Federal Prison Industries
Federal Prison Industries, Inc. (FPI), doing business as UNICOR (stylized as unicor) since 1977, is a wholly owned United States government corporation created in 1934 as a prison labor program for inmates within the Federal Bureau of Prisons, and a component of the Department of Justice. It is headquartered in Washington, DC.
|Founded||June 23, 1934|
|David D. Spears, Chairman|
Donald R. Elliott, Vice Chairman
|Owner||Federal Bureau of Prisons|
Number of employees
A statute in May 1930 provided for the employment of prisoners, the creation of a corporation for the purpose was authorized by a statute in June 1934, and the Federal Prison Industries was created by executive order in December 1934. The Federal Prison Industry was created as a way for inmates to maintain a job that promoted their rehabilitation back into society. This rehabilitation includes payment, ranging from $0.23 to $1.15 per hour, as well as learning new skills provided by the job industry the inmate was given. There are a variety of different aspects under which one could pursue a job, including agribusiness, clothing and textiles, electronics, recycling, office furniture, and services. If an inmate has a debt they must pay off, they are required by law to put at least 50% of their earnings towards paying off this debt. The Federal Prison Industry had many restrictions that made it difficult to compete with other industries. Following World War II, the FPI began to lose these barriers though. This is due to the fact that they no longer had to be funded by the military to make the resources needed for the war. They then found new funding from civilians tending to their day to day needs, and later when the Korean War began, the military funding was established again. It was not until the 1960s when the idea of rehabilitation of prisoners was fully embraced. The inmates were provided with jobs to help them appear to be a part of something and essential to their workplace, so they could be seen with potential again. In 1977, FPI gained the trade name UNICOR. The prisons began to overpopulate in the 1980s after stricter laws became present. This led UNICOR to be more aware of their organization and production of inmates and their corresponding jobs, making the industry remain efficient for its customers. In hopes to create and sustain a new client base, UNICOR decided to campaign, but this brought about controversy within citizens. Although it did benefit them by bringing them more clients, it also made some individuals fear that it was at an unfair advantage and would negatively affect the private sector by providing low cost goods and not having to pay the workers as much. UNICOR countered this with the fact that they do not actually impact the private sector significantly and it is beneficial for the inmates to take part in by giving them life skills. The industry was modernized beginning in 2000 following new technological advances and adopting the use of the Internet, thus maximizing product efficiency, delivery, and communications. Since the early 2000s up until the present day, UNICOR has only increased in the number of inmates it has employed and further embraced its philosophy of improving the lives of inmates throughout the country. In the most recent years, beginning in 2011, UNICOR has been working on an environmental initiative plan to create more eco-friendly ways of working in the industry. Inmates are now able to receive certifications in various aspects while in prison as well, such as a commercial drivers’ license, SAP technician, and quality improvement associate as of 2016. UNICOR is constantly updating to stay in tune with the rest of the changing world and continues to supply jobs to 18,000 inmates every year.
While in the program, inmates are given vocational training. By equipping inmates with a skill set in a vocation, UNICOR aims to reduce recidivism and give former inmates the means to support themselves in post-institutional life. There is a large debate over the Federal Prison Industry and its motivations. Some people believe that the FPI is just a business competing with other industries and making a profit off of its workers, while others believe it is what it was originally intended to be- a place for troubled inmates to go through rehabilitation and better themselves and learn skills in order to one day go back into the real world as a “new” person who has grown from their past. The individuals fighting against the FPI oppose its values because it often requires mandatory purchases from other companies. Opposers claim that this is unfair to be required to purchase these products because it is only profiting incarcerated individuals and a “monopoly”-like corporation. Citizens have become angered by this because they believe it is taking away jobs that are rightfully theirs rather than prisoners who have committed horrific crimes. It is also discussed how this provides many advantages over that of the private industry, seeing that the FPI is a federal government organization, it does not have to pay any of the taxes that an industry would normally have to pay. This allows the FPI to maintain a higher profit off of its workers since they are not being paid as highly. The FPI then argues that it has to make up for these advantages through not gaining as much valuable work as the private industry has. They claim that the workers are not as highly skilled and trained, seeing that they are inmates, and they do not care to produce as quality work compared to those workers in the private industry who generally work hard and are paid to produce superior work. The prison industry also notes that they have to cover the costs of additional expenses that other industries do not have to worry about. These additional costs would include paying the wages of correctional officers who need to watch over the prisoners while they are working to make sure none of them stray from what they are supposed to be doing and the workplace remains a safe environment to be in. Other benefits of the Federal Prison Industry that are discussed is the fact that it promotes a more substantial change in the inmate. Providing the inmate with a job gives them something to do in their free time while in prison, rather than wasting time or getting into trouble. Studies have also proved that once inmates have been released from prison, after having worked in the prison, they were more likely to become employed within only a couple months than those who did not work in prison. The studies also proved it to be beneficial for those inmates who maintained jobs to keep from relapsing and being incarcerated again.
UNICOR operates at no cost to taxpayers, in that it receives no appropriated funds from Congress to run its operations. In fiscal year 2016, UNICOR had net losses of $18 million. In fiscal year 2016, approximately 17,900 inmates participated in the UNICOR program, which equates to approximately 10% of the inmate population eligible to participate in this program in BOP-managed facilities. All federally incarcerated individuals are expected to work in BOP-managed facilities. In general, those who choose to participate in UNICOR's voluntary industrial work program earn between $0.23 and $1.15 per hour. There are exceptions, in particular the Prison Industry Enhancement Certification program, whereby inmates earn up to the prevailing wages paid for comparable work performed in the locality. Deductions are then taken for taxes, victim restitution, program costs and court-imposed legal obligations. In 2016, UNICOR generated $498 million in sales, of which 72% was used to purchase raw materials, equipment and other supplies to produce the products and services it offers for sale; 23% paid staff salaries; and 5% paid inmate workforce wages. In fiscal year 2016, FPI’s business were organized, managed, and internally reported as six operation segments based upon products and services. These segments are Agribusiness, Clothing and Textiles, Electronics, Office Furniture, Recycling, and Services.
As of August 2016, UNICOR operates 66 factory operations within 52 federal prisons, nationwide, offering more than 100 products and services in 80 Federal Supply Classifications (FSCs), in areas including clothing and textiles, electronics, fleet management and vehicular components, industrial products, office furniture, recycling activities; and services including data entry, computer-aided design (CAD), and distribution. While UNICOR's customer base consists primarily of federal government agencies, it also collaborates with private sector companies to support their subcontracting needs. It offers qualifying U.S. manufacturers domestic facilities and inmate workforce resources to repatriate their operations, with costs comparable to those of offshore production and other benefits.
Federal Acquisition Regulation (FAR) Subpart 8.6 outlines mandatory source procurement provisions under which federal agencies are to purchase products which are listed on UNICOR's Schedule of Products and deemed comparable in price, quality and delivery to those available from the private sector. While the guidelines differ slightly between Department of Defense and civilian agencies, in all cases decision-making purchasing authority rests with the agency's contracting officials. In 2003, UNICOR's Board of Directors exempted micro-purchase level orders of $2,500 and under from the FAR provision which required agencies to obtain waiver approval from UNICOR as a condition for purchasing like items from the private sector. In 2016, the Board increased the "administrative waiver" amount to $3,500, in line with updated micro-purchase levels. Federal agencies are authorized to purchase services from FPI, but not required to do so.
Under current law, all physically able inmates who are not a security risk or have a health exception are required to work, either for UNICOR or at some other prison job. Inmates earn from US$0.23 per hour up to a maximum of US$1.15 per hour, and all inmates with court-ordered financial obligations must use at least 50% of this UNICOR income to satisfy those debts.
FPI has manufactured a diverse set of products, and provided a range of services offerings, in accordance with its statutory mandate, for the Federal government for over 80 years. One report detailed a FPI operation at a California prison in which inmates de-manufactured computer cathode-type monitors. Industry standard practice for this mandates a mechanical crushing machine to minimize danger from flying glass, with an isolated air system to avoid releasing lead, barium, phosphor compounds to the workplace atmosphere. At the FPI facility prisoners demanufactured CRTs with hammers. FPI initiated corrective action to address this finding, and claims to currently meet or exceed industry standards in its recycling operations.
Combat helmets produced by FPI at one factory were at the center of a US Department of Justice lawsuit and $3 million settlement paid by ArmorSource, the prime contractor. The U.S. Attorney's Offices declined to criminally prosecute or file any civil action against FPI staff. The helmets were produced for ArmorSource between 2008 and 2009 and failed to meet standards. The DOJ investigation did not develop any information to indicate military personnel sustained injury or death as a result of the defective ACH helmets. Immediately after FPI leadership became aware of the manufacturing concerns surrounding the ACH helmets, FPI began taking corrective action. FPI recalled its only shipment of Lightweight helmets for re-inspection, and ensured no Lightweight Helmets manufactured at the factory were sent to the military. The recall of both helmets cost FPI $19 million. With Defense Contract Management Agency audit staff, FPI identified opportunities to improve its Quality Management System in areas including improved management staff oversight, proper control of quality procedures, training, and implementation of corrective action. FPI implemented new procedures to address these areas.
- "UNICOR - FAQs: General". Unicor.gov. Retrieved 14 October 2017.
- "UNICOR - Board of Directors". Unicor.gov. Retrieved 14 October 2017.
- "FEDERAL PRISON INDUSTRIES, INC. : Fiscal Year 2016 Annual Management Report" (PDF). Unicor.gov. Retrieved 14 October 2017.
- Pub.L. 71–271, 46 Stat. 391, enacted May 27, 1930
- Pub.L. 73–461, 48 Stat. 1211, enacted June 23, 1934
- Executive Order 6917 of 11 December 1934
- "Federal Prison Industries: Background, Debate, Legislative History, and Policy Options". www.everycrsreport.com. Retrieved 2019-10-18.
- "Factories With Fences: The History of Federal Prison Industries" (PDF). Unicor. 1996. Retrieved 2019. Check date values in:
- "Archived copy". Archived from the original on 2009-05-08. Retrieved 2009-04-06.CS1 maint: archived copy as title (link)
- James, Nathan (2007-07-13). "Federal Prison Industries". Federal Publications.
- Thompson, Larry D. (2004-03-01). "Federal Prison Industries: Fair to business, vital to society". Brookings. Retrieved 2019-10-18.
- "UNICOR - FAQs: General". Unicor.gov. Retrieved 14 October 2017.
- >/ "UNICOR Home > Business Opportunities > Prison Industry Enhancement Certification Program". Unicor.gov. Retrieved 14 October 2017.[permanent dead link]
- Federal Prison Industries RL32380 (PDF), Congressional Research Service, July 13, 2007
- "UNICOR - Schedule of Products and Services". Unicor.gov. Retrieved 14 October 2017.
- "UNICOR Home > News & Publications > Annual Reports > 2015 Annual Financial Management Report" (PDF). Unicor.gov. Archived from the original on 29 March 2017. Retrieved 14 October 2017.
- "UNICOR - Reshoring". Unicor.gov. Retrieved 14 October 2017.
- GovTribe. "Department of the Army W91CRB08D0045-0015 To Unicor $42.5k". govtribe.com.
- GovTribe. "Department of the Army W91CRB08D0045 To Unicor $265.8m". govtribe.com.
- "UNICOR - Ordering Procedures". Unicor.gov. Retrieved 14 October 2017.
- Federal Acquisition Regulation; FPI Blanket Waiver Threshold 81 FR 45854-01, Westlaw, July 14, 2016
- Title XXIX, §2905 of the Crime Control Act of 1990 (P.L. 101-647) required that all offenders in federal prisons must work (the act permitted limitations to this rule on security and health-related grounds).
- "A Review of Federal Prison Industries Electronic-Waste Recycling Program" (PDF). US Department of Justice. US Department of Justice. Archived from the original (PDF) on 28 June 2016. Retrieved 22 September 2016.
- "A Review of Federal Prison Industries Electronic-Waste Recycling Program, Attachments 4 and 5, pages 421-426" (PDF). US Department of Justice. US Department of Justice. Archived from the original (PDF) on 28 June 2016. Retrieved 22 September 2016.
- "DEFENSE CONTRACTOR ARMORSOURCE LLC AGREES TO PAY $3 MILLION TO SETTLE FALSE CLAIMS ACT ALLEGATIONS, page 7" (PDF). US Department of Justice. US Department of Justice. Retrieved 19 August 2016.
- "Investigative Summary Findings of Fraud and Other Irregularities Related to the Manufacture and Sale of Combat Helmets by the Federal Prison Industries and ArmorSource, LLC, to the Department of Defense, page 2" (PDF). US Department of Justice. US Department of Justice. Retrieved 19 August 2016.
- Steele, Tom (30 August 2016). "Inmates at Texas prison produced faulty helmets for military, costing government $19M". Dallas Morning News. Retrieved 22 September 2016.
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