00-26413. Arbitration Panel Decision Under the Randolph-Sheppard Act

AGENCY:

Department of Education.

ACTION:

Notice of arbitration panel decision under the Randolph-Sheppard Act.

SUMMARY:

Notice is hereby given that on January 10, 2000, an arbitration panel rendered a decision in the matter of Donald Schone and Ray Fitzpatrick v. Illinois Office of Rehabilitation Services, Department of Human Services (Docket No. R-S/97-10). This panel was convened by the U.S. Department of Education pursuant to 20 U.S.C. 107d-1(b) upon receipt of a complaint filed by petitioners, Donald Schone and Ray Fitzpatrick.

FOR FURTHER INFORMATION CONTACT:

A copy of the full text of the arbitration panel decision may be obtained from George F. Arsnow, U.S. Department of Education, 400 Maryland Avenue, SW., room 3230, Mary E. Switzer Building, Washington DC 20202-2738. Telephone: [phone]. If you use a telecommunications device for the deaf (TDD) you may call the TDD number at [phone].

Individuals with disabilities may obtain this document in an alternate format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed in the preceding paragraph.

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Note:

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SUPPLEMENTARY INFORMATION:

Pursuant to the Randolph-Sheppard Act (20 U.S.C. 107d-2(c)) (the Act), the Secretary publishes in the Federal Register a synopsis of each arbitration panel decision affecting the administration of vending facilities on Federal and other property.

Background

This dispute concerns the alleged improper denial of the vendors' request to be transferred to another facility by the Illinois Office of Rehabilitation Services, Department of Human Services, the State licensing agency (SLA).

A summary of the facts is as follows: In 1990, complainants Mr. Donald Schone and Mr. Ray Fitzpatrick signed separate operating agreements with the SLA to manage vending facilities #405 and #406 at the Old Post Office Building, 433 West Van Buren Street, Chicago, Illinois. In approximately 1992, the SLA was informed by the United States Postal Service that this location was to be closed and a New Post Office was to be constructed across the street at 433 West Harrison. Complainants contended that they should not be required to bid on other locations, but rather that the SLA should transfer them to the New Post Office at 433 West Harrison Street to operate the two vending facilities available at that location.

The complainants requested and received a State fair hearing concerning their complaint regarding the SLA's transfer and promotion policies. The Hearing Officer ruled that the SLA was not required to transfer Mr. Schone and Mr. Fitzpatrick to the New Post Office vending facilities without the bidding process. On April 22, 1997, the SLA adopted the Hearing Officer's ruling as final agency action. It was this decision that the complainants sought to have reviewed by a Federal arbitration panel. An arbitration hearing on this matter was held on June 17, 1999.

Arbitration Panel Decision

The central issue before the arbitration panel was whether the SLA was required by the Act (20 U.S.C. 107 et seq.), the implementing regulations (34 CFR part 395), and applicable State rules and regulations to transfer Mr. Donald Schone and Mr. Ray Fitzpatrick to the vending facilities in the New Post Office at 433 West Harrison Street without bidding or other procedures after the closing of the Old Post Office at 433 West Van Buren Street.

The majority of the panel found that the complainants' rights and entitlement flowed from the terms of their vendor operating agreements, which were very specific and limited. Those agreements provided rights to the operation of vending facilities located at the Old Post Office, 433 West Van Buren Street. The panel further determined that, for reasons unrelated to the actions of the SLA, the United States Postal Service closed this Federal property. Therefore, the majority of the panel ruled that the operating agreements signed by the complainants to operate vending facilities at the Old Post Office, 433 West Van Buren Street, did not give them transfer rights to the New Post Office vending facilities at 433 West Harrison.

Based upon the evidence presented, the majority of the panel rejected complainants' reliance upon the fact that a new permit had not been obtained by the SLA for the New Post Office location. The panel reasoned that the vendor operating agreements signed by the complainants in 1990 were not tied to a specific permit that would somehow give Mr. Schone and Mr. Fitzpatrick transfer rights to the New Post Office. Instead, the panel concluded that the 1990 agreements were tied to a specific location, the Old Post Office at 433 West Van Buren, which no longer existed.

One panel member dissented.

The views and opinions expressed by the panel do not necessarily represent the views and opinions of the U.S. Department of Education.

Dated: October 6, 2000.

Judith E. Heumann,

Assistant Secretary for Special Education and Rehabilitative Services.