03-15415. Arbitration Panel Decision Under the Randolph-Sheppard Act

AGENCY:

Department of Education.

ACTION:

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

SUMMARY:

The Department gives notice that on August 2, 2002, an arbitration panel rendered a decision in the matter of Alabama Department of Rehabilitation Services v. U. S. Department of Veterans Affairs, Veterans Canteen Service (Docket No. R-S/01-6). This panel was convened by the U.S. Department of Education, under 20 U.S.C. 107d-1(b), after the Department received a complaint filed by the petitioner, the Alabama Department of Rehabilitation Services.

SUPPLEMENTARY INFORMATION:

Under section 6(c) of the Randolph-Sheppard Act (the Act), 20 U.S.C. 107d-2(c), 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 denial by the U.S. Department of Veterans Affairs (DVA), Veterans Canteen Service (VCS), of a request by the Alabama Department of Rehabilitation Services, the State licensing agency (SLA), to establish Randolph-Sheppard vending facilities at DVA Medical Centers in Alabama, in violation of the Act (20 U.S.C. 107 et seq.) and the implementing regulations in 34 CFR part 395.

A summary of the facts is as follows: In 1998 the SLA filed an arbitration complaint with the U.S. Department of Education. The SLA's complaint alleged that DVA/VCS had failed to comply with the provisions of the Act and implementing regulations regarding permit applications submitted by the SLA for four Federal properties maintained and operated by DVA/VCS. A Federal arbitration panel was convened to hear this matter and rendered a decision on October 20, 2000.

The panel ruled that DVA/VCS had not complied with the Act and implementing regulations regarding the establishment of Randolph-Sheppard vending facilities on Federal property. At the instruction of the arbitration panel, the SLA submitted to DVA/VCS, during the arbitration proceedings, permit applications requesting the establishment of blind vending facilities in 33 separate buildings located in Alabama. However, at the time of the SLA's filing of this second arbitration complaint, the SLA had not received a response to these requests.

Later, the SLA alleges that it learned DVA/VCS had contracted with private companies to operate vending machines on DVA/VCS property in Alabama subsequent to January 1, 1975, which is in violation of the Act and implementing regulations. Further, the SLA also contends that it has never received any disbursement of vending machine income from the operation of these vending machines operated by DVA/VCS on Federal property in violation of the income-sharing provisions of the Act and implementing regulations.

As a result of this dispute, the SLA requested the Secretary of Education to convene a Federal arbitration panel to hear this complaint. A panel was convened, and a hearing on this matter was held on April 23, 2002.

Arbitration Panel Decision

The arbitration panel heard the following three issues: (1) Whether DVA/VCS had violated the Act and implementing regulations by failing to take action necessary to carry out the decision of the arbitration panel in Alabama Department of Rehabilitation Services v. Department of Veterans Affairs, Veterans Canteen Service, Case No. R-S/98-7; (2) whether DVA/VCS' failure to approve or disapprove the applications for permits submitted by the SLA in March 2000 to establish vending facilities on Federal property in Alabama was in violation of the Act and implementing regulations; and (3) whether the operation of vending machines by private companies and the receipt of vending machine income from those machines by DVA/VCS without sharing a percentage of the income with the SLA was in violation of the income-sharing provisions of the Act and implementing regulations.

After considering the evidence presented, the panel made the following decision and award: Concerning the first issue, the panel concurred with the first arbitration panel's findings and award in Case No. R-S/98-7 in which that panel ruled that DVA/VCS had violated the Act. Therefore, the panel ruled that DVA/VCS should take all proper corrective action necessary.

Regarding the second issue, the majority of the panel ruled that DVA/VCS had failed to properly respond to the applications for permits submitted by the SLA in March 2000. Accordingly, the panel directed DVA/VCS to review, investigate, and determine which permit applications submitted by the SLA should have been approved and then to issue those permits. Also, the panel ordered DVS/VCS to determine the amount of monies lost as the result of its failure to timely grant and issue those permits and to compensate the SLA with interest at the lawful rate.

Finally, as to the third issue, the majority of the panel concluded that testimony showed that DVA/VCS performed every activity involved in the vending of beverages, thus establishing that DVA/VCS, not a private vending company, operated the vending machines. Therefore, the panel ruled that profits made by DVA/VCS were exempt from the vending machine income-sharing provisions of the Act as alleged by the SLA.

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.

FOR FURTHER INFORMATION CONTACT:

You may obtain a copy of the full text of the arbitration panel decision from Suzette E. Haynes, U.S. Department of Education, 400 Maryland Avenue, SW., room 3232, 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 alternative format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed in the preceding paragraph.

Electronic Access to This Document

You may view this document, as well as all other Department of Education documents published in the Federal Register, in text or Adobe Portable Document Format (PDF) on the Internet at the following site: www.ed.gov/​legislation/​FedRegister.

To use PDF you must have Adobe Acrobat Reader, which is available free at this site. If you have questions about using PDF, call the U.S. Government Printing Office (GPO), toll free, at 1-888-293-6498; or in the Washington, DC, area at [phone].

Note:

The official version of this document is the document published in the Federal Register. Free Internet access to the official edition of the Federal Register and the Code of Federal Regulations is available on GPO Access at: http://www.access.gpo.gov/​nara/​index.html.

Dated: June 13, 2003.

Robert H. Pasternack,

Assistant Secretary for Special Education and Rehabilitative Services.