FR Doc E6-20680
[Federal Register: December 6, 2006 (Volume 71, Number 234)]
[Page 70747-70748]
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 March 30, 2006, an 
arbitration panel rendered a decision in the matter of Gary DeFalco v. 
Nevada Department of Employment, Training and Rehabilitation (Docket 
No. R-S/05-2). This panel was convened by the U.S. Department of 
Education, under 20 U.S.C. 107d-1(a), after the Department received a 
complaint filed by the complainant, Gary DeFalco.

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 5022, Potomac 
Center Plaza, Washington, DC 20202-2800. Telephone: (202) 245-7374. If 
you use a telecommunications device for the deaf (TDD), you may call 
the Federal Relay Service (FRS) at 1-800-877-8339.
    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 

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 concerned alleged violations of the Act (20 U.S.C. 107 
et seq.), the implementing regulations in 34 CFR part 395, and State 
rules and regulations by the Nevada Department of Employment, Training 
and Rehabilitation concerning complainant's management of Facility 
43, a vending machine route.
    A summary of the facts is as follows: Complainant has been a 
licensed vendor in the Nevada Department of Employment, Training and 
Rehabilitation's Randolph-Sheppard vending facility program since 1987. 
On January 29, 2002, complainant filed a grievance with the Nevada 
Department of Employment, Training and Rehabilitation, the State 
licensing agency (SLA), alleging that the SLA--(1) denied his right as 
the Southern Nevada Representative to manage a vending facility at the 
Las Vegas Water District; (2) denied his right as the Southern Nevada 
Representative to manage a vending site at the Las Vegas Department of 
Energy Support Facility; (3) denied his right as the Southern Nevada 
Representative to service all vending sites in southern Nevada since 
May 1999; and (4) placed him on a corrective action plan concerning his 
alleged improper management of Facility 43 prior to his 
receiving a notice of non-compliance from the SLA or being given the 
opportunity for corrective action. On February 15, 2002, the SLA 
rejected complainant's four grievances.

[[Page 70748]]

    Subsequently, complainant filed for a State fair hearing with the 
SLA. A hearing on this matter was held on May 22 and June 19, 2002. On 
April 11, 2003, the hearing officer affirmed that complainant failed to 
establish any violations by the SLA regarding complainant's four 
grievances and the SLA's administration of the Nevada Randolph-Sheppard 
vending facility program. However, the hearing officer ruled that the 
complainant should not be responsible for the lease payments for his 
business vehicle for Facility 43 while a vending company 
serviced his vending route. The SLA adopted the hearing officer's 
decision as final agency action. The complainant sought review of that 
decision by a Federal arbitration panel.

Arbitration Panel Decision

    After reviewing all of the records and hearing testimony of 
witnesses, the panel majority ruled that--(1) The complainant was never 
appointed the Southern Nevada Representative and, therefore, had no 
first right of refusal for new vending routes in southern Nevada; (2) 
because the complainant completed all of the requirements of the 
corrective action plan, the SLA must place him back to work either into 
his previous position or in a suitable route but that there should be 
no damages because his net compensation during the time he was removed 
from the route had not diminished; (3) the SLA had fulfilled the order 
of the State hearing officer by paying for lease and insurance payments 
on complainant's vehicle because the complainant had been deducting 
these expenses from the set-aside normally paid to the SLA; (4) the 
loaning of start-up funds to the vendor by the SLA was not in violation 
of the Act; and (5) the arbitration hearing was not the proper venue 
for allegations that one of the panel members should have recused 
himself from the panel.
    One panel member dissented from one of the panel's rulings--that 
the SLA should return the complainant to his previous vending route or 
a similar vending route--based upon the belief that an arbitration 
panel does not have the authority to specify an award to the vendor 
even when a violation of the Act has been found.
    One panel member dissented from the entirety of panel's decision 
with the exception of the panel's ruling that the SLA should return the 
complainant to his previous vending route or a similar vending route.
    The views and opinions expressed by the panel do not necessarily 
represent the views and opinions of the U.S. Department of Education.

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: December 1, 2006.
John H. Hager,
Assistant Secretary for Special Education and Rehabilitative Services.
 [FR Doc. E6-20680 Filed 12-5-06; 8:45 am]