[Federal Register: June 15, 2001 (Volume 66, Number 116)]
[Page 32610-32611]
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 October 20, 2000, an 
arbitration panel rendered a decision in the matter of Alabama 
Department of Rehabilitation Services v. Department of Veterans 
Affairs, Veterans Canteen Service (Docket No. R-S/98-7). 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 petitioner, the Alabama 
Department of Rehabilitation Services.

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, 400 Maryland Avenue, SW., room 3230, Mary E. Switzer 
Building, Washington, DC 20202-2738. Telephone: (202) 205-9317. If you 
use a telecommunications device for the deaf (TDD), you may call the 
TDD number at (202) 205-8298.
    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 

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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.


    This dispute concerns the alleged violation by the Department of 
Veterans Affairs (DVA), Veterans Canteen Service (VCS), of the priority 
provisions of the Act (20 U.S.C. 107 et seq.) and implementing 
regulations in 34 CFR part 395 at DVA/VCS Medical Centers in Alabama.
    A summary of the facts is as follows: In 1995, the Alabama 
Department of Rehabilitation Services, the State licensing Agency 
(SLA), submitted permit applications to establish Randolph-Sheppard 
vending facilities on four Federal properties maintained and operated 
by DVA and VCS in Alabama. The permits were for the Veterans 
Administration Medical Center, Tuskegee; the Regional Office and DVA 
Medical Center, Montgomery; the Veterans Hospital, Birmingham; and the 
Veterans Administration Hospital, Tuscaloosa.
    By letter dated July 11, 1996, DVA acknowledged receipt of the 
permit applications and informed the SLA that a decision would be made 
after a review had been conducted to determine whether there were any 
plans to acquire, occupy, or otherwise engage in any substantial 
alterations or renovations of the involved buildings. The SLA did not 
receive any further communication from DVA or VCS until March 4, 1998. 
On that date, DVA wrote to the SLA advising that the Montgomery and 
Tuskegee facilities did not plan any construction that would require 
notice to the SLA and indicating that there was no suitable existing 
space available for the location of blind vending facilities at those 
centers. The letter informed the SLA that the hospitals at Birmingham 
and Tuscaloosa planned substantial alterations and renovations. The DVA 
forwarded the SLA's applications for permits at these hospitals to the 
directors of those facilities.
    Following receipt of DVA's March 4th letter, representatives of the 
SLA met with the Directors or their designees of the DVA Medical 
Centers located in Birmingham and Tuscaloosa. On May 21, 1998, the SLA 
wrote each Director asking for a response to the applications that had 
been pending since 1995. The SLA did not receive any response and in 
June 1998 filed with the Department of Education a request for 
arbitration of the matter.
    In July 1998, the Tuscaloosa Director notified the SLA that DVA/VCS 
intended to occupy a building that might contain a satisfactory site 
for the establishment of a vending location for a blind vendor. On July 
20, 1998, the SLA responded that it would send a representative to 
develop a site specific survey. In September 1998, the attorney for the 
SLA contacted the attorney for DVA and requested a meeting to negotiate 
a resolution to the issues.
    In a letter dated November 9, 1998, the DVA denied the SLA's second 
application filed in August 1998 to establish vending locations at the 
Tuscaloosa facility. Based upon information that the average income for 
its blind vendors was $25,000, the SLA previously had determined that 
it would take $100,000 in gross sales at the Tuscaloosa facility to 
provide a net income of $25,000 for a blind vendor. In the letter, the 
DVA indicated to the SLA that the $100,000 gross sales requirement for 
a possible vending location at the Tuscaloosa facility would include 
practically all of the gross sales, and the DVA would not give up the 
    The SLA notified the Department of Education by letter dated 
December 8, 1998 that no decision had been issued by DVA on its request 
to establish vending facilities at the DVA Medical Centers. Therefore, 
the SLA requested that the arbitration should proceed. A hearing on 
this matter was held on January 11-12, 2000.

Arbitration Panel Decision

    The central issue before the arbitration panel was whether DVA/
VCS's determination that no existing suitable space was available for 
blind vending facilities at DVA's Montgomery and Tuskegee locations and 
the failure of DVA's Medical Directors at the Birmingham and Tuscaloosa 
locations to approve the permit applications for blind vending 
facilities were contrary to and in violation of the Randolph-Sheppard 
Act, 20 U.S.C. 107 et seq., and the implementing regulations in 34 CFR 
part 395.
    The arbitration panel found that DVA/VCS did not comply with the 
Act in processing the SLA's 1995 permit 1 applications. Nor did DVA/VCS 
give reasons for its denial of permits at the Montgomery and Tuskegee 
Medical Centers as required by the Act and regulations in 34 CFR 
    The panel also concluded that, at the Tuscaloosa and Birmingham 
locations, DVA/VCS did not provide the SLA with timely notice of the 

[[Page 32611]]

renovations at these sites as required by the Act and implementing 
regulations in 34 CFR 395.31(c). Furthermore, during the renovations at 
the Birmingham and Tuscaloosa Medical Centers, DVA/VCS failed to 
provide the SLA with access to the facilities, personnel numbers, or 
financial data pertaining to the vending operations, as required by the 
Act, to determine if a suitable site existed.
    Therefore, for the previously stated reasons, the arbitration panel 
ruled that DVA/VCS had violated the Randolph-Sheppard Act. However, the 
panel stated that it did not have the authority to prescribe remedies. 
It noted that DVA/VCS' current position is that it is presently in 
compliance with the Randolph-Sheppard Act.
    The views and opinions expressed by the panel do not necessarily 
represent the views and opinions of the U.S. Department of Education.

    Dated: June 12, 2001.
Francis V. Corrigan,
Deputy Director, National Institute on Disability and Rehabilitation 
[FR Doc. 01-15153 Filed 6-14-01; 8:45 am]