Federal Prison Industries: Limited Data Available on Customer
Satisfaction (Letter Report, 03/16/98, GAO/GGD-98-50).

Pursuant to a congressional request, GAO provided information on whether
Federal Prison Industries (FPI) collects and maintains data that would
enable it to make reliable, generalizable statements about the
satisfaction of its federal agency customers with respect to the
quality, cost, and timely delivery of FPI's products, focusing on: (1)
if FPI has data, either from its management information system or other
sources, to support overall conclusions about how federal customers who
buy and use its products and services view their timeliness, price, and
quality; and (2) whether agencies who are among the largest buyers of
FPI products and services monitor FPI's performance the same way they do
commercial vendors in terms of timeliness, price, and quality.

GAO noted that: (1) FPI has been the subject of substantial debate over
the years, much of which has centered on the timeliness, price, and
quality of its products; (2) missing from this debate have been
convincing data that show whether federal customers who buy and use FPI
products and services are satisfied with FPI's performance; (3) FPI has
a variety of management information systems that allow it to track
customer orders and react to complaints; (4) however, FPI does not have
a systematic or structured process for collecting and analyzing customer
satisfaction data so that conclusions can be drawn about customer
satisfaction; (5) FPI's efforts to gauge customer satisfaction have been
limited to relying on narrowly scoped surveys as well as other efforts;
(6) without convincing data on customer satisfaction, FPI: (a) remains
vulnerable to assertions by its critics that federal customers are
dissatisfied and, in turn, should no longer be required to buy FPI
products; and (b) may miss opportunities to improve its operations by
having better data on how federal customers view its performance in the
areas of timeliness, price, and quality; (7) furthermore, FPI's lack of
a systematic approach for collecting these data appears inconsistent
with contemporary management principles used by both public and private
sector organizations; (8) regarding agencies' efforts to monitor FPI
performance, major customer agencies that GAO contacted stated that they
consider price when awarding contracts and monitor factors like quality
and timeliness while administering contracts for all vendors, including
FPI; (9) it should be recognized, however, that the contracting
officer's leverage in resolving procurement problems is different for
FPI than for private sector vendors since the rules that typically
govern contracts with private sector vendors do not apply to FPI; (10)
in this regard, on September 13, 1993, the Acting Attorney General
issued a legal opinion that FPI, as a seller of goods to the federal
government, is not covered by the Federal Aquisition Regulations (FAR),
and must be treated under its authorizing legislation FAR Subpart 8.6;
(11) furthermore, agencies cannot use past performance information to
deny awarding a contract to FPI because, under the law, FPI is a
mandatory source of supply; and (12) however, at FPI's discretion,
agencies can use it to negotiate with FPI factors such as product
quality or delivery time frames, or to seek a waiver from FPI so that
they can buy from a commercial vendor that can better meet their quality
or delivery requirements.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  GGD-98-50
     TITLE:  Federal Prison Industries: Limited Data Available on 
             Customer Satisfaction
      DATE:  03/16/98
   SUBJECT:  Correctional facilities
             Customer service
             Contractor performance
             Management information systems
             Contract monitoring
             Federal procurement
             Waivers
             Data collection
             Surveys
IDENTIFIER:  National Performance Review
             
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Cover
================================================================ COVER


Report to Congressional Requesters

March 1998

FEDERAL PRISON INDUSTRIES -
LIMITED DATA AVAILABLE ON CUSTOMER
SATISFACTION

GAO/GGD-98-50

FPI Customer Satisfaction

(240265)


Abbreviations
=============================================================== ABBREV

  ABVM - Automated Best Value Model
  BIFMA - Business and Institutional Furniture Manufacturers
     Association
  BOP - Bureau of Prisons
  CAG - customer advisory group
  CAL - contractor alert list
  CECOMLRC - U.S.  Army Communications-Electronics Command's
     Logistics and Readiness Center
  COED - Customer Order Entry Database
  DAC - design advisory council
  DLA - Defense Logistics Agency
  DOD - Department of Defense
  DOJ - Department of Justice
  FAR - Federal Acquisition Regulation
  FASA - Federal Acquisition Streamlining Act
  FPI - Federal Prison Industries
  FSS - Federal Supply Service
  GPRA - Government Performance and Results Act
  GSA - General Services Administration
  HHS - Department of Health and Human Services
  NEMA - National Electrical Manufacturers Association
  NIH - National Institutes of Health
  NPR - National Performance Review
  OFPP - Office of Federal Procurement Policy
  PBS - Public Buildings Service
  SSA - Social Security Administration
  VA - Department of Veterans Affairs

Letter
=============================================================== LETTER


B-278287

March 16, 1998

The Honorable Peter Hoekstra
The Honorable Mac Collins
The Honorable Roscoe G.  Bartlett
The Honorable Nathan Deal
House of Representatives

This report responds to your July 8, 1997, request for information on
whether Federal Prison Industries (FPI) collects and maintains data
that would enable it to make reliable, generalizable statements about
the satisfaction of its federal agency customers with respect to the
quality, cost, and timely delivery of FPI's products.  Specifically,
you wanted us to determine (1) if FPI has data, either from its
management information systems or other sources, to support overall
conclusions about how federal customers who buy and use its products
and services view their timeliness, price, and quality; and (2)
whether agencies that are among the largest buyers of FPI products
and services monitor FPI's performance the same way they do
commercial vendors in terms of timeliness, price, and quality. 
Federal agencies are generally required to buy FPI products, but not
services, because under 18 U.S.C.  4124 FPI is a mandatory source
supplier. 

You requested this review to determine if FPI had data to support
statements made by its senior management officials at congressional
hearings and elsewhere regarding federal agency customers' high level
of satisfaction with FPI's products and performance, given that some
private sector and federal government personnel made sharply contrary
statements.  You also wanted to determine whether FPI's statutory
status as a mandatory supplier to the government caused federal
agencies to develop and use past performance information about FPI
differently from how the agencies used information about private
sector government contractors. 

To meet these objectives, we interviewed FPI officials and gathered
information on their customer satisfaction efforts at FPI in
Washington, D.C.  We also met with officials at FPI's Customer
Service Center in Lexington, KY and the Office of Federal Procurement
Policy (OFPP); and spoke with officials at five of FPI's major
customer agencies--the Defense Logistics Agency (DLA); the General
Services Administration's (GSA) Federal Supply Service (FSS) in
Arlington, VA, and Fort Worth, TX; the Department of the Army's
Office of the Assistant Secretary of the Army for Research,
Development, and Acquisition in Falls Church, VA; the Social Security
Administration (SSA) in Baltimore, MD; and the United States Postal
Service (the Postal Service) in Washington, D.C.  In addition, we
reviewed key laws and regulations, such as the Federal Acquisition
Regulation (FAR) pertaining to procurement from commercial vendors
and FPI, especially in relation to vendor performance.  We also
reviewed selected literature on customer satisfaction and compiled
information on selected private and public sector organizations'
efforts to gather and use customer satisfaction information.  We did
not assess FPI's overall efforts to promote customer satisfaction,
such as resolving complaints; nor did we assess customer agencies'
efforts to award and administer vendors' contracts. 

We did our work between July 1997 and January 1998 in accordance with
generally accepted government auditing standards.  Appendix I
provides a detailed discussion of our objectives, scope, and
methodology.  We requested comments on a draft of this report from
the Director, Bureau of Prisons (BOP).  These comments are discussed
near the end of this letter and are reprinted in appendix II.  We
also held exit conferences with program officials of the other
federal agencies to verify applicable data and facts presented in the
report. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

FPI has been the subject of substantial debate over the years, much
of which has centered on the timeliness, price, and quality of its
products.  Missing from this debate have been convincing data that
show whether federal customers who buy and use FPI products and
services are satisfied with FPI's performance.  Although FPI says
that it is committed to delivering total customer satisfaction, it
lacks sufficient data that would allow it to make overall conclusions
about whether federal customers are satisfied. 

FPI has a variety of management information systems that, among other
things, allow it to track customer orders and react to complaints. 
However, FPI does not have a systematic or structured process for
collecting and analyzing customer satisfaction data so that
conclusions can be drawn about customer satisfaction.  FPI's efforts
to gauge customer satisfaction have been limited to relying on
narrowly scoped customer surveys as well as other efforts, such as
customer advisory group sessions and trade shows held once or twice a
year to obtain, among other things, feedback from customers.  Our
work showed that although these efforts may provide FPI with some
insights about a particular problem, data are not systematically
compiled and used to improve performance and are insufficient for
supporting overall conclusions about whether federal customers are
satisfied. 

Without convincing data on customer satisfaction, FPI (1) remains
vulnerable to assertions by its critics that federal customers are
dissatisfied and, in turn, should no longer be required to buy FPI
products; and (2) may miss opportunities to improve its operations by
having better data on how federal customers view its performance in
the areas of timeliness, price, and quality.  Furthermore, FPI's lack
of a systematic approach for collecting these data appears
inconsistent with contemporary management principles used by both
public and private sector organizations.  These principles focus on
reaching out to customers to improve performance, accountability, and
results, as well as using customer satisfaction as a measure of
organizational performance.  Some organizations, such as the Postal
Service, systematically collect customer satisfaction data to measure
and improve performance. 

Regarding agencies' efforts to monitor FPI performance, major
customer agencies that we contacted--DLA, FSS, Army, SSA, and the
Postal Service--said that they consider price when awarding contracts
and monitor factors like quality and timeliness while administering
contracts for all vendors, including FPI.  As part of this process,
the agencies said they also scored or rated the overall performance
of many of their commercial vendors while administering contracts. 
In addition, DLA, FSS, and the Postal Service also developed
performance ratings of FPI.  According to agency procurement
officials, regardless of the type of vendor, contracting officers
have discretion when considering timeliness, price, or quality while
awarding or administering a contract. 

It should be recognized, however, that the contracting officer's
leverage in resolving procurement problems is different for FPI from
the leverage the contracting officer has for private sector vendors
since the rules that typically govern contracts with private sector
vendors do not apply to FPI.  In this regard, on September 13, 1993,
the Acting Attorney General issued a legal opinion that held that
FPI, as a seller of goods to the federal government, is not covered
by the FAR and must be treated under its authorizing legislation and
FAR Subpart 8.6.  When agencies do develop varying types of
information on current and past performance of vendors, including
FPI, there are major distinctions in how agencies can use this
information.  For example, in the case of a commercial vendor, all
five agencies can use current performance information to terminate a
contract for deficient performance and can use past performance
information as a factor to consider in the award of contracts.  In
the case of FPI, with the exception of the Postal Service, agencies
cannot use current performance information to cancel or terminate a
contract with FPI unless agencies request cancellation or termination
provisions during the negotiation process and FPI agrees to include
them in the contract.  According to FPI, agencies can, however, use
current performance information to seek other remedies against FPI,
such as fulfillment of lifetime warranties or damages for late
delivery.  We did not determine the extent to which agencies seek, or
FPI agrees to authorize, these remedies; nor did we compare or
evaluate the use of remedies by contracting officers in connection
with contracts with FPI or commercial vendors. 

Furthermore, agencies cannot use past performance information to deny
awarding a contract to FPI because, under the law, FPI is a mandatory
source of supply.  However, at FPI's discretion, agencies can use it
to negotiate with FPI on factors such as product quality or delivery
time frames, or to seek a waiver from FPI so that they can buy from a
commercial vendor that can better meet their quality or delivery
requirements.  Under 18 U.S.C.  4124 (b) disputes regarding "price,
quality, character, or suitability" of products furnished by FPI are
subject to resolution by a high-level arbitration board made up of
the Attorney General, the Administrator of the General Services, and
the President, or their representatives.  The Postal Service, which
is exempted from most federal laws dealing with public or federal
contracts, is not required to buy FPI products and can treat FPI like
a commercial vendor. 


   BACKGROUND
------------------------------------------------------------ Letter :2

FPI is a wholly owned government corporation managed by the
Department of Justice's (DOJ) Bureau of Prisons (BOP).  FPI was
created by Congress in 1934 and serves as a means for managing,
training, and rehabilitating inmates.  Under the trade name UNICOR,
FPI markets about 150 types of products and services to federal
agencies.  Products include furniture, textiles, and electronic
components.  Services include data entry, engine repair, and
furniture refinishing.  In fiscal years 1995 and 1996, FPI had net
sales of about $459 million and $496 million, respectively, in
products and services.  In addition to buying products directly from
FPI, agencies buy FPI products from central supply agencies like FSS
or, in the case of the military, from DLA.  FSS and DLA stock some
FPI products for sale to customers; FPI delivers other products
directly to customers when orders are placed with FSS or DLA. 
According to FPI officials, agencies generally deal directly with FPI
when procuring services. 

The FAR generally governs all acquisitions by executive agencies and
codifies policies and procedures for the federal acquisition
system.\1 This system is designed to satisfy the customer in terms of
timeliness, price, and quality by (1) maximizing the use of
commercial products and services, (2) using contractors who have a
track record of successful past performance or who demonstrate a
current superior ability to perform, and (3) promoting competition. 
The federal acquisition system is also designed to minimize
administrative operating costs; conduct business with integrity,
fairness, and openness; and fulfill public policy objectives. 

As the primary document for the federal acquisition system, the FAR
sets forth the basic policies and procedures for making acquisition
decisions and administering contracts.  For example, Part 9 of the
FAR outlines procedures for determining a prospective contractor's
ability to responsibly provide products and services that meet
specifications in a timely fashion.  Part 15 deals with contracting
by negotiation, including solicitation, source selection, and price
negotiations with prospective contractors; and, among other things,
it outlines evaluation factors that should be used during the
selection process.  In addition, Part 42 outlines policies and
procedures for administering contracts.  More specifically, Subpart
42.15 (1) establishes agency responsibilities for collecting and
maintaining contractor performance data and (2) states that past
performance information regarding a contractor's actions under
previously awarded contracts is relevant for future source selection
purposes. 

To attain certain public policy objectives, there are exceptions to
the full and open competition requirement of the federal acquisition
system.  One of these exceptions is FAR Subpart 8.6 pertaining to
acquisitions from FPI.\2 FAR Subpart 8.6 implements the law setting
forth FPI's status as a mandatory supplier, which means that federal
agencies are generally required to purchase FPI products if they meet
the buying agency's requirements and the prices charged do not exceed
current market prices.\3 If FPI cannot meet the buying agencies'
requirements, the FAR allows agencies to seek a waiver from FPI.\4
FPI's mandatory source status for products does not apply to the
services that it offers to its federal customers. 


--------------------
\1 The federal acquisition system consists of the FAR and agency
acquisition regulations that implement or supplement the FAR. 

\2 Other laws provide exceptions to the full and open competition
requirements under the Competition in Contracting Act (41 U.S.C. 
253), which is implemented by the federal acquisition system.  For
example, the Javits-Wagner-O'Day Act (41 U.S.C.  46-48(c)) provides
an exception for acquisitions from qualified nonprofit agencies
employing the blind or severely disabled.  These nonprofit agencies
are also a mandatory source of supply.  In addition, Section 8(a) of
the Small Business Act (15 U.S.C.  637) provides an exception for
acquisitions through SBA with small disadvantaged business concerns. 

\3 See 18 U.S.C.  4124. 

\4 Because FPI is a mandatory source provider for items it produces,
FPI's customers are required to obtain FPI's written authorization
for clearance prior to placing an order for a similar item through
outside sources.  Federal agency customers can request a waiver by
mail, electronically, or by facsimile.  The waiver request asks the
customer to justify that the FPI product does not meet the basic
needs of the agency.  Each request is evaluated on a case-by-case
basis by FPI sales consultants, but systems furniture waivers are
handled by FPI's systems project group.  Waivers that are denied can
be appealed to the FPI ombudsman in Washington, D.C. 


      CONTINUING DEBATE OVER
      CUSTOMER SATISFACTION WITH
      FPI PRODUCTS
---------------------------------------------------------- Letter :2.1

Over the years, supporters and critics of FPI have debated FPI's
mandatory source status and whether FPI provides quality goods, at a
reasonable price, and on a timely basis.  Both sides recognize that
FPI has a social objective to manage, train, and rehabilitate inmates
through work programs.  However, some critics continue to question,
among other things, whether the products and services associated with
FPI's work programs satisfy federal customers in terms of timeliness,
price, and quality and whether FPI's mandatory source status results
in unfair competition with the private sector. 

In the early 1990s, the Senate and House Committees on Small Business
held hearings on the effect of FPI on small business during which
FPI, non-FPI vendors, and Members of Congress debated FPI's mandatory
source status and the impact of FPI on various markets.  One of the
issues that arose during this debate centered on the timeliness,
price, and quality of FPI's products and services.  In particular,
many of the non-FPI vendors and some Members questioned whether
federal customers as well as the agencies they worked for, in
general, were satisfied with the timeliness, price, and quality of
FPI products and services.  More recently the Vice President's
September 1993 National Performance Review (NPR) report recommended,
among other things, the elimination of FPI's mandatory source status
in the face of agencies' concerns about FPI product price and
timeliness problems.  NPR stated that: 

     "The Federal Prison Industries' (FPI) mandatory source allows
     FPI to counter the dangerous effects of inmate idleness and to
     prepare prisoners for reintegration into society especially
     considering the rapid growth of the Federal prison inmate
     population.  However, Federal agency dissatisfaction with the
     quality of FPI's services requires significant and immediate
     improvements in product delivery, and ultimately FPI should have
     to compete more like a private supplier."\5

NPR went on to say that:  "Agencies have indicated that promised
delivery timeframes from FPI are already too long and generally
unreliable.  Agencies also confirm that other sources can provide
equal or better products for less cost."\6 To date, NPR's
recommendation related to FPI's mandatory source status has not been
implemented.  The Justice Department favors maintaining FPI's
mandatory source status. 

In June 1997, Government Executive published an article that, among
other things, discussed the questions raised by some agency and
military officials about the timeliness, price, and quality of FPI
products.\7 In one instance, the article cited a statement to the
House Committee on National Security from a Navy Master Chief Petty
Officer who stated that FPI's "product is inferior, costs more and
takes longer to procure.  UNICOR has, in my opinion, exploited their
special status instead of making changes which would make them more
efficient." In the same article, the Deputy Commander of DLA's
Defense Personnel and Support Center, who wrote a letter of complaint
about FPI to a Congressman in May 1996, was cited as saying that
FPI's prices were higher than commercial companies' prices by an
average of 13 percent and "there is no practicable way to terminate a
contract or recoup monies that would normally be owed by a commercial
firm."

FPI and its proponents have acknowledged that there may have been
problems with some FPI products in the past but claim it has made
efforts to improve its products and delivery performance.  In
discussing FPI improvements, the Government Executive article cited
the Deputy Commander of the Army's Family Support Center as stating
that FPI is "as reliable as any other vendor, and their prices are
comparable or cheaper." Likewise, with regard to changes in the
quality and timeliness of FPI products, the article quoted a Navy
contracting officer as stating that the change "has been something
akin to the transformation of the ugly duckling into the beautiful
swan."

For its part, FPI maintains a folder of letters from contracting
officials in military and civilian agencies that commend FPI and
describe their experiences in dealing with it.  FPI officials also
provided copies of letters from FPI customers to NPR that cited FPI
for its improved service and willingness to work with agency
officials in delivering products and services.  For example, in a
letter to the Senior Policy Advisor to the President, the Commander
of the Air Force's 30th Contracting Squadron wrote:  "In recent
years, I have seen what I would term 'tremendous efficiency
improvements' in the areas of delivery and customer service."
Likewise, an Army contracting officer from the Aviation and Troop
Command said that: 

     "In my opinion, UNICOR has become more business oriented within
     the last couple of years.  Products have been modernized to
     compete with the open market.  Delivery has improved
     tremendously, to include a discount if the date is slipped. 
     Services and the ease of doing business with UNICOR .  .  .  has
     far exceeded our expectations."

In another letter, the Acquisition Chief of the Department of
Veterans Affairs' Medical Center in Dallas wrote that FPI had taken
actions to improve things like responsiveness and customer service
and many, but not all, issues had been resolved.  For example, the VA
official stated that delivery performance had been a problem, but FPI
had taken steps to improve its timeliness.  In addition, he wrote
that prices of some items, such as furniture, had become competitive,
but some items, such as sheets, were still "overpriced." In terms of
quality, the VA official said that "UNICOR chairs used to routinely
break soon after they were put into service [and] case goods such as
desks routinely had Formica peeling off the edges" and added that FPI
"now makes a very durable chair line and case goods that still look
good even after many years of service." The same official praised
FPI's increasing emphasis on customer service and said that "To truly
finish the `remake' of UNICOR that has begun .  .  .  UNICOR should
become nonmandatory." The official added that such a step would force
FPI to become competitive in all areas, not just in some areas. 

According to FPI, it has implemented several initiatives to improve
customer responsiveness.  For instance, during fiscal year 1996,
FPI's annual report stated that FPI had initiated a lifetime
guarantee on products and services, opened a web site to advertise
its products, and begun accepting orders via the Internet.  The
annual report also stated that, among other things, FPI reduced its
average processing time on waiver requests to less than 4 days,
incorporated liquidated damages clauses into contracts, and initiated
automatic discounts for late delivery.  FPI's annual report did not
discuss, nor did we assess, the implementation or effectiveness of
these stated initiatives. 


--------------------
\5 Reinventing Support Services, Accompanying Report of the National
Performance Review, Office of the Vice President, September 1993. 

\6 Ibid. 

\7 Jeff Erlich, "Competing With Convicts," Government Executive, June
1997. 


   FPI LACKS SYSTEMATIC DATA ON
   CUSTOMER SATISFACTION
------------------------------------------------------------ Letter :3

FPI states that it is committed to delivering total customer
satisfaction and has been satisfying federal customers since 1934. 
However, it lacks sufficient data to support any overall conclusions
about whether federal customers who buy and use its products and
services are satisfied with their timeliness, price, and quality. 
FPI's management systems are not designed to systematically collect
and analyze federal customers' views about its products and services. 
Further, its efforts to gauge customer satisfaction have been limited
and do not allow for measurement of, or overall conclusions about,
customers' views on its products and services.  Over the last several
years, public and private organizations have recognized the merits of
systematically obtaining and using customer satisfaction data to
improve performance and adopting customer satisfaction as a
performance measure.  In the absence of such data and a related
performance measure, FPI is unable to demonstrate with any degree of
certainty the level of customer satisfaction it delivers. 
Furthermore, it (1) remains vulnerable to assertions by its critics
that federal customers are dissatisfied and, in turn, should no
longer be required to buy FPI products; and (2) possibly misses
opportunities to improve its operations by having better data on how
federal customers view its performance. 


      FPI DATA SYSTEMS NOT
      DESIGNED TO TRACK CUSTOMER
      SATISFACTION
---------------------------------------------------------- Letter :3.1

FPI has a variety of management information systems that, among other
things, allow it to track customer orders and react to complaints. 
However, these systems are not designed to systematically obtain
feedback on timeliness, price, and quality from federal customers. 
FPI's Manager of Information Systems told us that FPI does not have a
management information system that tracks customer satisfaction. 
According to this official, FPI's complaint system comes the closest
to measuring customer satisfaction.  This system records and tracks
individual complaints from customers for problems such as missing or
loose parts, quality defects, or missed delivery dates. 

In addition to the complaints system, we noted that FPI has a system
that is used to record and track agency requests for waivers or
clearances.  As mentioned earlier, the FAR requires that a federal
agency obtain a waiver from FPI before the agency can buy similar
items from sources in the commercial market.  FPI has established the
procedures for requesting waivers, and cognizant FPI personnel
initially consider the waiver request.  If the waiver request is
denied, the agency's next recourse is an appeal to the FPI ombudsman. 
According to FPI, its waiver system, which we did not assess, records
various data, including the name of the requester; the date of the
request; a description of the item(s); the quantity, unit, and total
price of the item(s); whether the waiver was granted or denied; and
whether or not that decision was appealed.  The database also
categorizes reasons customers' waiver requests were granted--such as
FPI being unable to meet the price range, deliver within required
time frames, or meet technical specifications or requirements; or
denied--such as prices are consistent with those of similar products
offered through alternative procurement sources, FPI offers
comparable items that will meet required specifications, or not
enough information has been provided. 

It is important to note that although the complaint and waiver data
touch on issues related to timeliness, price, and quality, using
complaint and waiver data as measures of customer satisfaction has
major limitations.  First, FPI would have to know whether its federal
customers are fully aware of the complaint and waiver processes. 
Second, FPI's federal customers would need to use them in a
reasonably uniform manner.  That is, FPI would have to be sure that
federal customers who are dissatisfied actually follow through by
registering a complaint.  In this regard, it has been generally
recognized in the business community that dissatisfied customers
often do not file complaints.  Further, FPI would need to be sure
that contracting officers always seek a waiver when they believe FPI
cannot meet their price or delivery time frames--we are not aware of
any evidence that would suggest whether they do or do not.  Finally,
the complaint and waiver processes are not designed to allow federal
customers to provide FPI with constructive feedback--information that
it could use to make improvements and help support conclusions about
federal customers' satisfaction. 

Although FPI's systems are not designed to systematically obtain
feedback from federal customers, early in our work it appeared to us
that data from FPI's customer order entry database (COED) could
possibly be used as a vehicle for obtaining federal customers' views. 
The COED system, housed at FPI's Customer Service Center in
Lexington, KY, is used to track agency orders and to provide
customers with information on the status of their orders.  We
explored the possibility of conducting a generalizable survey of FPI
customers using data from COED.  However, we discovered that the COED
data in its current form were insufficient for this purpose and that
we would have to identify customers for a survey on a case-by-case
basis using hard copy orders from the agencies.  Even after examining
some of the hard copy orders, we often could not definitively
determine the names and addresses of individuals in federal agencies
associated with the orders, such as the procurement officers who
signed them.  In addition, data on end users, or individuals
knowledgeable of end users' satisfaction with the products--potential
respondents for the quality dimension of a survey--were generally not
available in COED or identified in the product orders. 

FPI officials acknowledged that information in COED in its current
form is not sufficient to use to identify federal customers who are
the buyers and users of its products and services.  They said that
identifying and maintaining data on the end users of products would
be difficult for any organization selling to the government.  Also,
they said that end users typically do not deal directly with FPI or
other suppliers; others in the procurement process often purchase and
provide end users with the products they use.  Accordingly, FPI
believes that identifying end users would require cooperation from
customer agencies, who would have to devote time and resources to
such an effort and may view it as overly burdensome.  Nonetheless,
the Office of Federal Procurement Policy (OFPP) has started to
encourage agency contracting officers and program officials to
measure end user customer satisfaction when considering the
performance of their vendors.  Furthermore, the FAR recognizes the
benefits of obtaining end user input on the performance of vendors in
providing products and services.  Thus, regardless of the difficulty
of measuring the views of end users, there is growing recognition of
the importance of obtaining customer feedback as part of good
business practices. 

During our review, we noted that FPI compiles various data from the
customer order entry system, as well as other systems, to monitor and
improve performance.  FPI tracks operational information by product
line on such factors as sales and earnings, inventories, inmate
staffing, complaints, and order delinquencies for all of its
production facilities or factories.  According to FPI, it uses these
indicators to routinely evaluate its performance on a real-time,
week-to-week, year-to-year, and factory-by-factory basis.  However,
none of these indicators provide conclusive insights into customer
satisfaction.  Given the limitations associated with using complaints
as a measure of customer satisfaction and the fact that FPI's data
systems are not designed to track customers' views, FPI is not in as
good a position to monitor customer satisfaction as it is with other
important indicators, such as sales. 


      FPI'S EFFORTS TO COLLECT
      CUSTOMER SATISFACTION
      INFORMATION HAVE BEEN
      LIMITED
---------------------------------------------------------- Letter :3.2

Over the years, FPI has relied on a variety of initiatives--at both
the headquarters and factory levels--to obtain limited feedback from
federal customers in general about its products and services.  These
initiatives have involved meeting with top officials from FPI's major
customer agencies, conducting limited surveys of federal customers,
and discussing problems with representatives of federal agencies at
trade shows and advisory group sessions.  These efforts have given
FPI some insights into how these federal customers may view a
specific product or operational process.  However, the results have
been too limited to reliably support broad generalizations regarding
whether federal customers who buy and use FPI products and services
are satisfied overall with FPI's performance.  FPI officials
acknowledged that their efforts to date have not yielded this type of
information and that such information would give them valuable
insights and help them improve their performance. 

FPI officials told us that FPI has conducted some limited customer
satisfaction surveys and has other efforts planned or under way to
obtain information on customer satisfaction.  FPI provided us with
the results from four surveys of selected customers that resulted
from a 1996 customer satisfaction survey plan it had developed. 
These four surveys obtained customer views on FPI's product catalog,
the 800-number service used to facilitate customer orders, trade
shows, and the Allenwood line of FPI furniture.  Only the furniture
survey, however, directly addressed issues related to the timeliness
and quality of products produced by FPI, and this survey was limited
in that it focused on selected furniture from one factory sold over a
4-month period.  In addition, for the furniture survey FPI received
only 42 responses out of 400 surveys that it sent--a response rate
far too low to support any conclusions.  FPI officials said that at
the time of our review, they could not find documentation on any
other survey efforts.  Furthermore, they told us that the individual
responsible for developing the 1996 survey plan and its accompanying
survey efforts had since retired. 

FPI also has organized a customer advisory group (CAG) and a design
advisory council (DAC), which are made up of representatives from
selected customer agencies and were formed so that FPI could get
feedback from agencies about its products, services, and overall
operations.  The CAG is typically made up of contracting officers or
other personnel from military and civilian agencies who have some
direct involvement in procuring products or services from FPI. 
According to FPI officials, the group members, who serve at the
invitation of FPI, are to solicit input on problems with FPI from
other personnel in their agencies to develop a broad understanding of
the problems experienced agencywide.  FPI brings as many members as
possible together once or twice a year, depending on the availability
of funds, to discuss problems, suggest solutions, and review what FPI
has done to resolve past problems.  The DAC, made up of federal
designers who configure and furnish agencies' workspace, meets
periodically and works with FPI to ensure that its products meet
their needs and are compatible with commercially available products
that are being used. 

According to FPI's Director of Sales, Marketing, and Customer
Service, individual prison factories have undertaken some efforts to
assess customer satisfaction, but such efforts are not monitored by
headquarters staff.  At our request, he queried 54 locations with 88
factories that had customers in other federal agencies.  Of the 54
locations, 33 responded that they make some effort to contact the
customer and discuss customer satisfaction.  The most common effort,
which 25 factories reported doing, was unstructured telephone calls
to some customers to either follow up on a complaint or generally
inquire into customer satisfaction.  Eight locations said they use
customer satisfaction surveys or guarantee forms with space to
address customer satisfaction that they send to some or all of their
customers.  For example, the furniture factory in the Tallahassee
Federal Correctional Institution had a customer satisfaction rating
line on some of its guarantee forms.  Based on the size of the order,
a number of these are included in the orders, and the customer is
asked to fax or mail the rating back to the factory.  According to
the factory staff, the responses have generally been positive; but
response rates have been low, and steps are being taken to improve
them. 

Despite these efforts, the Director of Sales, Marketing, and Customer
Satisfaction told us that none of the efforts reported by any of the
prisons yielded generalizable results.  That is, they did not use
valid sampling techniques and did not garner meaningful response
rates.  Likewise, he said that the results of these efforts are not
systematically compiled and cannot be used to make any overall
conclusions concerning customer satisfaction with any product or
factory, or about FPI in general.  He further told us that he is not
satisfied with FPI's progress in developing a more systematic
approach to collecting customer satisfaction data.  He attributed
this delay to an FPI reorganization and the turnover among
individuals responsible for developing improved approaches for
collecting and analyzing customer satisfaction data.  He said that
FPI recognizes the importance of developing customer satisfaction
data and is becoming more active in this area.  For example, he said
that a full-time staff member is now assigned to developing
questionnaires in house and working with him to develop an overall
strategy to measure customer satisfaction.  He envisions hiring a
private sector consultant to assist in FPI's development of an
overall strategy for systematically obtaining customers' views. 

In addition, another unit within FPI, the Planning, Research, and
Activation Branch, is working with DOD to develop a detailed survey
instrument to begin to compile some customer satisfaction data at the
Department of Defense (DOD).  Under the National Defense
Authorization Act for Fiscal Year 1998, FPI and DOD are mandated to
conduct a joint study of procurement procedures, regulations, and
statutes that govern transactions between DOD and FPI.  As part of
this study, FPI and DOD have developed a draft survey instrument that
would ask DOD customers to respond to questions about the procurement
process, including their rating of products like electronics, office
furniture, and signs, on a scale of 1 (unsatisfactory) to 5
(exceptional) with regard to price, quality, delivery, and service. 
Among other things, the survey would also ask respondents to rate FPI
as a supplier, provide information on their experiences requesting
and securing waivers, and provide feedback on whether respondents
would use FPI if it were not a mandatory source.  According to an FPI
industrial specialist with the Planning, Research, and Activation
Branch, current plans are to hire a private company to administer the
survey telephonically to FPI's DOD customers who purchased FPI
products valued at $10,000 or more over the last 3 years.  The same
official was not sure if the survey would obtain the views of end
users.  She said that FPI has plans to have the survey completed by
the end of February so the results can be incorporated into the joint
FPI/DOD report to Congress, which is due in May 1998. 


      IMPORTANCE OF CUSTOMER
      SATISFACTION DATA REFLECTED
      IN CONTEMPORARY THINKING ON
      ORGANIZATIONAL EXCELLENCE
---------------------------------------------------------- Letter :3.3

FPI's lack of sufficient information about customer satisfaction
appears inconsistent with contemporary thinking on the importance of
collecting and using such information to improve performance. 
Proponents of collecting and using customer satisfaction data have
emphasized the need to measure performance by systematically
collecting customer satisfaction data and to identify and address
real and perceived organizational and performance problems.  Criteria
for awards in organizational excellence, such as the Malcolm Baldrige
National Quality Award and the President's Quality Award, stress the
importance of obtaining customers' views.  Recent initiatives such as
NPR and the Government Performance and Results Act of 1993 (known as
GPRA or the Results Act) have focused on performance measurement.  In
particular, NPR has stressed the importance of promoting customer
satisfaction in government and accountability to customers through
feedback systems and performance measurement. 

Contemporary management experts have stressed the importance of
improving the quality of products and services, listening to the
needs of customers, and meeting those needs.  These factors,
according to experts, are essential for success in both the private
and public sectors.  For example, W.  Edwards Deming stressed that
the quality of goods and services should aim to meet the needs of the
customer, and customer needs and wishes have to be understood.\8 Tom
Peters has advocated that one of the five essentials of
organizational performance is an obsession with responsiveness to
customers.\9 David Osborne and Ted Gaebler have stated that there is
no reason public organizations cannot get close to their customers
and listen to their needs just as private organizations do.\10
Osborne and Gaebler have likewise stated that customer-driven
organizations are more accountable to their customers because they
solicit and respond to feedback on customer needs. 

Criteria published for measuring organizational excellence in both
the private and public sectors include collecting customer
satisfaction information and using results to improve performance. 
For example, for the private sector's Malcolm Baldrige National
Quality Award and the executive branch's President's Quality Award,
organizations are expected to (1) follow up with their customers
regarding recent purchases of products and services to gauge
satisfaction and resolve problems; and (2) include measures of
customer satisfaction with their financial and other measures to
improve operational results.\11

It is important to note that these and other criteria do not call for
a "cookbook" approach to collecting customer satisfaction data. 
Although the criteria mention a variety of approaches, such as
surveys, focus groups, and interviews, they generally advocate
leaving the specific choice of approaches or combination of
approaches up to each organization.  This flexibility recognizes that
organizations of different types or sizes or organizations, such as
FPI, that market an array of different products and services may use
various approaches or a combination of approaches for different
customers.  Regardless of the choice of methods selected, however,
the criteria do call for a convincing and systematic way to measure
and report on customer satisfaction. 

In recent years, the federal government has placed increased emphasis
on customer service and has begun an initiative to become more
businesslike by using performance information to measure results. 
The September 1993 NPR report stressed, among other things, the need
for the federal government to emphasize customer satisfaction. 
Shortly thereafter, the President signed Executive Order 12862, which
established and implemented customer service standards to guide the
operations of the executive branch.  The order called for executive
departments and agencies that provide significant services to the
public to take a number of actions.  These actions include
identifying and surveying customers, posting service standards and
measuring results against them, and benchmarking customer service
performance against the best in the business. 

Although the order is directed toward agencies that serve the public,
FPI's Chief Operating Officer told us that FPI has made a voluntary
commitment to be in full compliance with the executive order.  In
response to the order, FPI developed a special report for the NPR
Customer Service Team that acknowledged the importance of satisfied
customers to UNICOR and also recognized the importance of customer
surveys.  The paper stated that within the competitive environment in
which FPI operates, "it is critical, more than ever before, that
UNICOR understand and `know' its customers." The paper critiqued
FPI's past efforts in using surveys and pointed out some potential
design and response problems with those surveys.  It also discussed
FPI's strategy for responding to the Executive Order, which included
expanding customer contact sessions as well as conducting more and
broader written and telephone surveys.  FPI's paper also defined its
direct customer base--federal contracting officers, procurement
personnel, and all federal employees who are end users of FPI
products and services--and indicated that telephone-based surveys
should consider measuring end users' satisfaction with FPI products. 
In addition, in October 1995, NPR published FPI's customer service
standards that, among other things, committed FPI to surveying its
customers annually.\12 According to FPI's Director of Sales,
Marketing, and Customer Service and the Executive Assistant to the
Chief Operating Officer, this commitment waned due to a
reorganization, resource shortages, and other operational priorities. 
However, as discussed earlier, the Director of Sales, Marketing, and
Customer Service said that FPI has recently taken steps to renew its
commitment, including assigning a full time staff member to develop
questionnaires and work on customer satisfaction issues.  In fact,
NPR's 1997 report on customer service standards restates FPI's
commitment to doing customer satisfaction surveys.\13

The Results Act requires agencies to set goals, measure performance,
and report on the degree to which their goals are met.  As a starting
point, the act requires agencies to develop multiyear strategic
plans, the first of which were to be submitted to Congress by
September 30, 1997, that include the agency's mission statement,
general goals and objectives, and the strategies the agencies plan to
use to achieve these goals and objectives.  Although the Results Act
does not require FPI to have its own strategic plan, the DOJ plan
does have goals and objectives that relate to FPI.  For example,
under the Detention and Incarceration section of the Justice plan,
one goal relates to the overall mission of BOP and includes a broad
reference to FPI's principal function--"Provide productive work,
education, medical, and other programs to meet inmate needs and
facilitate their successful reintegration into society, consistent
with community expectations and standards." In the Management section
of the DOJ plan, another goal pertains to DOJ operations in general
but seems especially pertinent to FPI and its operations--that is,
the goal to "Meet or exceed the expectations of our customers." Thus,
if satisfying customers were to be one of FPI's major goals, it seems
that FPI would want reliable customer satisfaction data so that it
could determine the extent to which it was meeting its goal. 


--------------------
\8 W.  Edwards Deming, Out of the Crisis (Cambridge, MA;
Massachusetts Institute of Technology, Center for Advanced
Engineering Study, 1986), pp.  5 and 175. 

\9 Tom Peters, Thriving on Chaos (New York:  Harper and Row
Publishers, Inc., 1987), p.  45. 

\10 David Osborne and Ted Gaebler, Reinventing Government:  How the
Entrepreneurial Spirit Is Transforming the Public Sector (Reading,
MA:  Addison-Wesley Publishing Company, 1992), pp.  169-170. 

\11 See, for example, Malcolm Baldrige National Quality Award:  1997
Criteria for Performance Excellence; and 1998 Application and
Information:  The President's Quality Award Program. 

\12 Putting Customers First '95:  Standards for Serving the American
People, National Performance Review, October 1995. 

\13 Putting Customers First '97:  Standards for Serving the American
People, National Performance Review, Oct.  1997. 


      SOME PUBLIC AND PRIVATE
      ORGANIZATIONS OBTAIN
      CUSTOMER SATISFACTION DATA
---------------------------------------------------------- Letter :3.4

During our review, we found several examples of public and private
organizations that have developed approaches to actively obtain and
use customer satisfaction data.  The U.S.  Army
Communications-Electronics Command's Logistics and Readiness Center
(CECOM LRC) received the President's Quality Improvement Prototype
Award for developing an approach for, among other things,
systematically determining and measuring customer satisfaction.\14
The Postal Service systematically uses customer satisfaction data to
develop internal and external measures of its performance; identify
problem areas; and identify corrective actions, where necessary. 
Likewise, two GSA components, the Public Buildings Service (PBS) and
the Office of Property Disposal, have begun to use customer surveys
to monitor and improve their performance.  In addition, according to
officials at two trade associations that have members who sell
products similar to FPI's, the National Electrical Manufacturers
Association (NEMA) and the Business and Institutional Furniture
Manufacturers Association (BIFMA), some of their progressive members
regularly track customer satisfaction. 

Our review of a series of case studies developed for the President's
Quality Award Program showed that CECOM LRC, for example, has used
surveys, performance data, and other information to develop a
customer satisfaction index to measure and improve its performance. 
According to one of the case studies, CECOM LRC supplies the Army
with communications and electronics systems as well as logistics
support, engineering, and inventory management.  It has, as one of
its six strategic goals, a goal to continually demonstrate a
commitment to internal and external customers, which include end
users such as soldiers as well as project managers, depots, and
foreign governments.  In 1993, CECOM LRC realized that it needed to
develop a more systematic approach to measuring customer
satisfaction.  Until that time, each of its eight directorates
administered its own external survey to measure customer
satisfaction, but feedback was not consolidated to gauge how well the
organization was satisfying customers. 

CECOM LRC concluded that surveys alone were not sufficient to
accurately measure satisfaction and decided on an approach that
aggregated various sources of information.  It benchmarked with IBM
and Texas Instruments to examine how large private sector
organizations measured customer satisfaction.  In 1994, it created
the Customer Satisfaction Index, a composite measurement system based
on information from mail and telephone surveys; performance
statistics, including measures and trends of formal complaints;
comparison data, including comparisons with similar providers; and
internal perspectives that used workforce self-assessment surveys. 

Similarly, in November 1992 and December 1995, we reported on Postal
Service efforts to measure customer satisfaction.\15 Among other
things, we reported that Postal Service officials recognize that the
Service must do a better job of increasing customer satisfaction by
improving service performance and pointed out that the Service
increasingly was focusing on customer needs, expectations, and
perceptions.  We also discussed the Postal Service's efforts to
collect customer satisfaction data on, for example, timeliness of
delivery; whether its services were a good value for the price; the
helpfulness and courtesy of Postal personnel; and its complaint
handling.  Furthermore, we discussed how the Postal Service
systematically uses these data to develop internal and external
measures of its performance; identify problem areas; and identify
corrective actions, where necessary.  In addition, the Postal Service
Strategic Plan, which was submitted to Congress in September 1997 as
required by the Results Act, discusses how the Postal Service uses
customer satisfaction as one of its key performance measures. 

GSA also has taken some steps to measure customer satisfaction among
some of its components.  For example, according to GSA's 1998 budget
justifications, GSA's PBS uses a survey developed by the Gallup
Organization to evaluate customer service performance against
industry standards and to guide PBS in making enhancements to its
real property management function.  The survey measures the
satisfaction of building occupants with the way GSA cleans, protects,
repairs, heats, and manages buildings.  PBS uses the results to
measure its performance and has a long-term goal of achieving a
satisfaction rating of 85 percent, which according to PBS is
consistent with the private sector standard.  PBS reported that
preliminary survey results in 1996 showed that it had achieved its
interim customer satisfaction rating goal for very large buildings. 
GSA's Office of Property Disposal also uses a private survey firm to
measure customer satisfaction with its programs and services. 
According to GSA's 1998 budget justifications, this office is focused
on providing better quality service with a goal of 95 percent
customer satisfaction.  According to the responses received by the
survey firm, customer satisfaction improved from 78 percent in fiscal
year 1995 to 92 percent in fiscal year 1996. 

In addition, our discussions with officials representing two trade
associations--NEMA and BIFMA--that have members that sell products
similar to FPI indicated that some of their more progressive members
regularly track customer satisfaction.  The BIFMA official told us
that some companies contract with firms that provide customer
satisfaction measurement services.  The same official referred us to
Kennedy Research, which is part of a worldwide business research
firm, Wirthlin Worldwide, that provides opinion research services for
both public and private clients.  The president of Kennedy Research
said that his firm uses customized data collection methods and
analytical techniques to survey a client's current and past
customers, with the focus on developing recommendations that can lead
to improved customer satisfaction. 


--------------------
\14 The Quality Improvement Prototype Award is given annually as part
of the President's Quality Award Program.  The award is given to
federal organizations that have achieved high standards of customer
service and quality.  The process governing the award is comparable
to the Malcolm Baldrige National Quality Award for private sector
companies and consists of application review and site visits to
finalists' organizations to validate the application review. 

\15 U.S.  Postal Service:  Tracking Customer Satisfaction in a
Competitive Environment (GAO/GGD-93-4, Nov.  12, 1992); and U.S. 
Postal Service:  New Focus on Improving Service and Customer
Satisfaction (GAO/GGD-96-30, Dec.  20, 1995). 


   AGENCIES DEVELOP PERFORMANCE
   INFORMATION ON ALL VENDORS BUT
   APPLY IT DIFFERENTLY TO FPI
------------------------------------------------------------ Letter :4

Major customer agencies--DLA, FSS, Army, SSA, and the Postal
Service--consider price when awarding contracts and monitor factors
like quality and timeliness while administering contracts for all
vendors, including FPI.  As part of the process of developing
performance information, all five agencies also scored or rated the
overall performance of many of their commercial vendors while
administering contracts.  In addition, the two major supply
agencies--FSS and DLA--and the Postal Service said that they
developed performance ratings of FPI.  According to agency
procurement officials, regardless of the type of vendor, contracting
officers have discretion when considering timeliness, price, and
quality while awarding or administering contracts. 

It should be recognized, however, that the contracting officer's
leverage in resolving procurement problems is different for FPI from
the leverage the contracting officer has for private sector vendors
since the rules that typically govern contracts with commercial
vendors do not apply to FPI.  In this regard, on September 13, 1993,
the Acting Attorney General issued a legal opinion which held that
FPI, as a seller of goods to the federal government, is not covered
by the FAR, and must be treated under its authorizing legislation and
FAR Subpart 8.6.  When agencies do develop varying types of
information on current and past performance of vendors, including
FPI, there are major distinctions in how agencies can use this
information.  For example, in the case of a commercial vendor, all
five agencies can use current performance information to terminate a
contract for deficient performance and can use past performance
information as a factor to consider in the award of contracts.  In
the case of FPI, with the exception of the Postal Service, agencies
cannot use current performance information to cancel or terminate a
contract with FPI unless agencies request cancellation or termination
provisions during the negotiation process and FPI agrees to include
them in the contract.\16

According to FPI, agencies can, however, use current performance
information to seek other remedies against FPI, such as fulfillment
of lifetime warranties or damages for late delivery.  We did not
determine the extent to which agencies seek, or FPI agrees to
authorize, these remedies; nor did we compare or evaluate the use of
remedies by contracting officers in connection with contracts with
FPI or commercial vendors. 

Furthermore, agencies cannot use past performance information to deny
awarding a contract to FPI because, under the law, FPI is a mandatory
source of supply for products.  However, at FPI's discretion, they
can use it to negotiate with FPI on factors such as product quality
or delivery time frames, or to seek a waiver from FPI so that they
can buy from a commercial vendor that can better meet their quality
or delivery requirements.  Under 18 U.S.C.  4124 (b) disputes
regarding "price, quality, character, or suitability" of products
furnished by FPI are subject to resolution by a high-level
arbitration board made up of the Attorney General, the Administrator
of the General Services, and the President, or their representatives. 
The Postal Service, which is exempt from most federal laws dealing
with public or federal contracts, is not required to buy FPI products
and can treat FPI like a commercial vendor.\17


--------------------
\16 According to FPI officials, there are no aggregate data to show
how often FPI allows agencies to include these provisions in the
contracts.  However, they did say that its contracts for electronics
and textiles typically include a provision to terminate contracts for
default.  Because data were not readily available, we did not verify
the extent to which cancellation or termination provisions were
included in contracts associated with the numerous products that FPI
sells to government agencies. 

\17 Services provided by FPI are not afforded the same mandatory
source status as products provided by FPI.  Officials we spoke with
at agencies other than the Postal Service did not, at the time of our
review, have direct knowledge of service contracts with FPI because
these contracts tend to be small and are handled by local procurement
offices.  Postal Service officials said they treat FPI service and
product contracts alike because neither is mandatory for the Postal
Service.  During fiscal years 1995 and 1996, contracts for services
constituted about 5 percent of FPI's annual sales. 


      PRE-AWARD PROCESS
---------------------------------------------------------- Letter :4.1

Officials at DLA, FSS, Army, and SSA said that before awarding a
contract, they do many of the same things when considering
acquisitions from both commercial vendors and FPI.  Generally, in
considering price, agency contracting officials are to examine the
prices offered by a prospective vendor and take steps, such as a
price evaluation if, in their judgment, they believe the offerer's
price does not represent a good value for the government.  With
commercial vendors, a price that is found to be high can be used as a
factor in eliminating a prospective vendor from the selection
process.  However, because of FPI's mandatory source status, they
told us that the contracting officer is limited to using the results
of his or her assessment of price to attempt to negotiate the price
with FPI or justify a waiver request.  FPI is required by statute to
price its products at not to exceed current market price.\18
According to FPI, the method for determining current market price
varies by product and the price can be negotiated by FPI and the
customer.  If the agency is not satisfied with the price and the
cognizant FPI personnel deny the waiver request, the contracting
officer can appeal the decision to the FPI ombudsman.  We did not
determine how often prices were negotiated or waivers approved by
cognizant FPI personnel or the FPI ombudsman. 

In addition, for commercial vendors, agency officials said that
contracting officers are to make a determination of "responsibility"
in accordance with FAR Part 9; that is, they assess whether the
vendor has such resources as the facilities and personnel needed to
carry out the terms of the contract.  If the vendor had a previous
contract with the agency, they are required to examine the vendor's
past performance record.  However, in the case of FPI, agency
officials told us that contracting officials cannot disqualify FPI
from being eligible for a contract award based on "responsibility"
because, again, FPI is a mandatory-source supplier.  Nonetheless,
they said that in contracting with FPI, agency contracting officials
may consider their experiences on previous FPI contracts and may
attempt to negotiate contract terms designed to avoid previous
difficulties.  They also may rely on these experiences to develop
request for waivers from FPI. 

According to officials at the Postal Service, they do many of the
same things their non-Postal counterparts do to consider things like
price and vendor responsibility during the pre-award process. 
However, because the Postal Reorganization Act of 1970 exempts the
Postal Service from most federal laws dealing with federal or public
contracts, FPI is not a mandatory source for the Postal Service.\19
As with other agencies, before awarding a contract, Postal
procurement officials told us that they have discretionary authority
to check that the price is fair and reasonable and examine whether
vendors are capable of performing under the contract.  However,
unlike their counterparts, they do not have to purchase products from
FPI.  Instead, Postal Service officials can procure the product from
another vendor. 


--------------------
\18 In 11 Comp.  Gen.  75 (1931) GAO quoted a February 1931 decision
by the BOP Board of Arbitration--Prison Industries which stated that
FPI did not have to set its price at the lowest bid price to comply
with the current market price requirement. 

\19 Under the U.S.  Postal Service Purchasing Manual, contracting
officers can consider purchasing from FPI when the quality, delivery
terms, and prices offered are competitive with those offered in the
commercial marketplace.  Thus, according to Postal Service officials,
the Postal Service can acquire supplies from FPI by either (1)
following the formal competitive procurement procedures, which
typically includes soliciting proposals that the Postal Service
evaluates before awarding the contract to the supplier providing the
best overall value; or (2) negotiating a noncompetitive contract
directly with FPI on a sole source basis if market research or other
means show price and delivery terms are reasonable compared with
those available within the commercial marketplace. 


      CONTRACT ADMINISTRATION
---------------------------------------------------------- Letter :4.2

Once a contract is awarded, contracting officers are to take steps to
administer contracts, including those with FPI, in accordance with
their responsibilities under the FAR.  The officials we spoke with at
DLA, FSS, SSA, and Army told us that contracting officers have
discretion over the depth of monitoring activities they do and the
data they collect.  However, their efforts are to include an
assessment of the extent to which the vendors meet the terms and
specifications of the contract and may involve specific steps to
ensure a vendor's products meet the quality standards specified in
the contract.  In doing so, contracting officials monitor issues
related to overall performance, such as timeliness of delivery and
quality issues arising out of user complaints.  DLA and FSS
officials, for example, told us that contracting officers track and
document issues related to timeliness, product quality, and
complaints from product users.  SSA and Army officials said that
contracting officers look at some of the same things and, like DLA
and FSS, tend to work with vendors to resolve problems.  According to
officials we spoke with, it is important to recognize that monitoring
of things like product quality is quite often done on an exception
basis--that is, contracting officers deal with problems as they
arise, such as when a complaint is levied by an end user. 

As with their counterparts in other agencies, Postal Service
officials also said that they take steps to monitor contracts from
the perspective of contract terms and assurance that the vendor can
meet its quality standards.  They added that contracting officers,
who likewise have discretionary authority over the depth of their
oversight responsibilities, examine things like customer complaints
about quality and try to work with vendors to resolve them.  In
addition, they told us that contracting officers routinely monitor
timeliness as one of the elements of compliance with the contract. 
Like their non-Postal counterparts, Postal Service officials said
that contracting officers attempt to work with vendors to resolve
problems if and when they arise. 


      CONTRACTOR PERFORMANCE
      RATINGS
---------------------------------------------------------- Letter :4.3

As part of routine contract administration, DLA, FSS, SSA, and Army
also have processes for rating the overall performance of many of
their commercial vendors in accordance with the FAR.  In addition,
officials at the major supply agencies, DLA and FSS, also said that
they routinely evaluate and rate FPI's performance as part of their
general business practices.  SSA and Army officials told us that they
do not routinely do so for FPI, because the FAR exempts FPI from the
requirement that customer agencies develop performance
evaluations.\20 According to officials at the Postal Service, the
Service, which is not covered by the FAR, evaluates and rates the
performance of certain vendors, including FPI, that are selected by
contracting officers based on factors like the dollar magnitude of
the contract or the product being critical to achieving the agency's
mission.  According to these officials, the Postal Service evaluation
includes a variety of factors, such as fabrication and assembly,
workmanship, and timeliness, that are based on agreements between the
Postal Service and the vendor and prescribed in the contract.  With
regard to the ratings, the same officials told us that FPI's
performance, like that of its other vendors, has been generally
acceptable. 

As mentioned earlier, Subpart 42.15 of the FAR requires that agencies
do performance evaluations to document a contractor's actions for
consideration of future contracts.\21

According to the FAR, these evaluations--required for each contract
in excess of $1 million beginning July 1, 1995, and $100,000 after
January 1, 1998--are to be done at the time the work under the
contract is completed and are to be prepared on an interim basis for
contracts exceeding 1 year.  The FAR also stipulates that agencies
shall not prepare evaluations of contractors under Subpart 8.6--the
provision pertaining to FPI. 

For example, as of December 1997, SSA officials told us that SSA
requires that project officers and technical representatives involved
in contract administration prepare a monthly evaluation of commercial
vendor contracts valued in excess of $500,000 (below the 1995
threshold of $1 million) but not of contracts with FPI.  These
officials then are to send the evaluations to the responsible
contracting officers, who compile them and prepare a separate
evaluation report at the end of the contract.  In doing their monthly
evaluations, agency officials are to use a scale of 0
(unsatisfactory) to 4 (excellent) to measure a contractor's
performance in six dimensions--quality of product or service, cost
control, timeliness of performance, business relations, end user
customer satisfaction, and other.  SSA officials told us that SSA
does not do these evaluations for FPI products, because it is not
required to do so under the FAR. 

Even though the FAR states that agencies shall not prepare
evaluations regarding FPI performance, officials at the two major
supply agencies included in our review told us that they do the
evaluations for all vendors, including FPI, as part of their normal
business processes.  For instance, DLA officials told us that they
use DLA's Automated Best Value Model (ABVM) to collect past
performance data on all of its contracts, including those with FPI,
regardless of size and translate the data into a numeric score
ranging from a low of 0 to a perfect score of 100.  The scores, which
are calculated monthly, represent a combination of quality and
delivery scores.  The quality score reflects validated product and
packaging problems caused by the contractor and negative lab tests
during the rating period.  The delivery score reflects shipments that
are not shipped and/or received in their entirety by the contract
delivery date.  DLA then updates the score every month and makes it
available to vendors so that they can gauge their performance and
challenge scores when they disagree.  The scores are also available
to contracting officers so that they can consider them in conjunction
with outputs from other DLA contract monitoring systems when making
decisions about future source selections.  Because of the disparate
nature of these various systems, data were not readily available for
developing an aggregate analysis of FPI's performance over any
particular period in time.  In other words, at DLA, FPI performance
successes and problems would have to be analyzed on a
product-by-product and factory-by-factory basis using the various
systems available. 

At FSS, contracting officials told us that they prepare a supplier
rating report for all of FSS' contracts, including those with FPI,
using seven dimensions--contracts terminated, orders terminated,
deliveries on-time per the "original" due dates, quality cure letters
issued, justified quality complaints, quality deficiency notices
issued, and rejections.  Performance in each category is scored on a
scale of outstanding, satisfactory, or poor.  Every 6 months, FSS
generates a supplier rating report, sometimes called a contractor
report card, which enables FSS and the vendor to open a dialogue
about performance issues.  At the conclusion of the contract, FSS
issues a final report rating the contractor's performance along with
a letter that tells the contractor that its past performance will be
considered when GSA makes future awards. 

FSS officials told us that they also use the supplier report card to
prepare FSS's contractor alert list (CAL), which identifies
contractors that fail to meet some portion of their contract terms
and are considered to be a higher risk to the government as future
contractors.  Thus, if a vendor, including FPI, scores a poor in any
one of the seven report card categories, the vendor and its contract
are placed on the CAL and they remain on it for a designated period,
depending on the problem documented.  For example, a poor timeliness
rating would cause a vendor and its contract to show up on the CAL
until the timeliness problem was corrected, whereas a quality
deficiency problem may cause a vendor and its contract to remain on
the CAL for the duration of the contract.  Upon reviewing examples of
the CAL, we noted that both commercial vendors and FPI contracts were
on the CAL for a variety of reasons, including quality and timeliness
problems.  FSS officials told us that as of August 1997, 17 of FPI's
60 contracts with GSA were on the CAL because of timeliness problems;
and 1 of FPI's 60 contracts was on the CAL because of a product
quality problem.  FPI's remaining 42 contracts were not on the CAL. 

It is important to note that as in the pre-award process, FSS, DLA,
SSA, and Army can use the information they collect via a report card
or any other means to communicate about performance issues with
vendors, including FPI.  However, the agencies can terminate a
contract with a commercial vendor, but they cannot cancel or
terminate a contract with FPI unless FPI had agreed to include
provisions in the contract that allow the agency to either cancel the
contract or terminate it for default.  Nonetheless, FSS, DLA, SSA,
and Army can use the information they collect on any particular FPI
acquisition to initiate waiver requests, so that if the waiver is
approved, the balance of an agencies' requirements can be filled by a
vendor other than FPI.  Likewise, in terms of new acquisitions from
commercial vendors, these agencies can use performance information as
a basis for making acquisition decisions and considering the award of
a contract.  With FPI, however, FSS, DLA, SSA, and Army cannot use
the information to make a decision about buying FPI products, but
they can use it to alert FPI to past problems, negotiate with FPI
about ways to prevent future problems, or to apply for waivers so
they can buy from another source.  The Postal Service, on the other
hand, can treat FPI like any other vendor, because FPI is not a
mandatory source for the Postal Service. 

There is some question about whether agencies subject to the FAR are
prohibited from evaluating FPI's performance.  As mentioned earlier,
Part 42 of the FAR states that agencies "shall not" evaluate the
performance of contracts awarded under Subpart 8.6, the provision
pertaining to FPI.  According to OFPP's Deputy Associate
Administrator for Procurement Innovation, this provision was added to
the FAR because FPI is considered to be a social program and has
mandatory source status; and, regardless, agencies still have to
purchase FPI products.  It was designed to reduce the burden on
agencies by not requiring them to develop performance data on FPI. 
However, he said the provision was never intended to preclude
agencies from doing performance evaluations of FPI contracts as part
of their efforts to maintain good business practice.  As we pointed
out, some agencies do it as part of their normal business practices,
and others do not because they are not required to.  The Deputy
Associate Administrator added that OFPP is recommending a change to
the FAR that would make it clear that agencies are not precluded from
doing performance evaluations on mandatory source suppliers like FPI,
especially since OFPP promotes vendor performance evaluations as good
business practice. 

According to OFPP guidelines on performance evaluations, as of August
1995, there were at least 12 past performance information systems in
use by various organizations throughout the government.\22 Although
OFPP sanctioned these systems as long as they met the requirements of
the FAR, it is encouraging the voluntary development of a uniform
governmentwide format for recording contractor performance
information that source selection officials can use.  In doing so,
OFPP has suggested the development of an interagency Contractor
Performance Report, which, among other things, would contain six
areas in which to rate a contractor's performance--quality,
timeliness, cost control, business relations, customer satisfaction,
and key personnel.  According to OFPP, some of the elements, like
timeliness, are important because they directly reflect compliance
with contract terms.  Others, however, like customer satisfaction,
are equally important because, according to OFPP's guidelines,
satisfying the customer is the most important goal in the private
sector and should be in the government sector.  With regard to the
customer satisfaction element, OFPP goes on to suggest that agencies
look at the satisfaction of the end users and that the best way to do
so is through customer satisfaction surveys.  If agencies collect
this information, it may provide FPI with additional customer
satisfaction data that could supplement any efforts it decides to
take to develop systematic data and performance measures. 


--------------------
\20 FAR Part 42.1502(b) states that agencies shall not evaluate
performance for contracts awarded under Subparts 8.6 and 8.7.  FAR
Subpart 8.7 governs acquisitions from nonprofit agencies employing
people who are blind or severely disabled, which are mandatory source
suppliers.  The issue of rating FPI performance is addressed later in
the report. 

\21 The Federal Acquisition Streamlining Act (FASA) of 1994, Public
Law 103-355, amended the Office of Federal Procurement Policy Act at
41 U.S.C.  405 note and acknowledged that it is both appropriate and
relevant for the government to consider a contractor's past
performance in evaluating whether the contractor should receive
future work. 

\22 Past Performance Information, Office of Federal Procurement
Policy, OFPP Policy Letter 92-5, August 2, 1995. 


   CONCLUSIONS
------------------------------------------------------------ Letter :5

The debate over FPI's mandatory source status and the timeliness,
price, and quality of its products and services is likely to continue
partly because FPI lacks sufficient data on how federal customers
view FPI's products and services.  FPI's current management
information systems are not designed to systematically collect
federal customers' views, and FPI's current efforts to obtain
customers' feedback are limited and cannot be used to support general
conclusions about customer satisfaction.  Without this information,
FPI is not well positioned to demonstrate whether it is achieving
total customer satisfaction as it says it is striving to do or to use
customer satisfaction as a key performance measure.  Furthermore, the
lack of a systematic approach for collecting and analyzing these data
is inconsistent with recent public and private sector initiatives to
use customer satisfaction data to measure performance and address
real and perceived performance problems. 

Although FPI has recognized the importance and benefits of obtaining
and using more data on customer satisfaction and made a commitment in
October 1995 to doing so, it has not followed through on this
commitment, citing personnel turnover, resource constraints, and the
need for customer cooperation.  We recognize that it may be
challenging and resource intensive for FPI to develop better data and
related measures for customer satisfaction and that FPI will need the
cooperation of its customers.  However, we believe it will be more
challenging for FPI to continue to operate in today's
customer-oriented environment and in the face of strong opposition to
its mandatory-source status without the benefit and use of such
information, both to improve performance and to measure its
performance in meeting customer satisfaction goals. 

FPI is a governmental organization that operates in a businesslike
fashion in that it manufactures and sells products to customers. 
Thus, it seems reasonable that FPI would have guidelines and
principles used by other public and private sector organizations such
as those calling for systematic assessment of customer satisfaction,
and then using that information to measure and improve performance. 
Several other organizations we identified in both the private and
public sectors have found various approaches to systematically
collect and use such information, either independently or with the
help of others, such as contractors.  We found no reason why FPI
could not also search for cost-effective ways to assess customer
satisfaction.  In considering these approaches, FPI will need to
determine what approach or combination of approaches will produce the
best results at the lowest possible cost and least possible burden on
its customers. 


   RECOMMENDATION TO THE DIRECTOR,
   BUREAU OF PRISONS
------------------------------------------------------------ Letter :6

In order to institutionalize within FPI an assessment of overall
customer satisfaction and the use of this assessment to measure and
improve performance, we recommend that the Director, Bureau of
Prisons, direct FPI's Chief Operating Officer to (1) examine
available approaches to collect and use customer satisfaction data to
determine the most cost-effective approaches for FPI; (2) develop a
plan for collecting customer satisfaction data that would allow for
supportable conclusions about federal customers' views on timeliness,
price, and quality; (3) develop a timetable for implementing the
plan; and (4) set performance goals for the levels of customer
satisfaction that FPI wants to attain and measure results against
these goals. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :7

In written comments dated February 10, 1998, BOP generally agreed
with the thrust of the draft report and said that it intends to
implement our recommendation.  BOP also made additional comments on
some of the issues addressed in the report.  First, BOP acknowledged
that the draft identified many of the initiatives FPI has taken to
demonstrate its commitment to customer satisfaction and listed some
other initiatives that it has taken over the last few years. 
Furthermore, BOP recognized that FPI does not have a systematic
approach for measuring customer satisfaction and how its customers
responded to these initiatives.  Second, BOP highlighted some of the
problems FPI may encounter in collecting data because of the nature
of the federal procurement process and said that some highly
respected private sector vendors do virtually no federal customer
satisfaction data collection.  But, in agreeing with our
recommendations, BOP stated that there is a benefit to collecting
customer satisfaction data.  Third, BOP stressed the importance of
agency evaluations in providing feedback on FPI's performance and
said FPI would advise its customers of FPI's desire to be evaluated
so that it can get such feedback and of its willingness to include
termination clauses in FPI's contracts. 

Finally, BOP said FPI's actions to improve customer satisfaction have
been aimed at eliminating negative perceptions about purchasing from
FPI as a mandatory source and stated that FPI is striving to be
viewed as a "preferred" source.  BOP added that in its view, FPI's
most vocal opponents are not customers but private industry
representatives who maintain that FPI, as a mandatory source
supplier, has an adverse effect on them.  Furthermore, BOP stated its
belief that regardless of FPI's customer satisfaction rating,
opponents will continue to argue against FPI's status as a mandatory
source supplier.  (See app.  II for the full text of BOP's written
comments.)

We also obtained oral technical comments from FPI's Chief Operating
Officer and his staff and from program officials in the agencies
included in our review on various portions of a draft of this report. 
These technical comments have been incorporated in the final report
as appropriate. 


---------------------------------------------------------- Letter :7.1

As agreed with your office, unless you publicly announce the contents
of this report earlier, we will not distribute it until 30 days from
its date.  Then, we will send copies of this report to the Attorney
General, Director of BOP, Chief Operating Officer of FPI, Director of
the Office of Management and Budget, Administrator of OFPP, and the
heads of the customer agencies we contacted.  We will also make
copies available to interested congressional committees and others on
request. 

Major contributors to this report are listed in appendix III.  If you
have any questions, please contact me on (202) 512-8387. 

Bernard L.  Ungar
Director, Government Business
 Operations Issues


OBJECTIVES, SCOPE, AND METHODOLOGY
=========================================================== Appendix I

Our objectives were to determine (1) if Federal Prison Industries
(FPI) has data, either from its management information systems or
other sources, to support overall conclusions about how federal
customers who buy and use its products and services view their
timeliness, price, and quality; and (2) whether agencies who are
among the largest buyers of FPI products and services monitor FPI's
performance the same way they do commercial vendors in terms of
timeliness, price, and quality.  In doing our work, we interviewed
FPI officials and gathered information on their customer satisfaction
efforts at FPI in Washington, D.C.  We also met with officials at
FPI's Customer Service Center in Lexington, KY; the Office of Federal
Procurement Policy (OFPP); and spoke with officials at five major
customer agencies--the Defense Logistics Agency (DLA); the General
Services Administration's (GSA) Federal Supply Service (FSS) in
Arlington, VA, and Fort Worth, TX; the Department of the Army's
Office of the Assistant Secretary of the Army for Research,
Development, and Acquisition in Falls Church, VA; the Social Security
Administration (SSA) in Baltimore, MD; and the United States Postal
Service (Postal Service) in Washington, D.C. 

We also did limited work at the Department of Health and Human
Services (HHS) in Washington, D.C.; the Department of Defense's (DOD)
Office of the Secretary of Defense at the Pentagon; and the National
Institutes of Health (NIH) in Bethesda, MD; and we spoke with
officials from various trade associations and one company that does
customer satisfaction analysis.  We attended an FPI customer advisory
group meeting in Orlando, FL.  We did not assess FPI's overall
efforts to promote customer satisfaction, such as resolving
complaints or granting waivers, nor did we assess customer agencies'
efforts to award and administer vendors' contracts.  We also did not
assess agencies' efforts to monitor small purchases from FPI, such as
credit card purchases. 

To meet the first objective, we interviewed FPI officials at FPI
headquarters in Washington, D.C., to discuss their efforts to collect
and analyze customer satisfaction data and whether existing
management systems were used to gauge customer satisfaction.  We then
obtained and analyzed various FPI documents that discussed FPI
efforts in the area of customer satisfaction and examined surveys and
the results of surveys that were available from officials at FPI
headquarters.  We also worked with headquarters officials to collect
and analyze information about what individual prisons do to monitor
customer satisfaction. 

In addition, we reviewed key laws and regulations pertaining to FPI. 
We also reviewed Executive Order 12862--Setting Customer Service
Standards; related NPR reports; media publications about FPI in
particular and customer satisfaction in general; case studies
documenting the experience of award recipients under the President's
Quality Award Program and the criteria for the President's Quality
Award and the Malcolm Baldrige National Quality Award; and GAO
reports dealing with customer satisfaction and agency performance
measurement, including reports on the implementation of the
Government Performance and Results Act of 1993.  Early in our review,
we also explored the possibility of using data from FPI's customer
order entry database (COED), which is housed in Lexington, KY, to
conduct our own customer satisfaction survey.  However, as discussed
in the report, we were unable to use COED data, because, among other
things, it did not identify end users.  We also spoke with
representatives of two trade associations about their members'
efforts to monitor customer satisfaction and with a representative of
a company that does customer satisfaction analysis for private and
public organizations.  Finally, we did a literature search of
publications pertaining to customer satisfaction and public and
private organizations' efforts to collect customer satisfaction
information and use it to measure and improve performance. 

To meet the second objective, we reviewed key laws and regulations,
such as the Federal Acquisition Regulation (FAR), pertaining to
procurement from commercial vendors and FPI, especially in relation
to vendor performance.  Using FPI sales reports, we initially
selected four of FPI's major customer agencies--DOD, GSA, HHS, and
the Postal Service--to examine their approach for monitoring the
performance of commercial vendors and FPI.  We selected these
agencies because they had the largest volume of FPI sales during
fiscal years 1995 and 1996.  We did not select the Bureau of Prisons
(BOP), another major purchaser of FPI products, because of BOP's
relationship with FPI.  Because of staffing constraints and time
limitations, we further refined our selections at DOD, the largest of
FPI's customers, to include only DLA and Army, which, according to
FPI sales records, were the DOD agencies with the largest volume of
sales during fiscal year 1996.  At GSA, the second largest FPI
customer in terms of sales volume during fiscal year 1996, we focused
primarily on FSS, which, according to FPI, constituted more than
three-fourths of FPI's sales to GSA. 

In addition, at HHS, our discussions with procurement officials
indicated that the volume of FPI sales to HHS was relatively small,
contrary to FPI sales figures for both fiscal years.  Subsequently,
we contacted the Manager of FPI's Planning, Research and Activation
Branch, who told us that HHS sales figures still included SSA, which
became a separate agency in 1995.  He added that the vast majority of
HHS sales listed in FPI's sales report for both fiscal years were
actually attributable to SSA and that FPI plans to change the sales
report in the future to reflect the change in SSA's relationship to
HHS.  As a result of our conversations, we selected SSA as one of the
agencies for our examination.  We also met with an official of OFPP
in Washington, D.C., to discuss OFPP guidelines and initiatives
pertaining to evaluating contractor performance. 

To determine how the five selected agencies monitor the performance
of commercial vendors and FPI, we spoke with responsible officials in
each of the agencies to discuss their overall efforts to evaluate the
performance of commercial vendors and FPI as part of the procurement
process and in administering contracts.  Our discussions focused on
the processes and procedures these agencies used to evaluate the
performance of commercial vendors and FPI.  We also focused on the
similarities and differences in how commercial vendors and FPI are
treated in terms of performance evaluation, including remedies for
nonperformance of contract terms.  We also obtained and analyzed
agency documents that described their processes and procedures for
vendor performance evaluations.  Although we obtained examples of
their evaluations, we did not (1) comprehensively evaluate their
efforts or determine whether they complied with applicable laws and
regulations or (2) do an independent assessment of whether customer
agencies were satisfied with FPI and its products and services.  For
purposes of this report, we used the term contract to include agency
agreements with FPI. 

We did our work between July 1997 and January 1998 in accordance with
generally accepted government auditing standards.  We received
written comments on a draft of this report from BOP, which we have
included in appendix II.  BOP's comments are summarized and discussed
on page 29.  FPI's Chief Operating Officer and his staff also
provided several oral technical comments on various portions of a
draft of this report.  We also held exit conferences with program
officials of the other federal agencies to verify selected data and
facts presented in the report. 




(See figure in printed edition.)Appendix II
COMMENTS FROM THE BUREAU OF
PRISONS
=========================================================== Appendix I



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix III

GENERAL GOVERNMENT DIVISION,
WASHINGTON, D.C. 

Gerald Stankosky, Assistant Director
John F.  Mortin, Assistant Director
William J.  Dowdal, Senior Evaluator
David E.  Sausville, Senior Evaluator
Martin de Alteriis, Senior Social Science Analyst
Hazel Bailey, Evaluator (Communications Analyst)

OFFICE OF GENERAL COUNSEL,
WASHINGTON, D.C. 

Alan Belkin, Assistant General Counsel
Susan Michal-Smith, Senior Attorney

DALLAS FIELD OFFICE

Robert T.  Griffis, Senior Evaluator
Patricia Sari-Spear, Senior Evaluator


*** End of document. ***