[Federal Register: February 16, 1999 (Volume 64, Number 30)]
[Page 7635-7636]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]



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 May 18, 1998, an arbitration 
panel rendered a decision in the matter of Georgia Middendorf v. 
Washington State Department of Services for the Blind (Docket No. R-S/
96-8). This panel was convened by the U.S. Department of Education 
pursuant to 20 U.S.C. 107d-1(a), upon receipt of a complaint filed by 
petitioner, Georgia Middendorf.

FOR FURTHER INFORMATION: A copy of the full text of the arbitration 
panel decision may be obtained from George F. Arsnow, U.S. Department 
of Education, 600 Maryland Avenue, S.W., Room 3230, Mary E. Switzer 
Building, Washington, D.C. 20202-2738. Telephone: (202) 205-9317. 
Individuals who use a telecommunications device for the deaf (TDD) may 
call the TDD number at (202) 205-8298.
    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 

Electronic Access To This Document

    Anyone may view this document, as well as all other Department of 
Education documents published in the Federal Register, in text or 
portable document format (pdf) on the World Wide Web at either of the 
following sites:


To use the pdf you must have the Adobe Acrobat Reader Program with 
Search, which is available free at either of the previous sites. If you 
have questions about using pdf, call the U.S. Government Printing 
Office toll free at 1-888-293-6498.
    Anyone may also view these documents in text copy only on an 
electronic bulletin board of the Department. Telephone: (202) 219-1511 
or, toll free, 1-800-222-4922. The documents are located under Option 
G--Files/Announcements, Bulletins and Press Releases.

    Note: The official version of a document is the document 
published in the Federal Register.

SUPPLEMENTARY INFORMATION: Pursuant to the Randolph-Sheppard 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.


    This dispute concerns the alleged improper termination of Georgia 
Middendorf's operator license by the Washington State Department of 
Services for the Blind, the State licensing agency (SLA). In 1981, 
following training with the SLA's Business Enterprise Program, 
complainant operated a dry stand in Seattle, Washington. Later that 
year, Ms. Middendorf began operating a cafeteria in the county 
courthouse in Everett, Washington. Complainant operated this facility 
for four years before resigning due to personal problems.
    Subsequently, complainant operated a snack bar vending facility in 
a State building in Olympia, Washington for four years. In 1989, Ms. 
Middendorf resigned as the result of friction between the building 
management and some members of her staff. In 1991, Ms. Middendorf was 
licensed to operate a snack bar and espresso cart in the County-City 
Building located in Tacoma, Washington. Difficulties and concerns in 
the management of the operation were identified by the building 
management and the SLA, but these issues improved late in 1991. At the 
close of 1991, complainant's husband was diagnosed with a terminal 
illness and subsequently died in 1992. During this period of time, the 
quality of service and cleanliness declined dramatically at the snack 
bar and espresso cart operation, and the SLA counseled Ms. Middendorf 
concerning the need to improve the quality of service. Complainant was 
not receptive. In 1993, Ms. Middendorf resigned.
    In August 1995, complainant was the sole bidder for a cafeteria 
vending facility at the Social Security Administration (SSA) in Auburn, 
Washington. The SLA awarded the contract to Ms. Middendorf pursuant to 
its rules and regulations as she was the only eligible bidder.
    The SLA, SSA, and General Services Administration (GSA), the 
property managing agency, made a concerted effort to assist Ms. 
Middendorf in succeeding in the operation of the SSA cafeteria. 
However, increasing complaints from the patrons concerning both the 
food and cleanliness prompted both GSA and SSA to complain to the SLA.
    The SLA responded by devising a corrective action plan with the 
goal of

[[Page 7636]]

assisting the complainant in addressing such issues as better food 
preparation and improved appearance, demeanor, and attitude of 
complainant and her staff. Complainant agreed to the corrective action 
plan, but it was never implemented.
    In November 1995, GSA and SSA demanded that Ms. Middendorf be 
removed from the operation of the cafeteria based upon her 
unsatisfactory performance. On November 30, GSA and SSA met with the 
SLA and the complainant. GSA and SSA requested the immediate 
resignation of complainant. Ms. Middendorf refused, and GSA cancelled 
the SLA's permit to operate the cafeteria.
    The SLA protested the cancellation of its permit and indicated to 
GSA its plan to request arbitration of the matter. Subsequently, GSA 
withdrew cancellation of the SLA's permit. The SLA resumed operation of 
the cafeteria. However, under the settlement agreement, complainant was 
not allowed to return.
    On January 23, 1996, the Director of the SLA met with complainant. 
She was advised in writing of the deficiencies in her operation and 
complainant was informed that unless she would undertake a six-month 
training program, the SLA would cancel her license. Complainant 
rejected the SLA's proposal. The SLA then cancelled Ms. Middendorf's 
    Ms. Middendorf requested and received a State evidentiary fair 
hearing on April 18, 1996. On April 30, the Administrative Law Judge 
(ALJ) sustained the cancellation of complainant's license. It was this 
final agency action that Ms. Middendorf sought to have reviewed by a 
Federal arbitration panel. A Federal arbitration of this matter was 
held on June 19 and 20, 1997.

Arbitration Panel Decision

    The issue before the arbitration panel was whether the Washington 
State Department of Services for the Blind acted properly and within 
the scope of its authority under the Randolph-Sheppard Act and 
implementing regulations in revoking Georgia Middendorf's operator 
    A majority of the panel concluded that, while the SLA needs to be 
proactive in assisting vendors under the program to avoid the kind of 
complaints about service and sanitation that existed at the SSA 
cafeteria, the SLA acted within the scope of its authority in 
terminating complainant's license.
    One panel member dissented from the majority opinion.
    The views and opinions expressed by the panel do not necessarily 
represent the views and opinions of the U.S. Department of Education.

    Dated: November 17, 1998.
Judith E. Heumann,
Assistant Secretary for Special Education and Rehabilitative Services.
[FR Doc. 99-3627 Filed 2-12-99; 8:45 am]