[Federal Register Volume 76, Number 153 (Tuesday, August 9, 2011)]
[Notices]
[Pages 48831-48833]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-20231]


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DEPARTMENT OF EDUCATION


Arbitration Panel Decision Under the Randolph-Sheppard Act

AGENCY: Department of Education.

ACTION: Notice of arbitration panel decisions under the Randolph-
Sheppard Act.

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SUMMARY: The Department of Education (Department) gives notice that on 
May 3, 2010, and April 19, 2011, an arbitration panel rendered 
decisions in the matter of Art Stevenson v. Oregon Commission for the 
Blind, Case no. R-S/07-4. This panel was convened by the Department 
under 20 U.S.C. 107d-1(a), after the Department received a complaint 
filed by the petitioner, Art Stevenson.

FOR FURTHER INFORMATION CONTACT: You may obtain a copy of the full text 
of the arbitration panel decisions from Suzette E. Haynes, U.S. 
Department of Education, 400 Maryland Avenue, SW., Room 5022, Potomac 
Center Plaza, Washington, DC 20202-2800. Telephone: (202) 245-7374. If 
you use a telecommunications device for the deaf (TDD), call the 
Federal Relay Service (FRS), toll-free, at 1-800-877-8339.
    Individuals with disabilities can obtain this document in an 
accessible format (e.g., braille, large print, audiotape, or computer 
diskette) on request to the contact person listed under FOR FURTHER 
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: Under section 6(c) of the Randolph-Sheppard 
Act (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

    Art Stevenson (Complainant) alleged that the Oregon Commission for 
the Blind, the State licensing agency (SLA), violated the Act and its 
implementing regulations in 34 CFR part 395. Specifically, Complainant 
alleged that the SLA improperly administered the transfer and promotion 
policies and procedures of the Oregon Randolph-Sheppard Vending 
Facility Program in violation of the Act, implementing regulations 
under the Act, and State rules and regulations in Complainant's bid to 
manage the Marion County vending route comprised of vending machines at 
the Oregon Department of Public Safety Standards and Training (DPSST).
    On May 1, 2006, the SLA issued a vacancy announcement for the DPSST 
vending route. While the posting did not indicate that the DPSST campus 
would be closed, i.e., that trainees would not be permitted to return 
home on weekends, the SLA communicated this information at an early May 
meeting with the Blind Enterprise Consumer Committee, of which 
Complainant was a member. On May 20, 2006, the SLA informed Complainant 
that his bid had been accepted. On July 27, 2006, Complainant signed a 
vendor's operating agreement with the SLA to manage the DPSST vending 
route. Subsequently, on August 1, 2006, Complainant informed the SLA 
that he would continue to operate his current vending route in 
Multnomah County (Multnomah) until September 30, 2006.
    On August 10, 2006, staff of the SLA informed Complainant that the 
Multnomah vending route was being put out to bid. On August 22, 2006, a 
vacancy announcement was sent to all eligible vendors. Another vendor 
submitted the only bid for the Multnomah vending route and he was 
awarded the Multnomah vending route contract on September 6, 2006.

[[Page 48832]]

    On September 28, 2006, Complainant requested from the SLA a two-
week extension on relinquishing the Multnomah vending route to the new 
vendor, citing low sales figures for the DPSST vending route. The SLA 
agreed to the extension of Complainant's request to delay turning over 
the Multnomah vending route to the new vendor.
    At a meeting on October 3, 2006, a DPSST official informed the 
blind vendor and SLA for the first time that the DPSST had decided to 
operate the DPSST facility as an open campus in which trainees were 
allowed to go home on weekends. At the same time, the SLA learned that 
the DPSST cafeteria was selling items in competition with Complainant's 
vending machines.
    On October 4, 2006, Complainant filed a grievance with the SLA 
requesting an administrative review indicating that ``there are several 
issues that must be addressed before I relinquish my current status as 
the Multnomah County vending route manager.'' Following Complainant's 
request for an administrative review, staff of the SLA met with him and 
suggested alternatives to supplement Complainant's income at DPSST. 
However, Complainant declined the offer and requested that he be 
permitted to continue operating the Multnomah vending route. The SLA 
denied Complainant's request. However, Complainant continued to operate 
the Multnomah vending route until mid-2008. On June 13, 2008, SLA staff 
directed Complainant to turn over keys to the Multnomah vending route 
to the new vendor and Complainant complied with the SLA's request.
    Subsequently, Complainant filed for a State fair hearing. The SLA 
held a State hearing on this matter. The SLA adopted the hearing 
officer's decision to deny Complainant's request to continue operating 
the Multnomah vending route as final agency action. It is this decision 
on which Complainant sought review by a Federal arbitration panel.

Arbitration Panel Decisions

    After hearing testimony and reviewing all of the evidence, the 
panel majority ruled on May 3, 2010, that Complainant did not have the 
right to rescind the August 1, 2006, notice of termination of his 
operating agreement with the SLA for the Multnomah vending route. The 
panel majority concluded that the change in circumstances in the DPSST 
vending route was the result of DPSST's unilateral decision to open the 
campus. It was undisputed that DPSST decided to open the campus after 
the bidding ended and that it did not inform the SLA of this change 
until after the vendor complained of unexpected low earnings soon after 
he began operating the vending machines.
    Thus, according to the panel, the SLA was not responsible for the 
change simply because it occurred at the outset of the operation of the 
DPSST vending route instead of a month or a year into the operation. 
Moreover, based on information at the time of the bid, Complainant had 
no reasonable expectation that he would receive sufficient income from 
just servicing the DPSST vending route--especially since the vacancy 
announcement for DPSST informed bidders that additional vending would 
be a significant part of the DPSST vending route. Finally, when the SLA 
official became aware of the decision to open the campus, he 
immediately mitigated the impact by offering additional vending and 
also promptly objected upon learning that the cafeteria was selling 
similar items.
    The panel majority also ruled that Complainant was not entitled to 
be restored as the manager of the Multnomah vending route. This was 
based upon the finding that significant inequities would have ensued 
had Complainant been allowed to rescind his decision to relinquish the 
Multnomah vending route. By the time the SLA learned of DPSST's change 
to an open campus, the new vendor at the Multnomah vending route had 
already incurred significant cost to prepare to service the Multnomah 
vending route. Therefore, allowing Complainant to retain the Multnomah 
vending route would have caused real economic harm to the new vendor.
    Accordingly, the panel majority concluded that the SLA did not 
violate the Randolph-Sheppard Act. The panel majority denied 
Complainant's motion for summary judgment and granted the SLA's motion 
for summary judgment.
    One panel member dissented from the panel majority's decision 
stating that Complainant had a right to rescind his agreement to 
operate the Multnomah vending route. This panel member concluded that, 
if the SLA had acted upon Complainant's rescission request promptly, no 
additional harm would have occurred to Complainant or the other vendor. 
As a remedy, this panel member would have awarded damages in an 
appropriate amount to Complainant for the SLA's failure to rescind his 
agreement in a timely manner.
    On July 27, 2010, following the panel's submitting the final 
decision to the Department, Complainant submitted to the panel a 
Request for Reconsideration. However, the request did not identify any 
specific issues that remained to be addressed. After consultation, the 
panel requested by e-mail, dated August 2, 2010, that Complainant 
articulate the specific issues in his view that were within the panel's 
jurisdiction under the Randolph-Sheppard Act and identify remaining 
issues in light of the panel majority's ruling on May 3, 2010.
    On August 17, 2010, Complainant responded to the panel with a list 
of eleven issues. After reviewing the list, the panel majority 
concluded on April 19, 2011, that Complainant had not presented issues 
warranting further hearing in this matter. Specifically, the panel 
determined that it did not have jurisdiction to consider three of the 
issues because they had not been addressed at the State level first. 
For the remainder of the issues, the panel determined that they had 
either already been resolved or were moot. Therefore, Complainant's 
Request for Reconsideration was denied.
    One panel member dissented in part and concurred in part from the 
panel majority. This panel member dissented stating that Complainant 
had not waived his right to a hearing on the SLA's alleged 
inappropriate administration of the Randolph-Sheppard vending facility 
program regarding the DPSST vending route.
    The views and opinions expressed by the panel do not necessarily 
represent the views and opinions of the Department.
    Electronic Access to This Document: 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 via the Federal Digital System 
at: http://www.gpo.gov/fdsys. At this site you can view this document, 
as well as all other documents of this Department published in the 
Federal Register, in text or Adobe Portable Document Format (PDF). To 
use PDF you must have Adobe Acrobat Reader, which is available free at 
this site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at http://www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.


[[Page 48833]]


    Dated: August 4, 2011.
Alexa Posny,
Assistant Secretary for Special Education and Rehabilitative Services.
[FR Doc. 2011-20231 Filed 8-8-11; 8:45 am]
BILLING CODE 4000-01-P