[Federal Register Volume 59, Number 142 (Tuesday, July 26, 1994)] [Unknown Section] [Page 0] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 94-18161] [[Page Unknown]] [Federal Register: July 26, 1994] ----------------------------------------------------------------------- DEPARTMENT OF EDUCATION 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 November 29, 1990, an arbitration panel rendered a decision in the matter of Dennis Franklin v. Kentucky Department for the Blind, (Docket No. R-S/89-5). This panel was convened by the Secretary of the U.S. Department of Education pursuant to 20 U.S.C. 107d-1(a), upon receipt of a complaint filed by petitioner, Dennis Franklin, on January 17, 1989. The Randolph-Sheppard Act provides a priority for blind individuals to operate vending facilities on Federal property. Under this section of the Randolph- Sheppard Act (the Act), a blind licensee dissatisfied with the State's operation or administration of the vending facility program authorized under the Act may request a full evidentiary fair hearing from the State licensing agency (SLA). If the licensee is dissatisfied with the State agency's decision, the licensee may complain to the Secretary, who then is required to convene an arbitration panel to resolve the dispute. FOR FURTHER INFORMATION CONTACT: 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, S.W., Room 3230, 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. SUPPLEMENTARY INFORMATION: Pursuant to the Randolph-Sheppard Act (20 U.S.C. 107d-2(c)), the Secretary publishes a synopsis of arbitration panel decisions affecting the administration of vending facilities on Federal property. Background The complainant, Dennis Franklin, is a blind vendor licensed by the respondent, the Kentucky Department for the Blind, pursuant to the Randolph-Sheppard Act, 20 U.S.C. 107 et seq. The Department is the SLA responsible for the operation of the Kentucky vending facility program for blind individuals. The purpose of the program is to establish and support blind vendors operating vending facilities on Federal property. Mr. Franklin operated a vending facility from 1977 until 1987 at the Gardner Lane Postal Facility in Louisville, Kentucky. This was pursuant to a permit between the SLA and the U.S. Postal Service, which was supplemented by a food service contract between the SLA and the Postal Service. During 1985, complaints about the food service and Mr. Franklin's management surfaced. In both July and October 1985, the U.S. Postal Service specifically requested the removal of the vendor. Complaints cited poor attitude, empty vending machines, outdated food products, dirty tables, and lack of service. On July 17, 1985, the Postal Service threatened to terminate the supplemental food service contract with the SLA unless strong corrective actions were taken. Meetings throughout August and September 1985 indicated improvement and a partial resolution. In October 1985, however, an incident involving an alleged physical altercation led to the Postal Service requesting that the vendor be subject to disciplinary action for serious misconduct. Additional complaints were documented on January 17, 1986. In a February 4, 1986, letter to the vendor, the SLA notified him of its dissatisfaction with his performance of duties in operating the Gardner Lane vending facility and the receipt of repeated complaints by postal service patrons, which were probable cause for finding a violation of the operator agreement. Additional complaints were received during the next several months. In October 1986, two union representatives from the Postal Service wrote to voice strong dissatisfaction with the food service and Mr. Franklin's management. On June 26, 1987, Mr. Franklin received a letter from the SLA terminating his agreement effective July 27, 1987. On July 14, 1987, Mr. Franklin requested an administrative review, which was conducted by the SLA on July 28th. A decision was rendered by the reviewing officer confirming the decision of the SLA to terminate Mr. Franklin's operator's agreement. On July 27th, complainant filed a Motion for Preliminary Injunction in U.S. District Court for the Western District of Kentucky, and the SLA decided to delay termination of the vendor's operator's agreement until an order was issued by the Court. On September 9, the court conducted a hearing and on September 28 rendered its decision denying the vendor's request for injunction, citing that there was little likelihood of the vendor prevailing on the merits of the case. On October 1, 1987, the SLA formally terminated the operator's agreement with the complainant; however, his license was not revoked. The SLA granted Mr. Franklin continued seniority up through October 1. Subsequently, Mr. Franklin requested a full evidentiary hearing, which was held on January 20, February 4, and February 16, 1988. The hearing officer issued an opinion on March 30, 1988, indicating that the SLA's decision to terminate the agreement was justified by Mr. Franklin's failure to revise his operating procedures. On April 4, 1988, the complainant was notified by the SLA that the hearing officer's decision was being adopted as final agency action. In addition, on June 9, 1988, Mr. Franklin requested an evidentiary hearing on several grievances concerning his failure to be appointed an assistant manager or manager for vending facilities up for bid by the SLA. On August 31, 1988, an evidentiary hearing was conducted, and on November 23, the hearing officer issued a decision finding that complainant had not been discriminated against regarding his bid application for two locations that he did not receive. On January 17, 1989, the complainant filed a request with the Secretary of Education concerning an appeal of these issues, which were consolidated for an arbitration hearing scheduled for November 14 and 15, 1989. Arbitration Panel Decision The central issues that the arbitration panel reviewed were--(1) Whether the SLA followed its rules and regulations when it rescinded the complainant's operator's agreement and removed him from the Gardner Lane Post Office pursuant to 20 U.S.C. 107a(b) and 34 CFR 395.36; and (2) Whether the SLA adhered to proper procedures in the administration of its transfer and promotion policies concerning the complainant's bids on vendor openings in the program pursuant to 20 U.S.C. 107b- 1(3)(c) and 34 CFR 395.7(c). The arbitration panel concluded that the problems at the Gardner Lane Post Office were well documented beginning in 1985 with intensive involvement by the SLA in attempts to resolve the matters. On two occasions in 1985, the problems resulted in a request from postal officials for the removal of the complainant regarding alleged mismanagement and lack of customer satisfaction, including a threatened boycott of the vending facility by postal union employees in 1986 and culminating in 1987 with the SLA's possible loss of the Gardner Lane facility. The arbitration panel held that the SLA acted properly and for just cause in removing the complainant from the Gardner Lane Post Office facility. The vendor had more than adequate notice of his performance deficiencies from the complaints, meetings, and reviews that had previously taken place. The SLA fulfilled its responsibilities to assist the vendor in working out the problems with the Federal property managers; however, the complainant failed to reform his business practices to satisfactorily continue to manage the vending facility. The panel concluded that the SLA acted improperly in denying the vendor his profits for the period prior to the full evidentiary hearing. A vendor's earnings are protected during any proceeding against a vendor's license. Although no action was taken to revoke Mr. Franklin's license, the State and Federal regulations indicate a policy that a vendor's employment will remain protected until a full hearing on charges is held, absent a suspension of the vendor from the facility and subsequent termination. Also, the panel held the SLA liable for lost profits for the period from his removal until the State hearing officer's opinion was rendered. The panel also ordered a further investigation and review for the accounting of profits that had been paid to the vendor during a short period after he had been removed from the Gardner Lane Post Office facility. The record provided at the hearing did not adequately reconcile end-of-year discrepancies in accounting. The SLA will review documents and share findings with complainant. The panel rejected the vendor's claim that he had been improperly denied certain positions for which he bid. Seniority is only one factor to be considered. The panel raised concerns, however, that the vendor not be blacklisted from employment. The vendor will continue to remain licensed to manage a facility. Also, the panel rejected the vendor's claim for attorney's fees, finding authority for such an award to be ambiguous. Panel Members Gashel and Davis concurred in the majority opinion and filed separate dissenting opinions on certain issues. The views and opinions expressed by the panel do not necessarily represent the views and opinions of the U.S. Department of Education. Dated: July 21, 1994. Judith E. Heumann, Assistant Secretary for Special Education and Rehabilitative Services. [FR Doc. 94-18161 Filed 7-25-94; 8:45 am] BILLING CODE 4000-01-P