[Federal Register: December 23, 2008 (Volume 73, Number 247)]
[Page 78754-78755]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]

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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 of Education (Department) gives notice that on 
August 20, 2008, an arbitration panel rendered a decision in the matter 
of Dwayne Zuppardo v. Louisiana Department of Social Services, 
Rehabilitation Services, Case no. R-S/06-5. 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, Dwayne Zuppardo.

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 under FOR FURTHER 

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 


    Mr. Dwayne Zuppardo (Complainant) alleged violations by the 
Louisiana Department of Social Services, Rehabilitation Services, the 
state licensing agency (SLA), of the Act and the implementing 
regulations in 34 CFR part 395. Specifically, Complainant alleged that 
the SLA improperly administered the Randolph-Sheppard Vending Facility 
Program concerning his management of a snack bar in the East Pavilion 
of Charity Hospital (Charity Hospital) in New Orleans, Louisiana. From 
November 1991 until March 2004, Complainant managed the snack bar. In 
March 2004, the snack bar at Charity Hospital was closed. In April 
2004, Complainant sent a letter to the SLA requesting a determination 
as to whether he should be treated as a Displaced Manager rather than 
being given another vending facility in the main building of Charity 
Hospital. The SLA denied Complainant's request for a determination on 
his Displaced Manager status. Thereafter, Complainant requested a state 
fair hearing. A hearing was held on this matter.
    In June 2004, the Administrative Law Judge (ALJ) issued an opinion 
supporting Complainant's right to the new vending facility in the main 
building of Charity Hospital. The SLA

[[Page 78755]]

did not appeal and adopted the ALJ's decision. Following the ALJ's 
opinion, Complainant also alleged that the opinion required the SLA to 
pay him for his lost income at his former snack bar facility until he 
was placed as the manager of the new vending facility in the main 
building of Charity Hospital.
    For the period of November 1991 until July 1997, while managing the 
snack bar, Complainant made monthly utility payments, each in the 
amount of $2,000, to Charity Hospital as directed by the SLA. While 
there was no requirement for Complainant to make these payments under 
his Vendor Operating Agreement with the SLA, the permit agreement to 
operate the snack bar between the SLA and Charity Hospital contained a 
requirement that the SLA would pay Charity Hospital for utilities at 
the rate of $2,000 per month.
    In March 2005, Complainant learned that the SLA had reimbursed the 
previous operator of the snack bar for his utility payments to Charity 
Hospital. At this time, Complainant believed that he also was entitled 
to reimbursement by the SLA of his utility payments to Charity 
Hospital. Additionally, Complainant believed that the SLA should 
reimburse him for loss of income when the snack bar was closed.
    On May 27, 2005 Complainant filed a request with the SLA to bypass 
the administrative review process and proceed with a state fair hearing 
on the issues of reimbursement for utility payments to Charity Hospital 
and loss of income as the result of the snack bar closure. On June 10, 
2005, the Administrative Law Judge Supervisor denied Complainant's 
hearing request, citing time limitations for vendors to file for a 
hearing with the SLA.
    It was this decision Complainant sought review of by a Federal 
arbitration panel. Due to Hurricane Katrina, a hearing on this matter 
was not held until April 26, 2007.
    According to the arbitration panel, the issues to be resolved were 
as follows: (1) Whether the Complainant is entitled to reimbursement 
for utility payments paid to Charity Hospital while he operated the 
snack bar; and (2) whether Complainant is entitled to recover lost 
earnings from the time his snack bar was closed in March 2004 until he 
was given a new vending facility in September 2004.

Arbitration Panel Decision

    After reviewing all of the records and hearing testimony of 
witnesses, the panel majority ruled as follows: On issue number one, 
the panel found that the SLA was obligated to treat Complainant in the 
same manner as the previous snack bar manager when it reimbursed the 
previous snack bar manager for utility payments paid to Charity 
Hospital. Thus, the panel majority directed that the SLA promptly pay 
Complainant the sum of $138,000 as reimbursement for utility payments 
Complainant paid to Charity Hospital while he was the licensed manager 
at the snack bar facility for the period November 1991 to March 2004.
    Regarding issue number two, the panel majority ruled that the SLA 
complied with the June 2004 ruling of the ALJ and expeditiously 
provided Complainant with a new vending facility in the main building 
of Charity Hospital. However, the panel majority concluded that the 
ALJ's ruling did not require the SLA to pay the Complainant for lost 
earnings from the time he was displaced from the snack bar facility 
until the time he began to manage the new facility. Hence, the panel 
majority denied Complainant's claim on the merits, ruling that there 
was no basis for the SLA to pay Complainant for lost earnings from the 
time when the snack bar facility closed until he was placed in the new 
vending facility.
    One panel member concurred in part and dissented in part. The panel 
member dissented from the panel majority on issue number one stating 
that, ``the imposition of fees for utility service upon blind vendors 
is not prohibited by either state for federal law.'' The panel member 
concurred with the panel majority on issue number two in denying the 
payment of lost earnings to Complainant.
    The views and opinions expressed by the panel do not necessarily 
represent the views and opinions of the Department.

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 18, 2008.
Tracy R. Justesen,
Assistant Secretary for Special Education and Rehabilitative Services.
 [FR Doc. E8-30551 Filed 12-22-08; 8:45 am]