[Senate Report 106-173]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 303
106th Congress                                                   Report
                                 SENATE
 1st Session                                                    106-173

======================================================================



 
             GRIFFITH PROJECT PREPAYMENT AND CONVEYANCE ACT

                                _______
                                

                October 6, 1999.--Ordered to be printed

                                _______


  Mr. Murkowski, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 986]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 986) to direct the Secretary of the 
Interior to convey the Griffith Project to the Southern Nevada 
Water Authority, having considered the same, reports favorably 
thereon with an amendment and recommends that the bill, as 
amended, do pass.
    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Griffith Project Prepayment and 
Conveyance Act''.

SEC. 2. DEFINITIONS.

    In this Act:
          (1) The term ``Authority'' means the Southern Nevada Water 
        Authority, organized under the laws of the State of Nevada.
          (2) The term ``Griffith Project'' means the Robert B. 
        Griffith Water Project, authorized by and constructed pursuant 
        to the Southern Nevada Water Project Act, Public Law 89-292, as 
        amended (commonly known as the ``Southern Nevada Water Project 
        Act'') (79 Stat. 1068), including pipelines, conduits, pumping 
        plants, intake facilities, aqueducts, laterals, water storage 
        and regulatory facilities, electric substations, and related 
        works and improvements listed pursuant to ``Robert B. Griffith 
        Water Project (Formerly Southern Nevada Water Project), Nevada: 
        Southern Clark County, Lower Colorado Region Bureau of 
        Reclamation,'' on file at the Bureau of Reclamation and all 
        interests in land acquired under Public Law 89-292, as amended.
          (3) The term ``Secretary'' means the Secretary of the 
        Interior.
          (4) The term ``Acquired Land(s)'' means all interests in 
        land, including fee title, right(s)-of-way, and easement(s), 
        acquired by the United States from non-Federal sources by 
        purchase, donation, exchange, or condemnation pursuant to 
        Public Law 89-292, as amended for the Griffith Project.
          (5) The term ``Public Land'' means lands which have never 
        left Federal ownership and are under the jurisdiction of the 
        Bureau of Land Management.
          (6) The term ``Withdrawn Land'' means Federal lands which are 
        withdrawn from settlement, sale, location of minerals, or entry 
        under some or all of the general land laws and are reserved for 
        a particular public purpose pursuant to Public Law 89-292, as 
        amended, under the jurisdiction of the Bureau of Reclamation, 
        or are reserved pursuant to Public Law 88-639 under the 
        jurisdiction of the National Park Service.

SEC. 3. CONVEYANCE OF GRIFFITH PROJECT.

    In General.--(a) In consideration of the Authority assuming from 
the United States all liability for administration, operation, 
maintenance, and replacement of the Griffith Project and subject to the 
prepayment by the Authority of the federal repayment amount of 
$121,204,348 (which amount shall be increased to reflect any accrued 
unpaid interest and shall be decreased by the amount of any additional 
principal payments made by the Authority after September 15, 1999 prior 
to the date on which prepayment occurs), the Secretary shall, pursuant 
to the provisions of this Act:
          (1) convey and assign to the Authority all of the right, 
        title, and interest of the United States in and to improvements 
        and facilities of the Griffith Project in existence as of the 
        date of this Act; and
          (2) convey and assign to the Authority all of the right, 
        title, and interest of the United States to Acquired Lands that 
        were acquired for the Griffith Project; and
          (3) convey and assign to the Authority all interests reserved 
        and developed as of the date of this Act for the Griffith 
        Project in lands patented by the United States.
    (b) Pursuant to the authority of this section, from the effective 
date of conveyance of the Griffith Project, the Authority shall have a 
right of way at no cost across all Public Land and Withdrawn Land,
          (1) on which the Griffith Project is situated; and
          (2) across any other federal lands as reasonably necessary 
        for the operation, maintenance, replacement, and repair of the 
        Griffith Project, including existing access routes.
Rights of way established by this section shall be valid for as long as 
they are needed for municipal water supply purposes and shall not 
require payment of rental or other fee.
    (c) Within twelve months after the effective date of this Act,
          (1) the Secretary and the Authority shall agree upon a 
        description of the land subject to the rights of way 
        established by subsection (b) of this section; and
          (2) the Secretary shall deliver to the Authority a document 
        memorializing such rights of way.
    (d) Report.--If the conveyance under subsection (a) has not 
occurred within twelve months after the effective date of this Act, the 
Secretary shall submit to Congress a report on the status of the 
conveyance.

SEC. 4. RELATIONSHIP TO EXISTING CONTRACTS.

    The Secretary and the Authority may modify Contract No. 7-07-30-
W0004 and other contracts and land permits as necessary to conform to 
the provisions of this Act.

SEC. 5. RELATIONSHIP TO OTHER LAWS AND FUTURE BENEFITS.

    (a) If the Authority changes the use or operation of the Griffith 
Project, the Authority shall comply with all applicable laws and 
regulations governing the changes at that time.
    (b) On conveyance of the Griffith Project under section 3 of this 
Act, the Act of June 17, 1902 (43 U.S.C. 391 et seq.), and all Acts 
amendatory thereof or supplemental thereto shall not apply to the 
Griffith Project. Effective upon transfer, the lands and facilities 
transferred pursuant to this Act shall not be entitled to receive any 
further Reclamation benefits pursuant to the Act of June 17, 1902, and 
all Acts amendatory thereof or supplemental thereto attributable to 
their status as a federal Reclamation Project, and the Griffith Project 
shall no longer be a federal Reclamation Project.
    (c) Nothing in this Act shall transfer or affect federal ownership, 
rights, or interests in Lake Mead National Recreation Area associated 
lands, nor affect the authorities of the National Park Service to 
manage Lake Mead National Recreation Area including lands on which the 
Griffith Project is located consistent with the Act of August 25, 1916 
(39 Stat. 535), Public Law 88-639, October 8, 1964 (78 Stat. 1039), or 
any other applicable legislation, regulation, or policy.
    (d) Nothing in this Act shall affect the application of Federal 
reclamation law to water delivered to the Authority pursuant to any 
contract with the Secretary under section 5 of the Boulder Canyon 
Project Act.
    (e) Effective upon conveyance of the Griffith Project and acquired 
interests in land under section 3 of this Act, the United States shall 
not be liable for damages of any kind arising out of any act, omission, 
or occurrence based on its prior ownership of the conveyed property.

                         purpose of the measure

    The purpose of S. 986 is to direct the Secretary of the 
Interior to convey title to the Griffith Project to the 
Southern Nevada Water Authority once certain conditions, 
including payment of the current repayment obligations, are 
met.

                          background and need

    The Robert B. Griffith Water Project is a single-purpose 
project, authorized in 1965 (Public Law 89-292 as amended by 
Public Law 89-510) and constructed by the Secretary of the 
Interior to deliver Colorado River water from Lake Mead for 
municipal and industrial use within Clark County, Nevada. In 
November 1971, the first-stage facilities were substantially 
complete and by the time the project was fully completed in 
February 1988, the project cost, including capitalized 
interest, totaled approximately $198.6 million. The project 
diverts up to 299,000 acre feet annually (AFA) of Nevada's 
consumptive use allocation of 300,000 AFA from the Colorado 
River.
    The Griffith project is an integral part of the Southern 
Nevada Water System (the System), which currently supplies over 
80 percent of the public water supply for the Las Vegas 
metropolitan area. The federally financed Griffith project is a 
very small part of the System that was designed, financed, and 
constructed by the Southern Nevada Water Authority (the 
Authority) and the Colorado River Commission of Nevada. Because 
certain reaches of pipelines and other facilities are in the 
name of the United States, project sponsors believe it is 
increasingly burdensome for the Authority to manage operations 
and maintenance of the System.
    Upon completion of certain conditions, including the 
payment of the remaining repayment obligation (currently 
estimated at approximately $121.2 million), the Secretary of 
the Interior is directed to convey title to the Griffith 
Project to the Authority. Created in 1991 by a cooperative 
agreement among seven public agencies, including the five water 
purveyors that serve all of southern Nevada, the Authority is a 
political subdivision of the State of Nevada. The Authority is 
responsible for acquiring additional water supplies for the 
region and operating, maintaining, expanding, and ultimately 
acquiring the Southern Nevada Water System.
    In June of 1999, the Authority and the Bureau of 
Reclamation entered into a Memorandum of Agreement relating to 
the proposed title transfer and negotiations continue between 
the Bureau and the Authority regarding details of the transfer.

                          legislative history

    S. 986 was introduced by Senators Reid and Bryan on May 6, 
1999 and a subcommittee hearing was held on July 28, 1999. At 
the business meeting on September 22, 1999, the Committee on 
Energy and Natural Resources ordered S. 986, as amended, 
favorably reported.

           committee recommendations and tabulation of votes

    The Committee on Energy and Natural Resources, in open 
business session on September 22, 1999, by unanimous vote of a 
quorum present, recommends that the Senate pass S. 986, if 
amended as described herein.

                          committee amendments

    During the consideration of S. 986, the Committee adopted a 
substitute amendment that reflects both technical and 
substantive changes to resolve the concerns of the National 
Park Service, the Bureau of Land Management and the Bureau of 
Reclamation. Additional amendments have been made at the 
request of the Southern Nevada Water Authority. Specifically, 
technical changes were made to several definitions relating to 
interests being conveyed and at the request of the Authority, 
the specific prepayment amount has been added which will be 
adjusted to reflect unpaid accrued interest and prospective 
principal payments to be made by the Authority. Section 3 has 
been revised to establish, effective upon prepayment and 
conveyance, rights of way for the Authority on federal land 
where the Griffith project is located. Specific deadlines 
imposed upon the Secretary for a report to Congress if the 
project has not been conveyed and completion of the document 
which memorializes the location of the rights of way have been 
extended to occur within twelve months after enactment.
    The requirement for repayment of net present value of 
repayment obligation has been replaced with a specific dollar 
amount.
    In addition, a section has been added which clarifies that 
once the project is transferred, it will cease to be a 
reclamation project eligible to receive benefits under the 
reclamation law and the United States is released from all 
future liability with respect to the operation and maintenance 
of the project. Lastly, a provision has been added to clarify 
the relationship of the project to the Lake Mead National 
Recreation Area and to clarify that reclamation law will 
continue to apply only as it relates to the Colorado River 
water being delivered through the project under section 5 of 
the Boulder Canyon Project Act.

                           section-by-section

    Section 1 is a short title.
    Section 2 is a definitions section.
    Section 3 describes the conditions that must be met prior 
to conveyance and what interests shall be transferred to the 
Authority upon conveyance. A specific dollar amount is 
designated as the repayment amount. Upon conveyance of the 
Griffith Project and the acquired interests in land under the 
United States shall no longer be liable for damages of any kind 
arising out of any act, omission, or occurrence based on is 
prior ownership of the conveyed property.
    Section 4 provides authority to modify existing contracts 
as necessary.
    Section 5 provides that once the Griffith Project is 
conveyed to the Southern Nevada Water Authority, the Project 
will no longer be considered to be a federal reclamation 
project subject to the benefits or obligations pursuant to 
reclamation law. This section also clarifies that nothing in S. 
986 shall affect the application of Federal reclamation law to 
water delivered to the Authority pursuant to any contract with 
the Secretary under section 5 of the Boulder Canyon Project Act 
and the Southern Nevada Water Authority remains obligated to 
the terms and provisions of its section 5 water contracts with 
the Secretary for Colorado River water.
    Section 5 also provides that if the Authority changes the 
use or operation of the Griffith Project, the Authority shall 
comply with all applicable laws and regulations governing the 
changes at that time. Section 5 clarifies that the project's 
transfer shall not affect federal ownership, rights, or 
interests in Lake Mead National Recreation Area or the lands 
associated with the Recreation Area. In addition, S. 986 does 
not affect the authorities of the National Park Service to 
manage Lake Mead National Recreation Area including lands on 
which the Griffith Project is located consistent with the Act 
of August 25, 1916 (39 Stat. 535), Public Law 88-639, October 
8, 1964 (78 Stat. 1039), or any other applicable legislation, 
regulation, or policy.

                   cost and budgetary considerations

    The Congressional Budget Office cost estimate report had 
not been received at the time the report was filed. When the 
report becomes available, the Chairman will request that it be 
printed in the Congressional Record for the advice of the 
Senate.

                      regulatory impact evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 986. The bill is not a regulatory measure in 
the sense of imposing Government-established standards or 
significant economic responsibilities on private individuals 
and businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of S. 986, as ordered reported.

                        executive communications

    On July 19, 1999, the Committee on Energy and Natural 
Resources requested legislative reports from the Department of 
the Interior and the Office of Management and Budget setting 
forth Executive agency recommendations on S. 986. These reports 
had not been received at the time the report on S. 986 was 
filed. When the reports become available, the Chairman will 
request that they be printed in the Congressional Record for 
the advice of the Senate. The testimony provided by the 
Department of the Interior at the Subcommittee hearing follows:

    Statement of Steven Richardson, Chief of Staff, U.S. Bureau of 
                Reclamation, Department of the Interior

    My name is Steve Richardson. I am Chief of Staff for the 
U.S. Bureau of Reclamation. I am pleased to provide the 
Administration's views on S. 986, to direct the Secretary of 
the Interior to convey the Griffith Project to the Southern 
Nevada Water Authority (SNWA).
    Mr. Chairman, the Robert B. Griffith Project (authorized by 
P.L. 89-292) is a single purpose municipal and industrial 
project originally capable of supplying 299,000 acre feet of 
supplemental water annually from Lake Mead to Henderson, Las 
Vegas, North Las Vegas, Boulder City and Nellis Air Force Base 
in southeastern Nevada. In addition to the Federal facilities, 
SNWA has significantly expanded the project, at its own 
expense, in order to meet the growing need for water in the 
region.
    For several months, the Bureau of Reclamation 
(Reclamation), the Bureau of Land Management (BLM), the 
National Park Service (NPS), and SNWA have been working to 
identify the issues of concern as well as to initiate the 
process required under the National Environmental Policy Act 
(NEPA). I am pleased to report that on June 21, 1999, 
Reclamation and SNWA entered into an agreement, which I have 
attached for the record, to set forth a process to accomplish 
the transfer of title to the facilities and acquired lands to 
SNWA and to grant or assign perpetual rights-of-way over 
applicable federal public and withdrawn lands and to facilitate 
SNWA's future operation, maintenance and replacement of the 
Griffith Project. In addition, we have a funding agreement 
which SNWA's Board of Directors has endorsed and they are up-
front funding the activities under the agreement.
    Furthermore, we have begun the NEPA process and hope to 
have public scoping meetings in mid August.
    Unfortunately, S. 986 does not reflect all of the good work 
and progress that has been made and is underway. As such, the 
Administration opposes S. 986 as introduced. We are, however, 
working closely with Senator Reid, SNWA, and Representative 
Gibbons, who introduced a similar bill in the House of 
Representatives, to develop a substitute to S. 986 which we 
hope will address the Department's concerns.
Background
    Before I address the Department's concerns on S. 986 as 
introduced, I would like to give the Committee a short update 
on Reclamation's title transfer efforts across the Western 
United States.
    In August, 1995, the Bureau of Reclamation's title transfer 
efforts began as part of Phase II of the Vice President's 
National Performance Review (REGO II). It was and is still 
viewed as an opportunity to create a government that works 
better and costs less. The purpose of this initiative is to 
facilitate the transfer of facilities, that could be more 
efficiently and appropriately managed by others.
    At that time, Reclamation released its Framework for 
Transfer of Title of Bureau of Reclamation Projects. This 
framework sets out a consistent, fair and open process for 
negotiating the transfer of title of appropriate facilities on 
a voluntary case-by-case basis with the involvement of all 
interested stakeholders to reach an agreement. Once completed, 
this agreement would be brought to Congress to be approved and 
would be supported by all the parties involved.
    Soon after the Administration announced its initiative, 
more than sixty-five entities contacted Reclamation and 
Expressed their interest in title transfer. Since that time, 
many others have come forward. Many agreed to pursue the 
Framework process and we have had some success. This process 
can lead to an agreement that could be brought to Congress for 
authorization with Administration support. Others decided not 
to pursue title transfer at that time, while others opted not 
to pursue Reclamation's Framework process, opting instead to 
directly pursue a legislative route. In some cases, attempting 
to legislate a solution without local participation or 
negotiation has resulted in delays and raised a number of 
problems that have limited our progress.

                           Recent Activities

    During the 105th Congress, we came close to getting 
legislation enacted on several transfer proposals. What is 
significant about this is that in some cases we were far from 
an agreement just a few months earlier. However, two pieces of 
legislation did become law.
    First, legislation was adopted to authorize the Canadian 
River Authority (Authority) in Texas, to prepay its financial 
obligation to the United States which would result in the 
conveyance of the Canadian River pipeline and other features of 
this project to the Authority. We are pleased to report that 
this prepayment was made on May 25, 1999 and title to these 
facilities has been transferred.
    Second, legislation was adopted to convey the South Side 
Pumping Division of the Minidoka Project, located in Burley, 
Idaho to the Burley Irrigation District (BID). Because the 
legislation envisioned completion of the NEPA process, an 
environmental assessment is in the process of being prepared 
and we hope to have a draft completed by September 30, 1999. 
The legislation also required the completion of an agreement on 
the terms and conditions for the conveyance of the natural flow 
water rights that are associated with the project. Under the 
legislation, completion of this agreement must include BID, the 
Minidoka Irrigation District, and the Secretary in accordance 
with Idaho state law.
    In addition to these, we continue to work with many 
districts and other interested stakeholders on title transfer 
for water projects and facilities throughout the western United 
States.

                  Concerns About S. 986, as Introduced

    As I stated earlier, we have been working with SNWA and 
others to resolve many issues that need to be addressed. As I 
also stated, much progress has been made and the NEPA process 
is well underway. However, that progress is not reflected in S. 
986. Our concerns on S. 986 as introduced are as follows:
    (1) Compliance with NEPA and Other Laws and Treaties: S. 
986 as introduced directs rather than authorizes the Secretary 
to convey the facilities of the Project. This mandate directing 
the Secretary could severely diminish the value of the NEPA 
process, as the Secretary's ultimate decision regarding the 
transfer would be predetermined. The Administration firmly 
believes that a meaningful NEPA analysis must occur prior to 
title transfer to allow the Department, the Congress, and the 
public to fully understand the impacts of the proposed 
transfer, its alternatives, and potential mitigation measures. 
While we do not anticipate encountering significant 
environmental issues in this transfer, the Secretary's 
authority to condition the transfer in ways that resolve any 
issues identified during the NEPA process prior to title 
transfer must also be clear.
    (2) Lands and Rights-of-Way: While the Administration 
appreciates the bill's intent to base the Griffith Project 
title transfer on the general terms of asset transfers set out 
in the Office of Management and Budget Circular A-129, specific 
legislative reference may not be appropriate. For instance, the 
BLM and the National Park Service have brought some very 
serious concerns with respect to lands and rights-of-way to our 
attention. Both these agencies have significant interest in the 
lands associated with the Griffith Project--since the intake 
structures, a treatment plant, and pipeline are located within 
the Lake Mead National Recreation Area (LMNRA) and much of the 
lands associated with the Griffith Project are withdrawn for 
project purposes from BLM. As presently drafted, S. 986 
proposes to transfer all the lands used for the Griffith 
Project in fee simple title (specifically see section 3(a) 
regarding conveyance of ``all rights, title, and interest''). 
The Department strongly opposes this provision. Transferring 
the lands in fee simple, as proposed, raises a number of 
serious concerns not the least of which are impact on the 
National Park Service's ability to fulfill the purposes for 
which the LMNRA was established, the current valid existing 
rights underlying the rights-of-way, and the potential for 
ownership conflicts on private property. However, if the bill 
would change the language to transfer or assign the existing 
right-of-way, our major concern on this matter would be 
addressed and the intent of rights of use by SNWA would be 
protected.
    Furthermore NPS is concerned that the terms for transfer of 
facilities for their future operations, management and 
replacement, especially for use and occupancy of public lands 
(Section 3(b)) needs to be clarified. The Department wants to 
ensure that the terms are consistent with the purposes for 
which Lake Mead National Recreation Area was established.
    Additionally, the BLM and the Park Service would like the 
opportunity to discuss additional technical provisions with the 
Committee. This would include, among other things, the ability 
to recover costs associated with maintaining and administering 
rights-of-way permits.
    (3) Deadline: Section 3(d) of S. 986, as drafted, proposes 
a deadline which we strongly oppose. It states that if the 
Secretary completes the conveyance by July 1, 2000, the cost of 
administrative actions and environmental compliance would be 
equally split between the Secretary and SNWA. It further 
states, however, that if the facilities are not transferred in 
this very short time period, regardless of who is responsible 
for the delay, that all of these costs would be borne by the 
Secretary. This provision is problematic and diminishes the 
NEPA process. Also, it may provide an incentive to delay the 
completion of the environmental and public reviews, since the 
United States would be required to pay for all the 
administrative and environmental costs if there are delays for 
more than the extremely short time period allowed in the bill.
    (4) Relationship to Existing Operations: The provisions of 
Section 4 of S. 986 as introduced have caused considerable 
concerns and confusion about its intent. Subsection 4(a) states 
that this Act does not propose to ``expand or change the use of 
the Project,'' while subsection 4(b) states that if the 
Authority does change the Project's use in the future, it must 
comply with applicable laws at the time. Concerns have been 
raised that these provisions are intended to statutorily exempt 
this transfer from the provisions of NEPA, but the provisions 
of 4(b) allow for changes in the use and management of the 
Project. If this is the intent, the Administration strongly 
opposes this provision. We suggest that they either be 
clarified or simply deleted.
    (5) Future Benefits: Section 6 of S. 986 should be expanded 
to make clear that once transferred, the lands and facilities 
should no longer be eligible for further Reclamation benefits 
pursuant to the Reclamation Act of 1902, and acts supplementary 
thereof or amendatory thereto. In short, it should be stated 
that upon transfer, the Griffith Project would no longer be 
considered a Federal Reclamation Project.
    (6) Secretary as Water Master: S. 986 needs to be clarified 
to ensure that after transfer, SNWA will continue to operate 
within the Secretary's authority as water master of the 
Colorado River which was delegated to him by Congress in the 
Boulder Canyon Act of 1928 (45 Stat. 1057) and strengthened in 
the March 9, 1964 Supreme Court Decree in Arizona v. California 
(376 U.S. 340).
    (7) 300-Foot Reservation Around Lake Mead: S. 986 needs to 
be clarified to maintain an existing Reservation of the 300-
foot zone (all lands within 300 feet landward from the high 
water mark--1,229 foot elevation of Lake Mead and 655 foot 
elevation of Lake Mohave) as a Reclamation project area to 
allow for proper management security, maintenance, and use of 
Reclamation facilities authorized by law. These uses include 
necessary flooding, inundation, bank modification, staging, 
facilities maintenance, and proper management and adjustment of 
the levels of those bodies of water within the Lake Mead 
National Recreation Area pursuant to Reclamation's statutory 
and contractual responsibilities and management of water in the 
overall public interest.
    (8) Nellis Air Force Base Water Supply: Under current law 
and contract, Nellis Air Force Base, located in southern 
Nevada, receives 4,000 acre-feet of treated Colorado River 
water through the Griffith system contingent upon their payment 
of a reasonable amount for operations, maintenance and 
replacement of the facilities. S. 986 should clarify that this 
arrangement is guaranteed after title is transferred.
    Mr. Chairman, there are a number of other technical issues 
that the Department has with this proposal which Reclamation, 
BLM and the Park Service would like to work on with this 
Committee.
    In summary, the Griffith Project is a good candidate for 
title transfer. We have made a significant amount of progress 
and continue to work well with SNWA and others to work through 
other issues that have been identified and on the NEPA process. 
Furthermore, we are interested in continuing to work with the 
Committee to develop a substitute to S. 986 which we hope will 
address the Department's concerns.
    That concludes my testimony. I would be pleased to answer 
any questions.

                        changes in existing law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by the bill S. 986, as ordered 
reported.

                                  
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