Amends the Federal criminal code to authorize Federal Prison Industries (FPI) to sell excess or obsolescent property on the open market at the best available price, with the proceeds of such sales to be deposited to the Prison Industries Fund.

Requires FPI to determine the character of and necessity for its obligations and expenditures and the manner in which they shall be incurred, allowed, and paid, subject to laws applicable to Government corporations. (Current law requires FPI to deposit all of its monies into the Fund.)

Requires commodities and services produced by FPI to be sold at current market prices and to conform to Federal and relevant private industry design, quality, and testing standards.

Accords services of the workshops for the handicapped priority for Federal purchasing over those offered by FPI if both entities offer competitive services. Requires Federal agencies to provide to FPI the maximum opportunity to participate as a subcontractor in labor-intensive, light manufacturing segments of awarded contracts.

Authorizes FPI to: (1) produce or provide for sale on the open market processes, products, and services that would otherwise be produced by foreign labor at offshore locations; and (2) enter into agreements with private industry for such purposes. Requires FPI to certify that such products, processes, or services: (1) are labor-intensive and limited to levels that replace goods and services produced by offshore labor; and (2) do not significantly increase competition with any remaining domestic labor or industry.

Authorizes FPI to: (1) produce and provide recycled materials for sale on the open market; and (2) produce or provide goods and services for sale or donation on the open market to private, nonprofit organizations to assist in disaster relief.

Exempts: (1) items sold on the open market pursuant to this Act from the prohibition against shipment in commerce of prison-made goods; and (2) inmates who work on the production of products or services from the minimum wage requirements of the Fair Labor Standards Act of 1938.

Authorizes FPI funds to be used to enter into contracts related to the purchase of goods for industrial operations without regard to laws governing procurement by Federal agencies.