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Arbitration Panel Decision Under the Randolph-Sheppard Act

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Department of Education.


Notice of arbitration panel decision under the Randolph-Sheppard Act.


The Department gives notice that on November 9, 2004, an arbitration panel rendered a decision in the matter of Arland Stratton v. Illinois Department of Human Services, Office of Rehabilitation Services (Docket No. R-S/03-1). 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 petitioner, Arland Stratton.

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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 paragraph.

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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 property.


This dispute concerns the alleged improper termination of Mr. Arland Stratton's vending license as a blind licensee under the Randolph-Sheppard vending facility program by the Illinois Department of Human Services, Office of Rehabilitation Services, the State licensing agency (SLA), in violation of the Act (20 U.S.C. 107 et seq.), the implementing regulations in 34 CFR part 395, and State rules and regulations.

A summary of the facts is as follows: Mr. Arland Stratton (complainant) operated Vending Facility #451 (Facility #451) at the Illinois Prairie Rest Area, I-57 in Champaign, Illinois, until April 1, 2002, when his vending license was terminated.

Previously, on March 28, 2002, complainant alleged that he reported to his business counselor at the SLA during the counselor's onsite visit to Facility #451 that a possible bookkeeping error may have resulted in his using program assets for personal use. Upon complainant's disclosure of the alleged bookkeeping error, the business counselor informed the SLA's Director of the Business Enterprise Program (BEP). The Director of the BEP instructed the business counselor to do a complete inventory of Facility #451 and to remove the keys from complainant's possession.

Complainant further alleged that the SLA's termination of his vending operator's license and removal from Facility #451 occurred without first providing him with an opportunity for a full evidentiary hearing, in violation of the Act and implementing regulations.

The SLA alleged that complainant, as a blind vendor, had been licensed, trained, and certified in the operation and management of vending facilities in the Illinois BEP. The SLA also stated that complainant was aware of the policies governing vending facilities and, in particular, the rules concerning use of program funds for personal use.

The SLA further alleged that in August 2001 the complainant's business counselor found him to be deficient in financial management practices and his paperwork to be unorganized. In January 2002, complainant received a written reprimand for a second violation of a State rule regarding accounting procedures. On March 19, 2002, the complainant's business counselor scheduled a financial audit. At the time of the audit, the business counselor alleged that complainant provided incomplete and incorrect paperwork, and the vendor was given one week to provide all of the correct information.

Following termination of his vending license, complainant filed for an administrative hearing. The hearing was held on June 10, 2002. In a decision dated July 8, 2002, the hearing officer affirmed the SLA's decision to terminate complainant's vending license and removal from Facility #451. The SLA adopted the hearing officer's decision as final agency action, and complainant sought review of that decision by a Federal arbitration panel.

Arbitration Panel Decision

The issues heard by the panel were: (1) Did the SLA violate 20 U.S.C. 107 et seq., the implementing regulations in 34 CFR part 395, and its own regulations in allegedly improperly terminating the vendor's operating license and removing him from Facility #451, and (2) Did the SLA violate Federal law by removing the complainant as the vendor of Facility #451 and terminating his license before providing him with a full evidentiary hearing in those decisions?

After reviewing all of the records and hearing testimony of witnesses, the panel ruled as follows: On the first issue, the panel ruled that the Federal regulations in 34 CFR 395.7(b) provide for the termination of a vendor's license after an SLA has afforded the vendor a full evidentiary hearing and must be applied as written. The panel concluded that a vendor's license could not be terminated before a State fair hearing was held. However, the panel noted that the SLA's authority to remove complainant from his facility was not in question as distinguishable from terminating his vending license.

Concerning the second issue, the panel ruled that the termination of complainant's vending license was not consistent with the rehabilitative purposes of the Act to provide training and additional services to blind licensees.

Finally, the panel was divided on the appropriate remedy. The majority of the panel ruled that complainant's license must be restored, and, upon successful completion of a retraining program, complainant was to be placed in a suitable location with provisions for follow-up supervision and training by the SLA. The panel further ruled that, since the SLA had not previously collected the outstanding debt from complainant, it should be forgiven allowing him to begin anew.

One panel member concurred with the majority decision on the finding of a violation but dissented in part regarding the appropriate remedy, believing that complainant was entitled to lost wages, compensatory relief, and attorney's fees. Start Printed Page 44593

The views and opinions expressed by the panel do not necessarily represent the views and opinions of the U.S. Department of Education.

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Dated: July 28, 2005.

John H. Hager,

Assistant Secretary for Special Education and Rehabilitative Services.

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[FR Doc. 05-15284 Filed 8-2-05; 8:45 am]