Bill Text: MI HB5658 | 2011-2012 | 96th Legislature | Engrossed
Bill Title: Corrections; other; use of prison labor by private contractor; allow under certain circumstances. Amends secs. 2, 6 & 7a of 1968 PA 15 (MCL 800.322 et seq.).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2012-07-18 - Assigned Pa 261'12 With Immediate Effect [HB5658 Detail]
Download: Michigan-2011-HB5658-Engrossed.html
HB-5658, As Passed House, June 7, 2012
SUBSTITUTE FOR
HOUSE BILL NO. 5658
A bill to amend 1968 PA 15, entitled
"Correctional industries act,"
by amending sections 2, 6, and 7a (MCL 800.322, 800.326, and
800.327a), section 2 as amended and section 7a as added by 1996 PA
537 and section 6 as amended by 2010 PA 308.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. As used in this act:
(a) "Correctional industries products" means all services
provided, goods, wares, and merchandise manufactured or produced,
wholly or in part, by inmates in any state correctional
institution,
but does not include products either
of the following:
(i) Products manufactured with inmate labor or services
rendered with inmate labor in a private manufacturing or service
enterprise established under section 7a.
(ii) Goods or services provided by inmate labor assigned to a
private contractor to be used solely within a correctional
institution, jail, or reentry facility.
(b)
"Youth correctional facility" means a facility established
under
section 20g of Act No. 232 of the Public Acts of 1953, being
section
791.220g of the Michigan Compiled Laws.
(b) "Correctional institution" means a state prison, prison
facility, or other prison institution, correctional camp, community
corrections center, correctional farm, state reformatory, or
probation recovery camp, owned, operated, leased, supervised, or
contracted for by this state.
Sec. 6. (1) Correctional industries products may be sold,
exchanged, or purchased by any of the following:
(a) An institution of this or any other state or political
subdivision of this or any other state, the federal government or
agencies of the federal government, a foreign government or
agencies of a foreign government, or, except as provided in
subsection
(5), (6), a private vendor that operates a correctional
facility in this state.
(b)
Except as provided in subsection (5), (6), any
organization that is a tax exempt organization under section
501(c)(3) of the internal revenue code, or any organization or
individual that acts as a fiduciary for a tax exempt organization
under section 501(c)(3) of the internal revenue code and certifies
that the product sold or exchanged under this act is intended for
use by a tax exempt organization under section 501(c)(3) of the
internal revenue code.
(c)
Except as provided in subsection (5), (6), any private
business or individual, if the products are cut and sewn textiles,
but only if the same or a comparable in style product is not
manufactured by a private business in this state. However, this
subdivision no longer applies beginning on the later of the
following dates:
(i) The date cut and sewn textiles are being manufactured under
the prisoner industry enhancement certification program under
section 4(h) and sold, exchanged, or purchased under subdivision
(d).
(ii) June 1, 2015.
(d)
Except as provided in subsection (5), (6), any private
individual, corporation, partnership, or association in this state
and in interstate commerce if the products are manufactured under
section 4(h).
(2) An agricultural product that is produced on a correctional
farm may be utilized within the correctional institutions or within
a correctional facility in this state notwithstanding its operation
by a private vendor or sold to an institution, governmental agency,
or organization described in subsection (1) or sold for utilization
in the food production facilities of the department of corrections
notwithstanding the operation of those facilities by a private
vendor. An agricultural product that is not utilized or sold as
provided in this subsection shall be made available without charge
to nonprofit charitable organizations or to the family independence
agency for use in food banks, bulk food distributions, or similar
charitable food distribution programs. This subsection does not
apply to an agricultural product that is not in a form suitable for
use in the manner prescribed in this section, such as bulk grain,
live cattle, and hogs, which may be sold on the open market.
(3)
Except as provided in subsection subsections (2), (4), and
(5), the labor of inmates shall not be sold, hired, leased, loaned,
contracted for, or otherwise used for private or corporate profit
or for any purpose other than the construction, maintenance, or
operation of public works, ways, or property as directed by the
governor. This act does not prohibit the sale at retail of articles
made by inmates for the personal benefit of themselves or their
dependents or the payment to inmates for personal services rendered
in the correctional institutions, subject to regulations approved
by the department of corrections, or the use of inmate labor upon
agricultural land that has been rented or leased by the department
of corrections upon a sharecropping or other basis.
(4) This act does not prohibit the assignment of prison labor
to a private contractor for the production of goods or services to
be used solely within a correctional institution, jail, or reentry
facility that houses a prisoner population under the jurisdiction
of the department. Inmates assigned by the department for the
production of goods or services that are solely used within a
correctional facility or institution that houses a prisoner
population under the jurisdiction of the department are not subject
to the prevailing or minimum wage.
(5) (4)
If more than 80% of a particular
product sold in the
United States is manufactured outside the United States and none of
that product is manufactured in this state, or if a particular
service is not performed in this state, as determined by the
department of corrections in conjunction with the advisory council
for correctional industries, inmate labor may be used in the
manufacture of that product or the rendering of that service in a
private manufacturing or service enterprise established under
section 7a. A determination by the department of corrections under
this subsection shall be made at the time the individual or
business entity applies to the department for approval to produce
that
product or render that service pursuant to under section
7a.
(6) (5)
An individual who is a member of
the state senate or
house of representatives shall not be permitted to participate,
directly or indirectly, either personally or through an affiliate,
in any program involving the sale, exchange, purchase, or
manufacture of correctional industries products until 2 years after
the date on which the individual's term of service in the senate or
house of representatives ends.
Sec. 7a. (1) Inmates may be assigned to work in a private
manufacturing or service enterprise that meets all of the following
requirements:
(a) The enterprise is suitably designed for the utilization of
inmate labor. Prisoners shall not be granted access to any
employee, customer or client information including, but not limited
to, personal addresses, telephone numbers, e-mail addresses, credit
card information or other financial information, health records, or
any information contained in personnel, client or customer files.
(b) The enterprise either is located within 10 miles of a
correctional facility or is located within a correctional facility
pursuant to a lease agreement executed between the department of
corrections and the enterprise. If the enterprise is located within
a correctional facility, the enterprise shall pay to the local
taxing authority an amount in lieu of ad valorem property taxes
equivalent to the amount of ad valorem property taxes that would
have been required if the enterprise had been located outside the
correctional facility.
(c) The enterprise manufactures products or renders services
that are permitted to be manufactured or rendered using inmate
labor,
as determined under section 6(4).6(5).
(d) The ratio of the number of employees of the enterprise to
the number of inmates assigned to work in the enterprise shall not
be less than 1 employee to 3 inmates.
(2) Only those inmates who reside in a correctional
institution having a security designation of level I, who are not
serving a sentence of life imprisonment, and who volunteer for the
assignment are eligible to be assigned to work in a private
manufacturing or service enterprise. As used in this subsection,
"security designation" means 1 of 6 levels of restrictiveness
enforced at each correctional institution, as determined by the
department, with security level I being the least restrictive and
security level VI being the most restrictive.
(3) The contract between the department and the private
manufacturing or service enterprise shall ensure that a wage that
is the higher of the prevailing wage or the minimum wage
established
pursuant to under the minimum wage law of 1964, Act No.
154
of the Public Acts of 1964, being sections 408.381 to 408.398
of
the Michigan Compiled Laws, 1964
PA 154, MCL 408.381 to 408.398,
shall be paid by the department to the inmate for work performed by
the inmate in the private manufacturing or service enterprise. The
wages of an inmate under this section shall be distributed in the
following order:
(a) The department shall withhold and pay the inmate's
applicable state and local income taxes and federal income, social
security, and medicare taxes.
(b) Of the balance remaining:
(i) If the inmate has been ordered by the court to pay
restitution to the victim of his or her crime, 20% shall be paid
for that restitution on the inmate's behalf, in accordance with the
court order, until the amount of restitution is satisfied. If
restitution is satisfied or if the inmate was not made subject to
restitution, 10% shall be added to the escrow account under
subparagraph (iv) and 10% shall be deposited with the state
treasurer and credited to the crime victims rights fund created in
section
4 of Act No. 196 of the Public Acts of 1989, being section
780.904
of the Michigan Compiled Laws, 1989
PA 196, MCL 780.904, in
addition to the amount in subparagraph (v).
(ii) If the inmate has a spouse or children, 20% shall be paid
to the inmate's spouse or children for the purpose of family
support. If the inmate's spouse or children receive aid to families
with dependent children or general assistance under the social
welfare
act, Act No. 280 of the Public Acts of 1939, being sections
400.1
to 400.119b of the Michigan Compiled Laws, 1939 PA 280, MCL
400.1 to 400.119b, while the inmate is incarcerated, the 20%
designated in this subdivision shall be deposited with the state
treasurer and credited to the general fund as repayment of that aid
or assistance, until that amount of aid or assistance is repaid.
(iii) Ten percent shall be paid to the inmate for his or her
personal use while incarcerated.
(iv) Ten percent shall be held by the department in an escrow
account for the inmate, and shall be returned to the inmate upon
his or her release.
(v) The balance remaining after the deductions specified in
subparagraphs (i) to (iv) shall be deposited with the state treasurer
and credited to the general fund, as partial reimbursement to the
state for the cost of that inmate's imprisonment and care.
(vi) The inmate shall not be eligible for unemployment
compensation or retirement benefits upon his or her release from a
work assignment or from imprisonment.
(4) The contract between the department and the private
manufacturing or service enterprise shall provide that the
department shall pay the applicable employer's share of federal
social security and medicare taxes and state worker's disability
compensation payments or contributions.
(5) The contract between the department and the private
manufacturing or service enterprise shall provide that the
enterprise shall reimburse the department for the amounts paid by
the department for the purposes described in subsections (3) and
(4). The contract also shall require the enterprise to pay to the
department an annual administrative fee equal to 1% of the total
amounts paid annually to the department by the enterprise for the
purposes described in subsections (3) and (4).
(6) The contract provisions created in this section shall not
be construed as making the prisoner an employee of the state of
Michigan.
