HB654: prohibiting the sale or resale of goods or services produced using inmate labor.

HB 654-FN-LOCAL – AS INTRODUCED

2005 SESSION

05-0774

04/09

HOUSE BILL 654-FN-LOCAL

AN ACT prohibiting the sale or resale of goods or services produced using inmate labor.

SPONSORS: Rep. Ingbretson, Graf 5; Rep. Giuda, Graf 5

COMMITTEE: Criminal Justice and Public Safety

ANALYSIS

This bill prohibits the state prison and the county departments of corrections from engaging in the sale or resale of goods or services produced using inmate labor.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

05-0774

04/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Five

AN ACT prohibiting the sale or resale of goods or services produced using inmate labor.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Section; State Prisons; Prohibition on Sale or Resale of Goods or Services Produced Using Inmate Labor. Amend RSA 622 by inserting after section 26 the following new section:

622:26-a Prohibition on Sale or Resale of Goods or Services Produced Using Inmate Labor.

I. Except as otherwise provided in this section, no state agency shall engage in any activity which competes with a private sector business producing the same goods or services. In this section “activity” means the sale or resale of goods or services by a state agency that produces such goods or services using inmate labor.

II. Nothing in this section shall prevent the state prison from providing goods or services as provided in RSA 622:28.

III. Any person aggrieved by activity prohibited under this section may file a complaint with the attorney general who shall conduct an investigation into the circumstances of the complaint. If the attorney general finds evidence of prohibited activity, an order shall be issued ordering the offending agency to cease such activity immediately. Failure to comply with such order shall subject the offending agency to a fine of not less than $100 nor more than $1,000 per day of noncompliance, and shall render the agency liable for damages.

2 New Section; County Departments of Correction; Prohibition on Sale or Resale of Goods or Services Produced Using Inmate Labor. Amend RSA 30-B by inserting after section 24 the following new section:

30-B:25 Prohibition on Sale or Resale of Goods or Services Produced Using Inmate Labor.

I. Except as otherwise provided in this section, no county department shall engage in any activity which competes with a private sector business producing the same goods or services. In this section “activity” means the sale or resale of goods or services by a county department that produces such goods or services using inmate labor.

II. Any person aggrieved by activity prohibited under this section may file a complaint with the attorney general who shall conduct an investigation into the circumstances of the complaint. If the attorney general finds evidence of prohibited activity, an order shall be issued ordering the offending department to cease such activity immediately. Failure to comply with such order shall subject the offending department to a fine of not less than $100 nor more than $1,000 per day of noncompliance, and shall render the department liable for damages.

3 Repeal. RSA 622:26, relative to sale of prison products, is repealed.

4 Effective Date. This act shall take effect January 1, 2006.

LBAO

05-0774

Revised 2/23/05

HB 654 FISCAL NOTE

AN ACT prohibiting the sale or resale of goods or services produced using inmate labor.

FISCAL IMPACT:

The Department of Corrections indicates state revenue will decrease by $369,000 in FY 2006, $774,900 in FY 2007, $813,645 in FY 2008 and $854,327 in FY 2009. Local expenditures will increase by $12,200 in FY 2006, $25,620 in FY 2007, $26,901 in FY 2008 and $28,246 in FY 2009. County expenditures will increase by $1,300 in FY 2006, $2,730 in FY 2007, $2,867 in FY 2008 and $3,010 in FY 2009. The Association of Counties estimated that county revenue will decrease by $1,022,490 in FY 2006 and by $2,044,980 in FY 2007 and each year thereafter. There will be no fiscal impact on state expenditures or local revenue.

METHODOLOGY:

The Department of Corrections stated that total Prison Industries sales for FY 2005 were $1,960,000 and they estimate an approximate 5% increase in sales each year thereafter. The Department further stated that 36.9% of all Prison Industries sales are to non-state of New Hampshire agencies, and that sale to county and local government results in at least 10% savings to each of them. This bill is effective January 1, 2006, amounts are reduced to reflect of a fiscal year. Based on these assumptions, the Department calculated the loss of revenue to the state and increased cost to the counties and locals as follows:

FY 2005

FY 2006

FY 2007

FY 2008

FY 2009

Total Industries

Sales

$1,960,000

$2,000,000

$2,100,000

$2,205,000

$2,315,250

Total Non-Agency

Sales @ 36.9%

723,240

738,000

774,900

813,645

854,327

Effective 1/1/06

369,000

Sales to Cities & Towns

239,035

244,000

256,200

269,010

282,460

Loss of Savings to Cities & Towns (-10%)

23,904

24,400

25,620

26,901

28,246

Effective 1/1/06

12,200

Sales to NH Counties

25,744

26,000

27,300

28,665

30,098

Loss of Savings to Counties (-10%)

2,574

2,600

2,730

2,867

3,010

Effective 1/1/06

1,300

The Association of Counties stated this bill would prohibit the in-state sale of products made or manufactured at county departments of corrections. In 2004 the aggregate sale of such products from the 10 counties was $2,044,980. The Association estimates that as a result, county revenue will be reduced by $2,044,980 in FY 2006 and each year thereafter.