FR Doc 03-2315
[Federal Register: January 31, 2003 (Volume 68, Number 21)]
[Page 5009-5010]
From the Federal Register Online via GPO Access []

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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 November 30, 2001, an 
arbitration panel rendered a decision in the matter of California 
Department of Rehabilitation Services v. United States Postal Service 
(Docket No. R-S/00-4). 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 petitioner, the California 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 


    This dispute concerns the alleged improper denial by the United 
States Postal Service (USPS) of the request of the California 
Department of Rehabilitation Services, the State licensing agency 
(SLA), to establish a Randolph-Sheppard vending facility at the Long 
Beach Processing and Distribution Center in Long Beach, California, in 
violation of the satisfactory site provisions 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 February 1997, the SLA 
submitted a proposal to USPS to establish a Randolph-Sheppard vending 
facility by combining the food service facility at the Long Beach 
Processing and Distribution Center with nine satellite locations. A 
permit agreement was entered into between the SLA and USPS. In reliance 
upon the signed permit agreement, the SLA purchased vending machines 
and other equipment in the amount of $181,000. Additionally, a blind 
vendor was assigned to the vending facility and route. The blind vendor 
invested in storage space and hired an assistant to help him service 
the vending route.
    In September 1997, the Manager for Corporate Personnel Management 
at USPS Headquarters in Washington, DC, became aware of the permit 
agreement with the SLA to provide food service at the Long Beach 
Processing and Distribution Center and the nine satellite locations. 
Subsequently, USPS asserted that the permit agreement violated USPS 
policies concerning the establishment of vending services operated by 
the blind. According to USPS, the blind vendor had to be physically 
present at each vending route where food service was being provided. In 
the absence of having a blind vendor present at each location, USPS 
required that the SLA pay USPS $8,400 in service fees. The SLA objected 
to the payment of service fees and to the directive from USPS 
Headquarters to terminate the satellite vending routes as a violation 
of the terms of the permit agreement signed by the SLA and USPS.
    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 May 4, 2001.

Arbitration Panel Decision

    After considering the evidence presented, the panel concluded that 
USPS had entered into a permit agreement with the SLA in February 1997. 
The panel further determined that the permit agreement at the Long 
Beach Processing and Distribution Center

[[Page 5010]]

provided for a main vending facility and nine satellite vending routes. 
The panel rejected the explanation of USPS for terminating the permit 
agreement and ruled that the termination was in violation of the 
Randolph-Sheppard Act for a number of reasons. First, the panel found 
that the Act does not prohibit vending routes where blind vendors are 
not regularly onsite at each location. Secondly, the panel found that 
having an onsite requirement only for blind vendors and not for 
commercial vendors was not supported by a reading of the Act. 
Therefore, the panel concluded that USPS could not unilaterally 
withdraw its participation in a vending facility permit agreement as 
this was a violation of the Randolph-Sheppard Act, 20 U.S.C. 107 et 
seq., and the implementing regulations in 34 CFR part 395.
    The panel directed USPS to pay damages as established by the SLA 
and the blind vendor. The panel retained jurisdiction concerning the 
matter of payment of damages.
    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: (202) 205-8536. 
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 

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:
    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 (202) 512-1530.

    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:

    Dated: January 28, 2003.
Robert H. Pasternack,
Assistant Secretary for Special Education and Rehabilitative Services.
[FR Doc. 03-2315 Filed 1-30-03; 8:45 am]