pursu-
ant to paragraph (3) shall be—
‘‘(A) supported by specific findings by the war-
den of the penal or correctional institution at which
a Federal Prison Industries workshop is scheduled
to perform the contract;
‘‘(B) supported by specific findings by Federal
Prison Industries regarding why it does not expect
to win the contract on a competitive basis; and
‘‘(C) made and reported in the same manner as
a determination made pursuant to section 303(c)(7)
of the Federal Property and Administrative Services
Act of 1949 (41 U.S.C. 253(c)(7)).
‘‘(6) If the Attorney General has not made the deter-
mination described in paragraph (3) within 30 days after
Federal Prison Industries has been informed of a con-
tracting opportunity by a procurement activity, the pro-
curement activity may proceed to conduct a procurement
for the product or service in accordance with the proce-
dures generally applicable to such procurements by the
procurement activity.
‘‘(7) A contract award may be made to Federal Pris-
on Industries using other than competitive procedures if
such product or service is only available from Federal
Prison Industries and the contract may be awarded under
the authority of section 2304(c)(1) of title 10 or section
303(c) of the Federal Property and Administrative Serv-
ices Act of 1949 (41 U.S.C. 252(c)(1)), as may be applica-
ble, and pursuant to the justification and approval re-
quirements relating to such noncompetitive procurements
specified by law and the Governmentwide Federal Acquisi-
tion Regulation.
‘‘(8) A contract award may be made to Federal Pris-
on Industries using other than competitive procedures by
the Federal Bureau of Prisons.
‘‘(c) OFFERS
FROM
FEDERAL
PRISON
INDUS-
TRIES.—A timely offer received from Federal Prison In-
dustries to furnish a product or service to a Federal de-
partment or agency shall be considered for award without
limitation as to the dollar value of the proposed purchase,
unless the contract opportunity has been reserved for com-
petition exclusively among small business concerns pursu-
ant to section 15(a) of the Small Business Act (15 U.S.C.
644(a)) and its implementing regulations.
‘‘(d) PERFORMANCE BY FEDERAL PRISON INDUS-
TRIES.—Federal Prison Industries shall perform its con-
tractual obligations under a contract awarded by a Fed-
eral department or agency to the same extent as any other
contractor.
‘‘(e) FINALITY OF CONTRACTING OFFICER’S DECI-
SION.—(1) A decision by a contracting officer regarding
the award of a contract to Federal Prison Industries or
relating to the performance of such contract shall be final,
unless reversed on appeal pursuant to paragraph (2) or
(3).
‘‘(2) The Chief Executive Officer of Federal Prison
Industries may appeal to the head of a Federal depart-
ment or agency a decision by a contracting officer not to
award a contract to Federal Prison Industries pursuant
to subsection (b)(4). The decision of the head of a Federal
department or agency on appeal shall be final.
‘‘(3) A dispute between Federal Prison Industries
and a procurement activity regarding performance of a
contract shall be subject to—
‘‘(A) alternative means of dispute resolution
pursuant to subchapter IV of chapter 5 of title 5;
or
‘‘(B) final resolution by the board of contract
appeals having jurisdiction over the procurement ac-
tivity’s contract performance disputes pursuant to
the Contract Disputes Act of 1978 (41 U.S.C. 601
et seq.).
‘‘(f) REPORTING OF PURCHASES.—Each Federal de-
partment or agency shall report purchases from Federal
Prison Industries to the Federal Procurement Data Sys-
tem (as referred to in section 6(d)(4) of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 405(d)(4))) in the
same manner as it reports to such System any acquisition
in an amount in excess of the simplified acquisition thresh-
old (as defined by section 4(11) of the Office of Federal
Procurement Policy Act (41 U.S.C. 403(11))).
‘‘(g) CATALOG OF PRODUCTS.—Federal Prison In-
dustries shall publish and maintain a catalog of all specific
products and services that it is authorized to offer for sale.
Such catalog shall be periodically revised as products and
services are added or deleted by its board of directors (in
accordance with section 4122(b) of this title).
‘‘(h) COMPLIANCE WITH STANDARDS.—Federal Pris-
on Industries shall comply with Federal occupational,
health, and safety standards with respect to the operation
of its industrial operations.’’.
SEC. 3. PUBLIC PARTICIPATION REGARDING EXPANSION
PROPOSALS BY FEDERAL PRISON INDUS-
TRIES.
Section 4122(b) of title 18, United States Code, is
amended—
(1) by redesignating paragraph (6) as para-
graph (12); and
(2) by striking paragraphs (4) and (5) and in-
serting the following new paragraphs:
‘‘(4) A decision to authorize Federal Prison Indus-
tries to offer a new specific product or specific service or
to expand the production of an existing product or service
shall be made by its board of directors in conformance
with the requirements of subsections (b), (c), (d), and (e)
of section 553 of title 5, and this chapter.
‘‘(5)(A) Whenever Federal Prison Industries pro-
poses to offer for sale a new specific product or specific
service or to expand production of a currently authorized
product or service, the Chief Operating Officer of Federal
Prison Industries shall submit an appropriate proposal to
the board of directors and obtain the board’s approval be-
fore initiating any such expansion. The proposal submitted
to the board shall include a detailed analysis of the prob-
able impact of the proposed expansion of sales within the
Federal market by Federal Prison Industries on private
sector firms and their non-inmate workers.
‘‘(B)(i) The analysis required by subparagraph (A)
shall be performed by an interagency team on a reimburs-
able basis or by a private contractor paid by Federal Pris-
on Industries.
‘‘(ii) If the analysis is to be performed by an inter-
agency team, such team shall be led by the Administrator
of the Small Business Administration or the designee of
such officer with representatives of the Department of
Labor, the Department of Commerce, and the Federal
Procurement Data Center.
‘‘(iii) If the analysis is to be performed by a private
contractor, the selection of the contractor and the admin-
istration of the contract shall be conducted by one of the
entities referenced in clause (ii) as an independent execu-
tive agent for the board of directors. Maximum consider-
ation shall be given to any proposed statement of work
furnished by the Chief Operating Officer of Federal Prison
Industries.
‘‘(C) The analysis required by subparagraph (A) shall
identify and consider—
‘‘(i) the number of vendors that currently meet
the requirements of the Federal Government for the
specific product or specific service;
‘‘(ii) the proportion of the Federal Government
market for the specific product or specific service
currently furnished by small businesses during the
previous 3 fiscal years;
‘‘(iii) the share of the Federal market for the
specific product or specific service projected for Fed-
eral Prison Industries for the fiscal year in which
production or performance will commence or expand
and the subsequent 4 fiscal years;
‘‘(iv) whether the industry producing the spe-
cific product or specific service in the private
sector—
‘‘(I) has an unemployment rate higher
than the national average; or
‘‘(II) has a rate of unemployment for
workers that has consistently shown an increase
during the previous 5 years;
‘‘(v) whether the specific product is an import-
sensitive product;
‘‘(vi) the requirements of the Federal Govern-
ment and the demands of entities other than the
Federal Government for the specific product or serv-
ice during the previous 3 fiscal years;
‘‘(vii) the projected growth or decline in the de-
mand of the Federal Government for the specific
product or specific service;
‘‘(viii) the capability of the projected demand of
the Federal Government for the specific product or
service to sustain both Federal Prison Industries
and private vendors; and
‘‘(ix) whether authorizing the production of the
new product or performance of a new service will
provide inmates with the maximum opportunity to
acquire knowledge and skill in trades and occupa-
tions that will provide them with a means of earning
a livelihood upon release.
‘‘(D)(i) The board of directors may not approve a
proposal to authorize the production and sale of a new
specific product or continued sale of a previously author-
ized product unless—
‘‘(I) the product to be furnished is a prison-
made product; or
‘‘(II) the service to be furnished is to be per-
formed by inmate workers.
‘‘(ii) The board of directors may not approve a pro-
posal to authorize the production and sale of a new prison-
made product or to expand production of a currently au-
thorized product if the product is—
‘‘(I) produced in the private sector by an indus-
try which has reflected during the previous year an
unemployment rate above the national average; or
‘‘(II) an import-sensitive product.
‘‘(iii) The board of directors may not approve a pro-
posal for inmates to provide a service in which an inmate
worker has access to—
‘‘(I) personal or financial information about in-
dividual private citizens, including information relat-
ing to such person’s real property, however de-
scribed, without giving prior notice to such persons
or class of persons to the greatest extent practicable;
‘‘(II) geographic data regarding the location of
surface and subsurface infrastructure providing com-
munications, water and electrical power distribution,
pipelines for the distribution of natural gas, bulk pe-
troleum products and other commodities, and other
utilities; or
‘‘(III) data that is classified.
‘‘(iv)(I) Federal Prison Industries is prohibited from
furnishing through inmate labor construction services, un-
less to be performed within a Federal correctional institu-
tion pursuant to the participation of an inmate in an ap-
prenticeship or other vocational education program teach-
ing the skills of the various building trades.
‘‘(II) For purposes of this clause, the term ‘construc-
tion’ has the meaning given such term by section 2.101
of the Federal Acquisition Regulation (48 CFR part
‘‘(A) authorize the donation of products pro-
duced or services furnished by Federal industries
and available for sale;
‘‘(B) authorize the production of a new specific
product or the furnishing of a new specific service
for donation; or
‘‘(C) authorize a proposal to expand production
of a currently authorized specific product or specific
service in an amount in excess of a reasonable share
of the market for such product or service, if—
‘‘(i) a Federal agency or department, pur-
chasing such product or service, has requested
that Federal Prison Industries be authorized to
furnish such product or service in amounts that
are needed by such agency or department; or
‘‘(ii) the proposal is justified for other good
cause and supported by at least eight members
of the board.’’.
SEC. 4. TRANSITIONAL MANDATORY SOURCE AUTHORITY.
(a) IN
GENERAL.—Notwithstanding the require-
ments of section 4124 of title 18, United States Code (as
amended by section 2 of this Act), a Federal department
or agency having a requirement for a product that is au-
thorized for sale by Federal Prison Industries and is listed
in its catalog (referred to in section 4124(g) of title 18,
United States Code) shall first solicit an offer from Fed-
eral Prison Industries and make purchases on a non-
competitive basis in accordance with this section or in ac-
cordance with section 2410n of title 10, United States
Code, or section 318 of title III of the Federal Property
and Administrative Services Act of 1949 (as added by sub-
section (i)).
(b) PREFERENTIAL SOURCE STATUS.—Subject to
the limitations of subsection (d), a contract award shall
be made on a noncompetitive basis to Federal Prison In-
dustries if the contracting officer for the procurement ac-
tivity determines that—
(1) the product offered by Federal Prison In-
dustries will meet the requirements of the procure-
ment activity (including commercial or governmental
standards or specifications pertaining to design, per-
formance, testing, safety, serviceability, and warran-
ties as may be imposed upon a private sector sup-
plier of the type being offered by Federal Prison In-
dustries);
(2) timely performance of the contract by Fed-
eral Prison Industries can be reasonably expected;
and
(3) the negotiated price does not exceed a fair
and reasonable price.
(c) CONTRACTUAL TERMS.—The terms and condi-
tions of the contract and the price to be paid to Federal
Prison Industries shall be determined by negotiation be-
tween Federal Prison Industries and the Federal agency
making the purchase. The negotiated price shall not ex-
ceed a fair and reasonable price determined in accordance
with the procedures of the Federal Acquisition Regulation.
(d) PERFORMANCE
OF
CONTRACTUAL
OBLIGA-
TIONS.—
(1) IN
GENERAL.—Federal Prison Industries
shall perform the obligations of the contract nego-
tiated pursuant to subsection (c).
(2) PERFORMANCE DISPUTES.—If the head of
the contracting activity and the Chief Operating Of-
ficer of Federal Prison Industries are unable to re-
solve a contract performance dispute to their mutual
satisfaction, such dispute shall be resolved pursuant
to section 4124(e)(3) of title 18, United States Code
(as added by section 2 of this Act).
(e) LIMITATIONS ON USE OF AUTHORITY.—
(1) IN GENERAL.—As a percentage of the sales
made by Federal Prison Industries during the base
period, the total dollar value of sales to the Govern-
ment made pursuant to subsection (b) and sub-
section (c) of this section shall not exceed—
(A) 90 percent in fiscal year 2005;
(B) 85 percent in fiscal year 2006;
(C) 70 percent in fiscal year 2007;
(D) 55 percent in fiscal year 2008; and
(E) 40 percent in fiscal year 2009.
(2) SALES
WITHIN
VARIOUS
BUSINESS
SEC-
TORS.—Use of the authority provided by subsections
(b) and (c) shall not result in sales by Federal Pris-
on Industries to the Government that are in excess
of its total sales during the base year for each busi-
ness sector.
(3) LIMITATIONS RELATING TO SPECIFIC PROD-
UCTS.—Use of the authorities provided by sub-
sections (b) and (c) shall not result in contract
awards to Federal Prison Industries that are in ex-
cess of its total sales during the base period for such
product.
(4) CHANGES
IN
DESIGN
SPECIFICATIONS.—
The limitations on sales specified in paragraphs (2)
and (3) shall not be affected by any increases in the
unit cost of production of a specific product arising
from changes in the design specification of such
product directed by the buying agency.
(f) DURATION
OF AUTHORITY.—The preferential
contracting authorities authorized by subsection (b) may
not be used on or after October 1, 2009, and become effec-
tive on the effective date of the final regulations issued
pursuant to section 18.
(g) 
DEFINITIONS.—For 
the 
purposes 
of 
this
section—
(1) the term ‘‘base period’’ means the total
sales of Federal Prison Industries during the period
October 1, 2001, and September 30, 2002 (Fiscal
Year 2002);
(2) the term ‘‘business sectors’’ means the eight
product/service business groups identified in the
2002 Federal Prison Industries annual report as the
Clothing and Textiles Business Group, the Elec-
tronics Business Group, the Fleet Management and
Vehicular Components Business Group, the Graphics
Business Group, the Industrial Products Business
Group, the Office Furniture Business Group, the
Recycling Activities Business Group, and the Serv-
ices Business Group; and
(3) the term ‘‘fair and reasonable price’’ shall
be given the same meaning as, and be determined
pursuant to, part 15.8 of the Federal Acquisition
Regulation (48 CFR 15.8).
(h) FINDING BY ATTORNEY GENERAL WITH RE-
SPECT TO PUBLIC SAFETY.—(1) Not later than 60 days
prior to the end of each fiscal year specified in subsection
(e)(1), the Attorney General shall make a finding regard-
ing the effects of the percentage limitation imposed by
such subsection for such fiscal year and the likely effects
of the limitation imposed by such subsection for the fol-
lowing fiscal year.
(2) The Attorney General’s finding shall include a de-
termination whether such limitation has resulted or is like-
ly to result in a substantial reduction in inmate industrial
employment and whether such reductions, if any, present
a significant risk of adverse effects on safe prison oper-
ation or public safety.
(3) If the Attorney General finds a significant risk
of adverse effects on either safe prison management or
public safety, he shall so advise the Congress.
(4) In advising the Congress pursuant to paragraph
(3), the Attorney General shall make recommendations for
additional authorizations of appropriations to provide ad-
ditional alternative inmate rehabilitative opportunities and
additional correctional staffing, as may be appropriate.
(i) PROCEDURAL
REQUIREMENTS
FOR
CIVILIAN
AGENCIES RELATING TO PRODUCTS OF FEDERAL PRISON
INDUSTRIES.—Title III of the Federal Property and Ad-
ministrative Services Act of 1949 (41 U.S.C. 251 et seq.)
is amended by adding at the end the following new section:
‘‘SEC. 318. PRODUCTS OF FEDERAL PRISON INDUSTRIES:
PROCEDURAL REQUIREMENTS.
‘‘(a) MARKET
RESEARCH.—Before purchasing a
product listed in the latest edition of the Federal Prison
Industries catalog under section 4124(d) of title 18,
United States Code, the head of an executive agency shall
conduct market research to determine whether the Federal
Prison Industries product is comparable to products avail-
able from the private sector that best meet the executive
agency’s needs in terms of price, quality, and time of deliv-
ery.
‘‘(b) COMPETITION REQUIREMENT.—If the head of
the executive agency determines that a Federal Prison In-
dustries product is not comparable in price, quality, or
time of delivery to products available from the private sec-
tor that best meet the executive agency’s needs in terms
of price, quality, and time of delivery, the agency head
shall use competitive procedures for the procurement of
the product or shall make an individual purchase under
a multiple award contract. In conducting such a competi-
tion or making such a purchase, the agency head shall
consider a timely offer from Federal Prison Industries.
‘‘(c) IMPLEMENTATION
BY HEAD
OF EXECUTIVE
AGENCY.—The head of an executive agency shall ensure
that—
‘‘(A) a contract solicitation provision requiring
a contractor to offer to make use of products or
services of Federal Prison Industries in the perform-
ance of the contract;
‘‘(B) a contract specification requiring the con-
tractor to use specific products or services (or class-
es of products or services) offered by Federal Prison
Industries in the performance of the contract; or
‘‘(C) any contract modification directing the use
of products or services of Federal Prison Industries
in the performance of the contract.
‘‘(2) In this subsection, the term ‘‘contractor’’, with
respect to a contract, includes a subcontractor at any tier
under the contract.
‘‘(f) PROTECTION OF CLASSIFIED AND SENSITIVE
INFORMATION.—The head of an executive agency may not
enter into any contract with Federal Prison Industries
under which an inmate worker would have access to—
‘‘(1) any data that is classified;
‘‘(2) any geographic data regarding the location
of—
‘‘(A) surface and subsurface infrastructure
providing communications or water or electrical
power distribution;
‘‘(B) pipelines for the distribution of nat-
ural gas, bulk petroleum products, or other
commodities; or
‘‘(C) other utilities; or
‘‘(3) any personal or financial information
about any individual private citizen, including infor-
mation relating to such person’s real property how-
ever described, without the prior consent of the indi-
vidual.
‘‘(g) DEFINITIONS.—In this section:
‘‘(1) The term ‘competitive procedures’ has the
meaning given such term in section 4(5) of the Of-
fice of Federal Procurement Policy Act (41 U.S.C.
403(5)).
‘‘(2) The term ‘market research’ means obtain-
ing specific information about the price, quality, and
time of delivery of products available in the private
sector through a variety of means, which may
include—
‘‘(A) contacting knowledgeable individuals
in government and industry;
‘‘(B) interactive communication among in-
dustry, acquisition personnel, and customers;
and
‘‘(C) interchange meetings or pre-solicita-
tion conferences with potential offerors.’’.
SEC. 5. AUTHORITY TO PERFORM AS A FEDERAL SUBCON-
TRACTOR.
(a) IN GENERAL.—Federal Prison Industries is au-
thorized to enter into a contract with a Federal contractor
(or a subcontractor of such contractor at any tier) to
produce products as a subcontractor or supplier in the per-
formance of a Federal procurement contract. The use of
Federal Prison Industries as a subcontractor or supplier
shall be a wholly voluntary business decision by the Fed-
eral prime contractor or subcontractor, subject to any
prior approval of subcontractors or suppliers by the con-
tracting officer which may be imposed by the Federal Ac-
quisition Regulation or by the contract.
(b) COMMERCIAL SALES PROHIBITED.—The author-
ity provided by subsection (a) shall not result, either di-
rectly or indirectly, in the sale in the commercial market
of a product or service resulting from the labor of Federal
inmate workers in violation of section 1761(a) of title 18,
United States Code. A Federal contractor (or subcon-
tractor at any tier) using Federal Prison Industries as a
subcontractor or supplier in furnishing a commercial prod-
uct pursuant to a Federal contract shall implement appro-
priate management procedures to prevent introducing an
inmate-produced product into the commercial market.
(c) PROHIBITIONS ON MANDATING SUBCONTRACTING
WITH FEDERAL PRISON INDUSTRIES.—Except as author-
ized under the Federal Acquisition Regulation, the use of
Federal Prison Industries as a subcontractor or supplier
of products or provider of services shall not be imposed
upon prospective or actual Federal prime contractors or
a subcontractors at any tier by means of—
(1) a contract solicitation provision requiring a
contractor to offer to make use of Federal Prison
Industries, its products or services;
(2) specifications requiring the contractor to
use specific products or services (or classes of prod-
ucts or services) offered by Federal Prison Indus-
tries in the performance of the contract;
(3) any contract modification directing the use
of Federal Prison Industries, its products or serv-
ices; or
(4) any other means.
SEC. 6. INMATE WAGES AND DEDUCTIONS.
Section 4122(b) of title 18, United States Code (as
amended by section 3 of this Act), is further amended by
adding after paragraph (10) a new paragraph (11) as fol-
lows:
‘‘(11)(A) The Board of Directors of Federal Prison
Industries shall prescribe the rates of hourly wages to be
paid inmates performing work for or through Federal
Prison Industries. The Director of the Federal Bureau of
Prisons shall prescribe the rates of hourly wages for other
work assignments within the various Federal correctional
institutions. In the case of an inmate whose term of im-
prisonment is to expire in not more than 2 years, wages
shall be earned at an hourly rate of not less than $2.50,
but paid at the same rate and in the same manner as to
any other inmate, and any amount earned but not paid
shall be held in trust and paid only upon the actual expira-
tion of the term of imprisonment.
‘‘(B) The various inmate wage rates shall be reviewed
and considered for increase on not less than a biannual
basis.
‘‘(C) The Board of Directors of Federal Prison In-
dustries shall—
‘‘(i) not later than September 30, 2004, in-
crease the maximum wage rate for inmates per-
forming work for or through Federal Prison Indus-
tries to an amount equal to 50 percent of the min-
imum wage prescribed by section 6(a)(1) of the Fair
Labor 
Standards 
Act 
of 
1938 
(29 
U.S.C.
206(a)(1));
‘‘(ii) not later than September 30, 2009, in-
crease such maximum wage rate to an amount equal
to such minimum wage; and
‘‘(iii) request the Secretary of Labor to estab-
lish, not later than October 1, 2004, an ‘inmate
training wage’ pursuant to that Act.
‘‘(D) Wages earned by an inmate worker shall be paid
in the name of the inmate. Deductions, aggregating to not
more than 80 percent of gross wages, shall be taken from
the wages due for—
‘‘(i) applicable taxes (Federal, State, and local);
‘‘(ii) payment of fines and restitution pursuant
to court order;
‘‘(iii) payment of additional restitution for vic-
tims of the inmate’s crimes (at a rate not less than
10 percent of gross wages);
‘‘(iv) allocations for support of the inmate’s
family pursuant to statute, court order, or agree-
ment with the inmate;
‘‘(v) allocations to a fund in the inmate’s name
to facilitate such inmate’s assimilation back into so-
ciety, payable at the conclusion of incarceration; and
‘‘(vi) such other deductions as may be specified
by the Director of the Bureau of Prisons.
‘‘(E) Each inmate worker working for Federal Prison
Industries shall indicate in writing that such person—
‘‘(i) is participating voluntarily; and
‘‘(ii) understands and agrees to the wages to be
paid and deductions to be taken from such wages.’’.
SEC. 7. CLARIFYING AMENDMENT RELATING TO SERVICES.
(a) IN GENERAL.—Section 1761 of title 18, United
States Code, is amended in subsection (a), by striking
‘‘any goods, wares, or merchandise manufactured, pro-
duced, or mined’’ and inserting ‘‘products manufactured,
services furnished, or minerals mined’’.
(b) COMPLETION OF EXISTING AGREEMENTS.—Any
prisoner work program operated by a prison or jail of a
State or local jurisdiction of a State which is providing
services for the commercial market through inmate labor
on October 1, 2002, may continue to provide such com-
mercial services until—
(1) the expiration date specified in the contract
or other agreement with a commercial partner on
October 1, 2002, or
(2) until September 30, 2005, if the prison
work program is directly furnishing the services to
the commercial market.
(c) APPROVAL REQUIRED FOR LONG-TERM OPER-
ATION.—A prison work program operated by a correc-
tional institution operated by a State or local jurisdiction
of a State may continue to provide inmate labor to furnish
services for sale in the commercial market after the dates
specified in subsection (b) if such program has been cer-
tified pursuant to section 1761(c)(1) of title 18, United
States Code, and is in compliance with the requirements
of such subsection and its implementing regulations.
SEC. 8. CONFORMING AMENDMENT.
Section 4122(a) of title 18, United States Code, is
amended by striking ‘‘production of commodities’’ and in-
serting ‘‘production of products or furnishing of services’’.
SEC. 9. RULES OF CONSTRUCTION RELATING TO CHAPTER
307.
Chapter 307 of title 18, United States Code, is fur-
ther amended by adding the following:
‘‘§ 4130. Construction of provisions
‘‘Nothing in this chapter shall be construed—
‘‘(1) to establish an entitlement of any inmate
to—
‘‘(A) employment in a Federal Prison In-
dustries facility; or
‘‘(B) any particular wage, compensation,
or benefit on demand, except as otherwise spe-
cifically provided by law or regulation;
‘‘(2) to establish that inmates are employees for
the purposes of any law or program; or
‘‘(3) to establish any cause of action by or on
behalf of any inmate against the United States or
any officer, employee, or contractor thereof.’’.
SEC. 10. PROVIDING ADDITIONAL REHABILITATIVE OPPOR-
TUNITIES FOR INMATES.
(a) ADDITIONAL EDUCATIONAL, TRAINING, AND RE-
LEASE-PREPARATION OPPORTUNITIES.—
(1) PROGRAM ESTABLISHED.—There is hereby
established the Enhanced In-Prison Educational and
Vocational Assessment and Training Program within
the Federal Bureau of Prisons.
(2) COMPREHENSIVE PROGRAM.—In addition to
such other components as the Director of the Bu-
reau of Prisons deems appropriate to reduce inmate
idleness and better prepare inmates for a successful
reentry into the community upon release, the pro-
gram shall provide—
(A) in-prison assessments of inmates’
needs and aptitudes;
(B) a full range of educational opportuni-
ties;
(C) vocational training and apprentice-
ships; and
(D) comprehensive release-readiness prepa-
ration.
(3) AUTHORIZATION OF APPROPRIATIONS.—For
the purposes of carrying out the program established
by paragraph (1), $75,000,000 is authorized for
each fiscal year after fiscal year 2003, to remain
available until expended. Funds shall be allocated
from the gross profits within the Federal Prison In-
dustries Fund, and, to the extent such amounts are
inadequate, from the General Treasury.
(4) SCHEDULE
FOR
IMPLEMENTATION.—All
components of the program shall be established—
(A) in at least 25 percent of all Federal
prisons not later than 2 years after the date of
the enactment of this Act;
(B) in at least 50 percent of all Federal
prisons not later than 4 years after such date
of enactment;
(C) in at least 75 percent of all Federal
prisons not later than 6 years after such date
of enactment; and
(D) in all Federal prisons not later than 8
years after such date of enactment.
(b) ADDITIONAL INMATE WORK OPPORTUNITIES
THROUGH PUBLIC SERVICE ACTIVITIES.—
(1) IN
GENERAL.—Chapter 307 of title 18,
United States Code, is further amended by inserting
after section 4124 the following new section:
‘‘§ 4124a. 
Additional 
inmate 
work 
opportunities
through public service activities
‘‘(a) IN GENERAL.—Inmates with work assignments
within Federal Prison Industries may perform work for
an eligible entity pursuant to an agreement between such
entity and the Inmate Work Training Administrator in ac-
cordance with the requirements of this section.
‘‘(b) DEFINITION OF ELIGIBLE ENTITIES.—For the
purposes of this section, the term ‘eligible entity’ means
an entity—
‘‘(1) that is an organization described in section
501(c)(3) of the Internal Revenue Code of 1986 and
exempt from taxation under section 501(a) of such
Code and that has been such an organization for a
period of not less than 36 months prior to inclusion
in an agreement under this section;
‘‘(2) that is a religious organization described
in section 501(d) of such Code and exempt from tax-
ation under section 501(a) of such Code; or
‘‘(3) that is a unit of local government, a school
district, or another special purpose district.
‘‘(c) INMATE WORK TRAINING ADMINISTRATOR.—
‘‘(1) The Federal Prison Industries Board of
Directors shall designate an entity as the Inmate
Work Training Administrator to administer the
work-based training program authorized by this sec-
tion.
‘‘(2) In selecting the Inmate Work Training
Administrator, the Board of Directors shall select an
entity—
‘‘(A) that is an organization described in
section 501(c)(3) of the Internal Revenue Code
of 1986 and exempt from taxation under sec-
tion 501(a) of such Code; and
‘‘(B) that has demonstrated, for a period
of not less than 5 years, expertise in the theory
and practice of fostering inmate rehabilitation
through work-based programs in cooperation
with private sector firms.
‘‘(3) With respect to the formation and per-
formance of an agreement authorized by this section,
the Director of the Bureau of Prisons and the Chief
Operating Officer of Federal Prison Industries shall
be responsible only for—
‘‘(A) maintaining appropriate institutional
and inmate security; and
‘‘(B) matters relating to the selection and
payment of participating inmates.
‘‘(d) PROPOSED AGREEMENTS.—An eligible entity
seeking to enter into an agreement pursuant to subsection
(a) shall submit a detailed proposal to the Inmate Work
Training Administrator. Each such agreement shall
specify—
‘‘(1) types of work to be performed;
‘‘(2) the proposed duration of the agreement,
specified in terms of a base year and number of op-
tion years;
‘‘(3) the number of inmate workers expected to
be employed in the specified types of work during
the various phases of the agreement;
‘‘(4) the wage rates proposed to be paid to var-
ious classes of inmate workers; and
‘‘(5) the facilities, services and personnel (other
than correctional personnel dedicated to the security
of the inmate workers) to be furnished by Federal
Prison Industries or the Bureau of Prisons and the
rates of reimbursement, if any, for such facilities,
services, and personnel.
‘‘(e) REPRESENTATIONS.—
‘‘(1) ELEEMOSYNARY WORK ACTIVITIES.—Each
proposed agreement shall be accompanied by a writ-
ten certification by the chief executive officer of the
eligible entity that—
‘‘(A) the work to be performed by the in-
mate workers will be limited to the eleemosy-
nary work of such entity in the case of an enti-
ty described in paragraph (1) or (2) of sub-
section (b);
‘‘(B) the work would not be performed but
for the availability of the inmate workers;
‘‘(C) the work performed by the inmate
workers will not result, either directly or indi-
rectly, in the production of a new product or
the furnishing of a service that is to be offered
for other than resale or donation by the eligible
entity or any affiliate of the such entity.
‘‘(2) PROTECTIONS FOR
NON-INMATE
WORK-
ERS.—Each proposed agreement shall also be ac-
companied by a written certification by the chief ex-
ecutive officer of the eligible entity that—
‘‘(A) no non-inmate employee or volunteer
of the eligible entity (or any affiliate of the enti-
ty) will have his or her job abolished or work
hours reduced as a result of the entity being
authorized to utilize inmate workers; and
‘‘(B) the work to be performed by the in-
mate workers will not supplant work currently
being performed by a contractor of the eligible
entity.
‘‘(f) APPROVAL BY BOARD OF DIRECTORS.—
‘‘(1) IN GENERAL.—Each such proposed agree-
ment shall be presented to the Board of Directors,
be subject to the same opportunities for public com-
ment, and be publicly considered and acted upon by
the Board in a manner comparable to that required
by paragraphs (6) and (7) of section 4122(b).
‘‘(2) MATTERS TO BE CONSIDERED.—In deter-
mining whether to approve a proposed agreement,
the Board shall—
‘‘(A) give priority to an agreement that
provides inmate work opportunities that will
provide participating inmates with the best
prospects of obtaining employment paying a liv-
able wage upon release;
‘‘(B) give priority to an agreement that
provides for maximum reimbursement for in-
mate wages and for the costs of supplies and
equipment needed to perform the types of work
to be performed;
‘‘(C) not approve an agreement that will
result in the displacement of non-inmate work-
ers or volunteers contrary to the representa-
tions required by subsection (e)(2) as deter-
mined by the Board or by the Secretary of
Labor (pursuant to subsection (i)); and
‘‘(D) not approve an agreement that will
result, either directly or indirectly, in the pro-
duction of a new product or the furnishing of
a service for other than resale or donation.
‘‘(g) WAGE RATES AND DEDUCTIONS FROM INMATE
WAGES.—
‘‘(1) IN
GENERAL.—Inmate workers shall be
paid wages for work under the agreement at a basic
hourly rate to be negotiated between the eligible en-
tity and Federal Prison Industries and specified in
the agreement. The wage rates set by the Director
of the Federal Bureau of Prisons to be paid inmates
for various institutional work assignments are spe-
cifically authorized.
‘‘(2) PAYMENT TO INMATE WORKER AND AU-
THORIZED DEDUCTIONS.—Wages shall be paid and
deductions 
taken 
pursuant 
to 
section
4122(b)(11)(C).
‘‘(3) VOLUNTARY PARTICIPATION BY INMATE.—
Each inmate worker to be utilized by an eligible en-
tity shall indicate in writing that such person—
‘‘(A) is participating voluntarily; and
‘‘(B) understands and agrees to the wages
to be paid and deductions to be taken from
such wages.
‘‘(h) ASSIGNMENT TO WORK OPPORTUNITIES.—As-
signment of inmates to work under an approved agree-
ment with an eligible entity shall be subject to the Bureau
of Prisons Program Statement Number 1040.10 (Non-
Discrimination Toward Inmates), as contained in section
551.90 of title 28 of the Code of Federal Regulations (or
any successor document).
‘‘(i) ENFORCEMENT OF PROTECTIONS FOR NON-IN-
MATE WORKERS.—
‘‘(1) PRIOR TO BOARD CONSIDERATION.—Upon
request of any interested person, the Secretary of
Labor may promptly verify a certification made pur-
suant subsection (e)(2) with respect to the displace-
ment of non-inmate workers so as to make the re-
sults of such inquiry available to the Board of Direc-
tors prior to the Board’s consideration of the pro-
posed agreement. The Secretary and the person re-
questing the inquiry may make recommendations to
the Board regarding modifications to the proposed
agreement.
‘‘(2) DURING PERFORMANCE.—
‘‘(A) IN
GENERAL.—Whenever the Sec-
retary deems appropriate, upon request or oth-
erwise, the Secretary may verify whether the
actual performance of the agreement is result-
ing in the displacement of non-inmate workers
or the use of inmate workers in a work activity
not authorized under the approved agreement.
‘‘(B) SANCTIONS.—Whenever the Sec-
retary determines that performance of the
agreement has resulted in the displacement of
non-inmate workers or employment of an in-
mate worker in an unauthorized work activity,
the Secretary may—
‘‘(i) direct the Inmate Work Training
Administrator to terminate the agreement
for default, subject to the processes and
appeals available to a Federal contractor
whose procurement contract has been ter-
minated for default; and
‘‘(ii) initiate proceedings to impose
upon the person furnishing the certifi-
cation regarding non-displacement of non-
inmate workers required by subsection
(d)(2)(B) any administrative, civil, and
criminal sanctions as may be available.’’.
(2) AUTHORIZATION
OF
APPROPRIATION.—
There is authorized to be appropriated $5,000,000
for each of the fiscal years 2004 through 2008 for
the purposes of paying the wages of inmates and
otherwise undertaking the maximum number of
agreements with eligible entities pursuant to section
4124a of title 18, United States Code, as added by
paragraph (1).
(3) CLERICAL AMENDMENT.—The table of sec-
tions for chapter 307 of title 18, United States
Code, is amended by inserting after the item relating
to section 4124 the following new item:
‘‘4124a. Additional inmate work opportunities through public service activities.’’.
(c) INMATE WORK OPPORTUNITIES IN SUPPORT OF
NOT-FOR-PROFIT ENTITIES.—
(1) PROPOSALS FOR DONATION PROGRAMS.—
The Chief Operating Officer of Federal Prison In-
dustries shall develop and present to the Board of
Directors of Federal Prison Industries proposals to
have Federal Prison Industries donate products and
services to eligible entities that provide goods or
services to low-income individuals who would likely
otherwise have difficulty purchasing such products
or services in the commercial market.
(2) SCHEDULE FOR SUBMISSION AND CONSID-
ERATION OF DONATION PROGRAMS.—
(A) INITIAL PROPOSALS.—The Chief Oper-
ating Officer shall submit the initial group of
proposals for programs of the type described in
paragraph (1) within 180 days after the date of
the enactment of this Act. The Board of Direc-
tors of Federal Prison Industries shall consider
such proposals from the Chief Operating Officer
not later than the date that is 270 days after
the date of the enactment of this Act.
(B) 
ANNUAL
OPERATING
PLAN.—The
Board of Directors of Federal Prison Industries
shall consider proposals by the Chief Operating
Officer for programs of the type described in
paragraph (1) as part of the annual operating
plan for Federal Prison Industries.
(C) OTHER
PROPOSALS.—In addition to
proposals submitted by the Chief Operating Of-
ficer, the Board of Directors may, from time to
time, consider proposals presented by prospec-
tive eligible entities.
(3) DEFINITION OF ELIGIBLE ENTITIES.—For
the purposes of this subsection, the term ‘‘eligible
entity’’ means an entity—
(A) that is an organization described in
section 501(c)(3) of the Internal Revenue Code
of 1986 and exempt from taxation under sec-
tion 501(a) of such Code and that has been
such an organization for a period of not less
than 36 months prior to inclusion in a proposal
of the type described in paragraph (1), or
(B) that is a religious organization de-
scribed in section 501(d) of such Code and ex-
empt from taxation under section 501(a) of
such Code.
(4) AUTHORIZATION
OF
APPROPRIATIONS.—
There are authorized to be appropriated $7,000,000
for each of the fiscal years 2004 through 2008 for
the purposes of paying the wages of inmates and
otherwise carrying out programs of the type de-
scribed in paragraph (1).
(d) MAXIMIZING INMATE REHABILITATIVE OPPOR-
TUNITIES
THROUGH
COGNITIVE
ABILITIES
ASSESS-
MENTS.—
(1) DEMONSTRATION PROGRAM AUTHORIZED.—
(A) IN GENERAL.—There is hereby estab-
lished within the Federal Bureau of Prisons a
program to be known as the ‘‘Cognitive Abili-
ties Assessment Demonstration Program’’. The
purpose of the demonstration program is to de-
termine the effectiveness of a program that as-
sesses the cognitive abilities and perceptual
skills of Federal inmates to maximize the bene-
fits of various rehabilitative opportunities de-
signed to prepare each inmate for a successful
return to society and reduce recidivism. The
demonstration program shall be undertaken by
a contractor with a demonstrated record of ena-
bling the behavioral and academic improvement
of adults through the use of research-based sys-
tems that maximize the development of both the
cognitive and perceptual capabilities of a par-
ticipating individual, including adults in a cor-
rectional setting.
(B) SCOPE
OF
DEMONSTRATION
PRO-
GRAM.—The demonstration program shall to
the maximum extent practicable, be—
(i) conducted during a period of three
consecutive fiscal years, commencing dur-
ing fiscal year 2004;
(ii) conducted at 12 Federal correc-
tional institutions; and
(iii) offered to 6,000 inmates, who are
categorized as minimum security or less,
and are within five years of release.
(C) REPORT ON RESULTS OF PROGRAM.—
Not later than 60 days after completion of the
demonstration program, the Director shall sub-
mit to Congress a report on the results of the
program. At a minimum, the report shall in-
clude an analysis of employment stability, sta-
bility of residence, and rates of recidivism
among inmates who participated in the program
after 18 months of release.
(2) AUTHORIZATION
OF
APPROPRIATIONS.—
There is authorized to be appropriated $3,000,000
in each of the three fiscal years after fiscal year
2003, to remain available until expended, for the
purposes of conducting the demonstration program
authorized by subsection (a).
(e) PRERELEASE EMPLOYMENT ASSISTANCE.—
(1) IN GENERAL.—The Director of the Federal
Bureau of Prisons shall, to the maximum extent
practicable, afford to inmates opportunities to par-
ticipate in programs and activities designed to help
prepare such inmates to obtain employment upon re-
lease.
(2) PRERELEASE
EMPLOYMENT
PLACEMENT
ASSISTANCE.—Such prerelease employment place-
ment assistance required by subsection (a) shall
include—
(A) training in the preparation of resumes
and job applications;
(B) training in interviewing skills;
(C) training and assistance in job search
techniques;
(D) conduct of job fairs; and
(E) such other methods deemed appro-
priate by the Director.
(3) PRIORITY PARTICIPATION.—Priority in pro-
gram participation shall be accorded to inmates who
are participating in work opportunities afforded by
Federal Prison Industries and are within 24 months
of release from incarceration.
SEC. 11. RESTRUCTURING THE BOARD OF DIRECTORS.
Section 4121 of title 18, United States Code, is
amended to read as follows:
‘‘§ 4121. Federal Prison Industries; Board of Direc-
tors: executive management
‘‘(a) Federal Prison Industries is a government cor-
poration of the District of Columbia organized to carry
on such industrial operations in Federal correctional insti-
tutions as authorized by its Board of Directors. The man-
ner and extent to which such industrial operations are car-
ried on in the various Federal correctional institutions
shall be determined by the Attorney General.
‘‘(b)(1) The corporation shall be governed by a board
of 11 directors appointed by the President.
‘‘(2) In making appointments to the Board, the
President shall assure that 3 members represent the busi-
ness community, 3 members represent organized labor, 1
member shall have special expertise in inmate rehabilita-
tion techniques, 1 member represents victims of crime, 1
member represents the interests of Federal inmate work-
ers, and 2 additional members whose background and ex-
pertise the President deems appropriate. The members of
the Board representing the business community shall in-
clude, to the maximum extent practicable, representation
of firms furnishing services as well as firms producing
products, especially from those industry categories from
which Federal Prison Industries derives substantial sales.
The members of the Board representing organized labor
shall, to the maximum practicable, include representation
from labor unions whose members are likely to be most
affected by the sales of Federal Prison Industries.
‘‘(3) Each member shall be appointed for a term of
5 years, except that of members first appointed—
‘‘(A) 2 members representing the business com-
munity shall be appointed for a term of 3 years;
‘‘(B) 2 members representing labor shall be ap-
pointed for a term of 3 years;
‘‘(C) 2 members whose background and exper-
tise the President deems appropriate for a term of
3 years;
‘‘(D) 1 member representing victims of crime
shall be appointed for a term of 3 years;
‘‘(E) 1 member representing the interests of
Federal inmate workers shall be appointed for a
term of 3 years;
‘‘(F) 1 member representing the business com-
munity shall be appointed for a term of 4 years;
‘‘(G) 1 member representing the business com-
munity shall be appointed for a term of 4 years; and
‘‘(H) the members having special expertise in
inmate rehabilitation techniques shall be appointed
for a term of 5 years.
‘‘(4) The President shall designate 1 member of the
Board as Chairperson. The Chairperson may designate a
Vice Chairperson.
‘‘(5) Members of the Board may be reappointed.
‘‘(6) Any vacancy on the Board shall be filled in the
same manner as the original appointment. Any member
appointed to fill a vacancy occurring before the expiration
of the term for which the member’s predecessor was ap-
pointed shall be appointed for the remainder of that term.
‘‘(7) The members of the Board shall serve without
compensation. The members of the Board shall be allowed
travel expenses, including per diem in lieu of subsistence,
at rates authorized for employees of agencies under sub-
chapter I of chapter 57 of title 5, United States Code,
to attend meetings of the Board and, with the advance
approval of the Chairperson of the Board, while otherwise
away from their homes or regular places of business for
purposes of duties as a member of the Board.
‘‘(8)(A) The Chairperson of the Board may appoint
and terminate any personnel that may be necessary to en-
able the Board to perform its duties.
‘‘(B) Upon request of the Chairperson of the Board,
a Federal agency may detail a Federal Government em-
ployee to the Board without reimbursement. Such detail
shall be without interruption or loss of civil service status
or privilege.
‘‘(9) The Chairperson of the Board may procure tem-
porary and intermittent services under section 3109(b) of
title 5, United States Code.
‘‘(c) The Director of the Bureau of Prisons shall
serve as Chief Executive Officer of the Corporation. The
Director shall designate a person to serve as Chief Oper-
ating Officer of the Corporation.’’.
SEC. 12. PROVIDING ADDITIONAL MANAGEMENT FLEXI-
BILITY TO FEDERAL PRISON INDUSTRIES OP-
ERATIONS.
Section 4122(b)(3) of title 18, United States Code,
is amended—
(1) by striking ‘‘(3)’’ and inserting ‘‘(3)(A)’’;
and
(2) by adding at the end the following new
paragraphs:
‘‘(B) Federal Prison Industries may locate more than
one workshop at a Federal correctional facility.
‘‘(C) Federal Prison Industries may operate a work-
shop outside of a correctional facility if all of the inmates
working in such workshop are classified as minimum secu-
rity inmates.’’.
SEC. 13. TRANSITIONAL PERSONNEL MANAGEMENT AU-
THORITY.
Any correctional officer or other employee of Federal
Prison Industries being paid with nonappropriated funds
who would be separated from service because of a reduc-
tion in the net income of Federal Prison Industries during
any fiscal year specified in section 4(e)(1) shall be—
(1) eligible for appointment (or reappointment)
in the competitive service pursuant to title 5, United
States Code;
(2) registered on a Bureau of Prisons reemploy-
ment priority list; and
(3) given priority for any other position within
the Bureau of Prisons for which such employee is
qualified.
SEC. 14. FEDERAL PRISON INDUSTRIES REPORT TO CON-
GRESS.
Section 4127 of title 18, United States Code, is
amended to read as follows:
‘‘§ 4127. Federal Prison Industries report to Congress
‘‘(a) IN GENERAL.—Pursuant to chapter 91 of title
31, the board of directors of Federal Prison Industries
shall submit an annual report to Congress on the conduct
of the business of the corporation during each fiscal year
and the condition of its funds during the fiscal year.
‘‘(b) CONTENTS OF REPORT.—In addition to the
matters required by section 9106 of title 31, and such
other matters as the board considers appropriate, a report
under subsection (a) shall include—
‘‘(1) a statement of the amount of obligations
issued under section 4129(a)(1) of this title during
the fiscal year;
‘‘(2) an estimate of the amount of obligations
that will be issued in the following fiscal year;
‘‘(3) an analysis of—
‘‘(A) the corporation’s total sales for each
specific product and type of service sold to the
Federal agencies and the commercial market;
‘‘(B) the total purchases by each Federal
agency of each specific product and type of
service;
‘‘(C) the corporation’s share of such total
Federal Government purchases by specific prod-
uct and type of service; and
‘‘(D) the number and disposition of dis-
putes submitted to the heads of the Federal de-
partments and agencies pursuant to section
4124(e) of this title;
‘‘(4) an analysis of the inmate workforce that
includes—