Federal Prison Industries - Competition for Government Contractors

Federal Prison Industries (FPI) is a self-supporting wholly-owned Government corporation of the District of Columbia. FPI provides training and employment for prisoners confined in Federal penal and correctional institutions through the sale of its supplies and services to Government agencies. Federal agencies are encouraged to purchase FPI supplies and services to the maximum extent practicable (see FAR 8.6). In fiscal year 2016, FPI generated about $500 million in sales.

FPI's product line is extensive and includes apparel and accessories, electronics, eye-wear, food service, industrial storage, mattresses, linens, beds, and drapes, office furniture, and print products, to name a few. Services include CAD (Computer aided design), data services, call centers, printing and bindery services, and more.

Before purchasing an item of supply listed in the FPI schedule (the catalog of things FPI makes and sells), contracting officers must conduct market research to determine whether the FPI item is comparable to supplies available from the private sector that best meet the Government's needs in terms of price, quality, and time of delivery.

If the FPI item is comparable, contracting officers are required to purchase the item(s) from FPI (unless a waiver is warranted). If the FPI item  is not comparable in terms of either (i) price, (ii) quality, or (iii) delivery time, the contracting officer will acquire the items using competitive procedures. Contracting officers are required to consider timely offers by FPI for competitive award but it is unclear if this ever happens.

FPI should be able to compete on price. It pays its inmate workers between $0.23 and $1.15 per hour. Quality and delivery schedules can sometimes be a different story. As reported on these pages back in 2016, FPI had to recall 44,000 helmets that failed ballistics testing. Furthermore, FPI failed to meet delivery schedules on that order (see Failure to Meet Specifications Results in $3 Million Settlement).