BOOSTING PROFITS & REDUCING COSTS: THE VALUE PROPOSITION OF PRISON INDUSTRIES

FOR PRIVATE SECTOR MANUFACTURERS& SERVICE PROVIDERS

202.455.6350

Contents

• Who We Are• Important Definitions• What We Do• Where We Are• What You Provide• Financial Benefits• Why USA and Not Off-Shore• Facilities Currently Available• History of Prison Industries• Key Contacts

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Who We Are

• Billiken Group is an international professional services firm established in 2010. One of our goals is to develop employment programs for correctional industries agencies.• We identify business opportunities that are mutually beneficial to

private sector employers and prison industries agencies.• Our leadership team has managed successful prison workforce

programs as well as international private sector companies.

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Important Definitions

Prison Industry: “any activity that rewards inmates with pay, privileges, or other benefits to create a product or service that has value for a public or private client” George E. Sexton, Rod Miller, and Victor J. Jacobsen. Operating Jail Industries: A Resource Manual.

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What We Do• We handle all the logistics of establishing a manufacturing or service

program.• Identifying factory locations.• Negotiating rates and fees.• Overseeing the build-out, tooling and factory production.• Conducting quality inspections.• And more.

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What We Do• We reduce your company’s labor and overhead expense.• We provide you with a choice

• Total control to manage the operation• Let us manage the entire operation for you.

• We provide total operational support through activation.• We can ship finished products to your customers from our US

warehouse.

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Where We Are• Billiken Group operates with a network of facilities in all 50 states. • This network of manufacturing facilities provides unsurpassed

distribution and transportation advantages and savings to our clients.

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What You Provide• Management and basic items to support production of your products.• Equipment, tooling, fixtures and work instructions. • Raw material suppliers and working capital.• Technical support.

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Financial Benefits• Billiken Group provides our clients with a single hourly loaded labor

rate per inmate that is all-Inclusive for labor, facilities, and utilities.• No Healthcare Cost• No Cap and Trade• No Workers Comp (services only)• No Building Insurance• No HR Department Expense• No Maintenance (Building)• No Rent / Lease / Utilities Cost• No Sick / Vacation Cost

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Financial Benefits • 24/7 Armed Security at no cost.• Up to 5 Years Fixed Labor Rate (service only).• An average of 300 potential employees on the waiting list at each

location• Easy ramp up and ramp down during seasonal work.• Long term employees.

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Why USA and Not Off-Shore

• The costs of doing business off-shore continues to rise with increasing labor costs and other factors.

• Skyrocketing freight costs from the rising costs of oil. • Our US locations provides a significant logistic advantage for high

labor content manufacturing and services.

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Sample List of Facilities

• 30,000 SF facility• 30,000 SF Facility• 29,000 SF Facility• 4,146 SF Facility• 22,000 SF Facility with a 14,000 SF warehouse• 8,545 SF Facility with a 3,212 SF Inside Dock Area• 12,000 SF facility• We have alliance partners with over 120 facilities nationwide that can be

available based on the number of inmates employed.

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History of Prison Industries• Prison Industry was created during the Industrial Era (1890-1935)• Based on the ideology of strong principles and rehabilitation

• Indeterminate Sentencing• Parole• Trade Training• Education• Primary Reformation over Punishment

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History of Prison Industries The six systems of inmate labor used in the twentieth century:

• Contract system – Private business paid to use inmate labor. They provided raw materials and supervised the manufacturing process inside prison facilities.

• Piece-price system – Goods were produced for private businesses under the supervision of prison authorities. Prisons were paid according to the number and quality of the goods manufactured.

• Lease system – Prisoners were taken to work sites under the supervision of armed guards. The private contractor employed them and maintained discipline.

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History of Prison IndustriesThe six systems of inmate labor used in the twentieth century:

• Public-account system – this system eliminated the use of private contractors. Industries were entirely prison owned, and prison authorities managed the manufacturing process. Goods were sold on the free market.

• Public-works system – Prisoners maintained roads and highways, cleaned public parks and recreational facilities. They also maintained and restored public buildings.

• State-use system – Prisoners manufactured only goods that could be used by other state offices, or they provided labor to assist other state agencies.

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Today’s Reality• Prisons are overcrowded due to lack of funding to build new prisons.• We now have more people in prison per capita than any other country

in the world.• Over 2 million people are behind bars.• Cost of incarceration per offender averages $30,000 annually.• Cost to build each cell averages $60,000.

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Today’s Reality• 50% of the State DOC inmates who will be released this year are

likely to recidivate within 3 years.• 50% of men and women committed to DOC have not earned a

diploma or GED. • The average reading level at intake is between 6th-8th grade.• Inmates drop out of public school because they were convicted of a

crime, had academic or behavioral problems, or lost interest.

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Think About ThisBecause 95% of offenders incarcerated in correctional facilities will eventually be released and living in our communities, with our families, children, friends and coworkers...

2/3 LAW-ABIDINGCITIZEN

THEOFFENDER

2/3 REVERTTO A LIFEOF CRIME

Serves sentence without productive work and job training: Undergoes little change while in prison/jail. Languishes in cell passing idle time.

Participates inPrison Industries:Develops self-esteem, self-worth and job skills throughmeaningful work activities,thereby contributing to successful reentry.

WHICHNEIGHBOR

DO YOUWANT?

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Purpose of Prison Industries

Prison industries represent our one chance to instill responsibility, discipline, and a sense of accomplishment in those who need it most.

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Mission of Prison Industries

Rehabilitative programs providing:

• Specific work programs.• Structured training and employment.• Instilling transferable job skills.• A positive work ethic

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Prison Industries Represent• 50 States (includes Federal prison systems and local jail jurisdictions)

• Annual Sales of $2.4 billion.• Encompass a total of 97 business units.• Employ 91,043 of inmates. • Products • Services • Prison Industry Enhancement (PIE) program• Reentry Services

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ProductsFurniture

Garments Upholstery

Electronic Assembly

Metal Products Signage

Mattresses Cable

Assembly /Wire Harness

License PlatesOffice Panel

Systems

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ServicesRefurbishing /

Remanufacturing

Bindery Pick and Pack

Order Fulfillment Call Centers Data Entry

Contract Labor Digitizing GIS / CADD Recycling

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Benefits of Prison Industries

• An effective management tool for reducing inmate idleness, thus maintaining a safe and secure work environment for both staff and inmates

• Provides inmate training with less supervision and at a lower cost than alternative programs

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Benefits of Prison Industries

• Generate revenue dollars by investing back into the community through the purchase of raw materials, supplies, equipment and services from the private sector.

• It is believed that the U.S. economy is strengthened by the participation of all able-bodied citizens, including inmates

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Benefits of Prison Industries

• Operate as self-sustaining programs with little or no cost to taxpayers.

• Provide a means for inmates to reimburse some of the costs of their incarceration.

• Lower recidivism rates when compared to the general prison population.

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Benefits of Prison Industries

Satisfy society’s mandate that inmates be put to work to pay back their debt to society by earning wages to pay fines, court costs and victims’ restitution, and by sending money home to support their own families, rather than possibly relying on public assistance.

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Who Wins With Prison Industries

• Society and our Communities • Correctional Administrators• Correctional Staff• Offenders and their Families • Local Business

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Think About This• This year, 800,000 inmates will be released from prison back into

society. • If they can’t find work, or a home, or help, they are much more likely to commit crime

and return to prison• America is the land of second chance

• When the gates of the prison open, the path ahead should lead to a better life• Billiken Group provides that second chance

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Key Contacts

Allan R. Lamberti Carlos R. CunhaFounder & CEO Executive DirectorAllan@BillikenGroup.com Carlos@BilllikenGroup.com203.537.9900 703.965.8848

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Acknowledgements

Background information provided by the National Correctional Industries Association: www.nationalcia.org

The NCIA is an international nonprofit professional association whose members represent all 50 state correctional industry agencies, Federal Prison Industries, foreign correctional industry agencies and city/county jail industry programs.

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