[Federal Register Volume 66, Number 183 (Thursday, September 20, 2001)]
[Proposed Rules]
[Pages 48402-48406]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-23483]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[AZ040-OPP; FRL-7058-7]


Clean Air Act Proposed Approval of Operating Permit Programs; 
Pinal County Air Quality Control District, AZ

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve revisions to the Pinal County Air 
Quality Control District (Pinal or District) operating permit program. 
The Pinal operating permit program was submitted in response to the 
directive in the 1990 Clean Air Act (CAA) Amendments that permitting 
authorities develop, and submit to EPA, programs for issuing operating 
permits to all major stationary sources and to certain other sources 
within the permitting authorities' jurisdiction. EPA granted interim 
approval to the Pinal operating permit program on October 30, 1996. See 
61 FR 55910. The District consequently revised its program to satisfy 
the conditions of the interim approval; however, the effective date of 
the revisions was made contingent upon EPA approving the changes under 
both 40 CFR part 70 and 40 CFR part 52. On September 5, 2001, the 
District revised the rules again in order to make the effective date of 
the rule changes contingent solely upon EPA approval under part 70. EPA 
is proposing to approve the operating permit program contingent upon 
Pinal submitting the rules that were adopted on September 5, 2001 as a 
revision to its part 70 program.

DATES: Comments on the program revisions discussed in this proposed 
action must be received in writing by October 22, 2001.

ADDRESSES: Written comments on this action should be addressed to 
Gerardo Rios, Acting Chief, Permits Office, Air Division (AIR-3), EPA 
Region IX, 75 Hawthorne Street, San Francisco, California, 94105. You 
can inspect copies of Pinal's submittal and other supporting 
documentation relevant to this action during normal business hours at 
the Air Division of EPA Region 9, 75 Hawthorne Street, San Francisco, 
California, 94105. You may also see copies of the submitted title V 
program at the following location: Pinal County Air Quality Control 
District, Building F, 31 North Pinal Street, Florence, Arizona 85232.

FOR FURTHER INFORMATION CONTACT: Ginger Vagenas, EPA Region IX, Permits 
Office (AIR-3), U.S. Environmental Protection Agency, Region IX, (415) 
744-1252 or [email protected].

SUPPLEMENTARY INFORMATION: This section provides additional information 
by addressing the following questions:
    What is the operating permit program?
    What is EPA's proposed action?
    What are the program changes that EPA is approving?
    What is the effect of this proposed action?

I. What Is the Operating Permit Program?

    The CAA Amendments of 1990 required all state and local permitting 
authorities to develop operating permit programs that met certain 
federal criteria. In implementing the operating permit programs, the 
permitting authorities require certain sources of air pollution to 
obtain permits that contain all applicable requirements under the CAA. 
The focus of the operating permit program is to improve compliance by 
issuing each source a permit that consolidates all of the applicable 
CAA requirements into a federally enforceable document. By 
consolidating all of the applicable requirements for a facility, the 
source, the public, and the permitting authorities can more easily 
determine what CAA requirements apply and how compliance with those 
requirements is determined.
    Sources required to obtain an operating permit under this program 
include ``major'' sources of air pollution and certain other sources 
specified in the CAA or in EPA's implementing regulations. For example, 
all sources regulated under the acid rain program, regardless of size, 
must obtain permits. Examples of major sources include those that have 
the potential to emit 100 tons per year or more of volatile organic 
compounds, carbon monoxide, lead, sulfur dioxide, nitrogen oxides 
(NOX), or particulate matter (PM10); those that 
emit 10 tons per year of any single hazardous air pollutant 
(specifically listed under the CAA); or those that emit 25 tons per 
year or more of a combination of hazardous air pollutants (HAPs). In 
areas that are not meeting the national ambient air quality standards 
for ozone, carbon monoxide, or particulate matter, major sources are 
defined by the gravity of the nonattainment classification. For 
example, in ozone nonattainment areas classified as ``serious,'' major 
sources include those with the potential of emitting 50 tons per year 
or more of volatile organic compounds or nitrogen oxides.

II. What Is EPA's Proposed Action?

    Because the Pinal operating permit program substantially, but not 
fully, met the criteria outlined in the implementing regulations 
codified at 40 Code of Federal Regulations (CFR) part 70, EPA granted 
interim approval to the program in a rulemaking published on October 
30, 1996 (61 FR 55910). The interim approval notice described the 
conditions that had to be met in order for the Pinal program to receive 
full approval. This Federal Register notice describes the changes that 
have been made to the Pinal operating permit program to correct 
conditions for full approval.
    EPA is proposing full approval of the operating permits program 
submitted by Pinal based on the revisions adopted as of September 5, 
2001. These revisions satisfactorily address the program deficiencies 
identified in EPA's October 30, 1996 rulemaking. See 61 FR 55910. In 
addition, EPA is proposing to approve, as a title V operating permit 
program revision, additional changes to the rules. The interim approval 
issues, Pinal's corrections, and the additional changes are described 
below under the section entitled ``What are the program changes that 
EPA is approving?''

[[Page 48403]]

III. What Are the Program Changes That EPA Is Approving?

A. Corrections to Interim Approval Issues

    In its October 30, 1996 rulemaking, EPA made full approval of 
Pinal's operating permit program contingent upon the correction a 
number of interim approval issues. Each issue, along with Pinal's 
correction, is described below.
    1. Rule deficiency: Because the phrase ``including any fugitive 
emissions of any such pollutants'' in the version of the rule in 
Pinal's approved part 70 program could be read to modify only the 25 
ton per year threshold, PCR Sec. 1-3-140(79)(b)(i) (the definition of 
``major source'') did not clearly require that fugitive emissions of 
HAPs be included when determining a source's potential to emit. In 
order to correct the deficiency, the definition needed to be revised so 
that it would be clear that fugitive emissions of hazardous air 
pollutants must be considered in determining whether the source is 
major for purposes of both the 10 ton per year and 25 ton per year HAP 
major source thresholds. See 40 CFR section 70.2.
    Rule change: The rule has been revised to correct the deficiency. 
It now defines a major source under section 112 of the CAA to include, 
``* * * for pollutants other than radionuclides, any stationary source 
that emits, or has the potential to emit, in the aggregate and 
including fugitive emissions, 10 tons per year or more of any hazardous 
air pollutant which has been listed pursuant to section 112(b) of the 
CAA, 25 tons per year of any combination of such hazardous air 
pollutants, or such lesser quantity as described in Chapter 7 of this 
Code.'' (Emphasis added.)
    2. Rule deficiency: The major source definition in Pinal's original 
submittal was less inclusive than the definition in part 70 in that it 
did not require that certain sources count fugitive emissions towards 
major source thresholds. In order to correct this deficiency, EPA 
required that Pinal revise PCR Sec. 1-3-140(79)(c) to delete sections 
79(c)(ii), (iii), and (iv) and to add sources that belong to a category 
regulated by a standard promulgated under section 111 or 112 of the 
Act, but only with respect to those air pollutants that have been 
regulated for that category, to the list of sources that must include 
fugitive emissions when determining major source status as defined in 
section 302(j) of the Act. See 40 CFR section 70.2.
    Rule change: The rule has been revised as required by EPA.
    3. Rule deficiency: Pinal's title V program provided certain 
exemptions that are not allowed under part 70. In order to correct the 
problem, EPA required that Pinal revise PCR Sec. 3-1-040(C)(1) to 
require that the motor vehicles, agricultural vehicles, and fuel 
burning equipment that are exempt from permitting shall not be exempt 
if they are subject to any applicable requirements. See 40 CFR section 
70.5(c).
    Rule change: PCR 3-1-040(C) contains exemptions from the permitting 
requirements. It has been modified so that, while a general exemption 
for agricultural equipment used in normal farm operations exists, the 
exemption does not apply to ``equipment that would be classified as a 
source that would require a permit under title V of the Clean Air Act 
(1990), or would be subject to a standard under 40 CFR Parts 60 or 61, 
or any other applicable requirement.'' This language is consistent with 
what other Arizona agencies did in their original submittals and we 
found to be fully approvable. The rule no longer provides an exemption 
for motor vehicles or fuel burning equipment.
    4. Rule deficiency: Pinal's originally submitted program contained 
flaws in its provisions regarding the timing of the submission of 
permit applications. In order to correct the deficiencies, EPA required 
that PCR Sec. 3-1-045(F)(1) be revised to require sources requiring 
Class A (title V) permits to submit a permit application no later than 
12 months after the date the Administrator approves the District 
program. In addition, Pinal was required to revise PCR Sec. 3-1-050(C) 
to include an application deadline for existing sources that become 
subject to the requirement to obtain a Class A permit after the initial 
phase-in of the program. This application deadline must be 12 months 
from when the source becomes subject to the program (meets Class A 
permit applicability criteria). See 40 CFR section 70.5(a)(1)(i).
    Rule change: The district has corrected these deficiencies in the 
following manner. PCR 3-1-045(F)(1) now requires that sources in 
existence on November 3, 1993 not holding valid permits to operate or 
installation permits must submit an application within 180 days of 
receipt of notice from the Control Officer that a permit is required or 
within 12 months of becoming subject to the Class A permitting 
requirements, whichever is earlier. PCR3-1-050(C)(2) now specifies that 
a timely application for an existing source that is not initially 
required to obtain a title V permit but becomes subject at some later 
time to be one that is submitted within 12 months after the source 
becomes subject to title V.
    5. Rule deficiency: Section 70.6(a)(8) requires that title V 
permits contain a provision that ``no permit revision shall be required 
under any approved economic incentives, marketable permits, emissions 
trading and other similar programs or processes for changes that are 
provided for in the permit.'' PCR Sec. 3-1-081(A)(10) included this 
exact provision but also included a sentence that negated this 
provision. EPA required that Pinal either delete or revise the negating 
sentence to make the rule consistent with part 70. See 40 CFR section 
70.6(a)(8).
    Rule change: The negating sentence has been deleted from Pinal's 
rule.
    6. Rule deficiency: Section 70.4(b)(12) provides that sources are 
allowed to make changes within a permitted facility without requiring a 
permit revision, if the changes are not modifications under any 
provision of title I of the Act and the changes do not exceed the 
emissions allowable under the permit. Specifically, section 
70.4(b)(12)(iii) provides that if a permit applicant requests it, the 
permitting authority shall issue a permit allowing for the trading of 
emissions increases and decreases in the permitted facility solely for 
the purpose of complying with a federally enforceable emissions cap, 
established in the permit independent of otherwise applicable 
requirements. PCR Sec 3-1-081(A)(14) provided for such permit 
conditions without excluding modifications under title I of the Act and 
changes that do not exceed the emissions allowable under the permit. 
Pinal was required to revise PCR Sec. 3-1-081(A)(14) to clarify that 
changes made under this provision may not be modifications under any 
provision of title I of the Act and may not exceed emissions allowable 
under the permit. In addition, this provision needed to be revised to 
require that the permit terms and conditions provide for notice that 
conforms to section 3-2-180(D) and (E) and that describes how the 
increases and decreases in emissions will comply with the terms and 
conditions of the permit. See 40 CFR section 70.4(b)(12).
    Rule changes: PCR 3-1-081(A)(14)(d) now specifies that permits that 
contain terms and conditions allowing for the trading of emissions for 
the purpose of complying with a federally enforceable emission cap 
established independent of otherwise applicable requirements ``shall 
provide for notice that conforms with section 3-2-180(D) and (E) and 
describes how the increases and decreases in emissions will comply with 
the terms and conditions of the permit, as per 40 CFR Chapter 1, Part 
70, section

[[Page 48404]]

70.4(b)(12).'' PCR 3-1-081(A)(14)(e) requires that ``changes made under 
this subparagraph shall not include modifications under any provision 
of title I of the Act and may not exceed emissions allowable under the 
permit.''
    7. Rule deficiency: In order to ensure that the requirement to 
obtain a title V permit is enforceable, Pinal was required to revise 
PCR Sec. 3-4-420 to provide that a conditional order that allows a 
source to vary from the requirement to obtain a Class A permit may not 
be granted to any source that meets the Class A permit applicability 
criteria pursuant to PCR Sec. 3-1-040.
    Rule change: 3-4-420(A) disqualifies a Class A permit holder from 
eligibility for a conditional order and provides that a conditional 
order cannot shield a Class B (non-title V) permit holder from an 
obligation to apply for a title V permit. Section 3-4-420(B) only 
allows conditional orders to be issued to Class B permit holders. 
Therefore, unpermitted sources, Class A sources, and anyone holding a 
Class B permit that is required to obtain a Class A permit cannot be 
covered by a conditional order.
    8. Rule deficiency: Pinal's original title V program submittal 
allowed a source to operate within the limitations set forth in its 
general permit application until the District took action on the 
application. This is inconsistent with part 70. In order to correct 
this deficiency, Pinal was required to revise PCR Sec. 3-5-490(C) to 
provide that when an existing source that files a timely and complete 
application seeking coverage under a general permit either as a renewal 
of authorization under the general permit or as an alternative to 
renewing an individual part 70 permit, the source must continue to 
comply with the terms and conditions of the permit under which it is 
operating, even if that permit expires, until the District issues or 
denies the authorization to operate under the general permit. See 40 
CFR section 70.4.(b)(10).
    Rule change: PCR Sec. 3-5-490(C)(1) now requires that ``an existing 
source that has filed a timely and complete application seeking 
coverage under a general permit, either as a renewal of authorization 
under the general permit or as an alternative to renewing an individual 
permit shall continue to comply with the terms and conditions of the 
permit under which it is operating, even if that permit expires, until 
the Control Officer issues or denies the authorization to operate under 
the general permit.''
    9. Rule deficiency: Pinal's title V program allowed a source 
seeking coverage under a general permit as an alternative to renewing 
its existing permit to operate under the terms of the general permit 
even when coverage had been denied. To correct this problem, EPA 
required that Pinal revise PCR Sec. 3-5-490(C) to require that if an 
existing source seeking coverage under a general permit as an 
alternative to renewing an individual permit is denied coverage, the 
source must continue to comply with the terms and conditions of its 
individual source permit. In addition, Pinal was required to revise 
Sec. 3-5-490(C) to clarify that, notwithstanding the 180-day permit 
application deadline set by the District in its notification to the 
source, a source that was denied coverage under the general permit may 
not operate after the date that its individual permit expires unless it 
has submitted a timely and complete application to renew that 
individual permit in accordance with PCR Sec. 3-1-050(C)(2). See 40 CFR 
sections 70.7(d) and 70.4(b)(10).
    Rule changes: PCR Sec. 3-5-490(C)(2) now requires that ``[i]f the 
application from an existing source seeking coverage as an alternative 
to renewing an individual permit is denied, the source shall continue 
to comply with the terms and conditions of its individual source 
permit.'' PCR Sec. 3-5-490(C)(2) specifies that a source that was 
denied coverage under a general permit may continue to operate under 
its individual permit provided it has filed a timely and complete 
application prior to the expiration of the source's individual permit.
    10. Rule deficiency: In order to resolve some internal 
inconsistencies in Pinal's regulations PCR Sec. 3-5-550(C) needed to be 
revised to clarify that if the Control Officer revokes a source's 
authorization to operate under a general permit and the source submits 
a timely and complete application for an individual source permit as 
required by the Control Officer, it may continue to operate under the 
terms of the general permit until the District issues or denies the 
individual source permit.
    Rule change: PCR Sec. 3-5-550(C) has been revised to correct the 
deficiency as follows: ``A source authorized to operate under a general 
permit may operate under the terms of the general permit until the 
earlier date of expiration of the general permit or 180 days after 
receipt of the notice of termination of any general permit. If the 
operator submits a timely and complete application for an individual 
permit in accordance with sections 3-1-050, 3-1-055, and 3-5-490, while 
still authorized to operate under the terms of its general permit, the 
applicant may continue to operate under authority of the underlying 
general permit until the Control Officer issues or denies the 
individual permit.''

B. Other Changes

    EPA is also taking action to approve, as a title V operating permit 
program revision, additional program changes made by Pinal since the 
interim approval was granted. Some of the rules Pinal has submitted for 
EPA approval incorporate changes other than those described above. We 
have evaluated the additional changes and find that they are consistent 
with part 70 and are therefore including those changes in our proposed 
approval. These changes are described below:
    1. PCR 3-1-040. Paragraph B.2., which spells out applicability 
criteria for non-title V permits, has been modified. Part 70 does not 
address permit requirements for non-title V sources, and so this change 
is not relevant to the approval of this rule pursuant to part 70. A new 
paragraph D. was also added to the rule. This new provision specifies 
that construction or reconstruction of a major source of HAP renders 
the source subject to MACT standards promulgated by EPA, or, where no 
standard has been promulgated, to a case-by-case MACT determination 
pursuant to 40 CFR sections 63.40 through 63.44. This change is 
consistent with part 70 and is therefore approvable.
    2. PCR 3-1-045. Paragraph E. of the version of the rule originally 
approved by EPA has been deleted. This paragraph specified the fee 
schedule that sources would be subject to prior to EPA's approval of 
the District's title V program and is no longer necessary.
    3. PCR 3-1-050. Paragraph C of this rule, which specifies the 
criteria an application must meet in order to be considered timely, has 
been changed to eliminate a reference to a Rule 3-1-047. Whereas the 
originally approved version of the rule provided that, ``[u]nless 
otherwise required by 3-1-045 or 3-1-047, a timely application is * * 
*'' the modified provision references only 3-1-045. Because 3-1-047 was 
never an approved element of the part 70 program and was not relied 
upon to meet part 70 requirements, the elimination of this reference 
has no effect on the approvability of this rule pursuant to part 70.
    4. PCR 3-1-081. Consistent with part 70, paragraph B of this rule 
provides that all conditions of a permit, except those that are 
specifically designated as not federally enforceable, are enforceable 
by the Administrator and citizens under the Clean Air Act. Paragraph 
B.2. has been modified to specify that any provision that a source

[[Page 48405]]

elects to make federally enforceable pursuant to the District's 
synthetic minor permitting rule may not be designated as non-federally 
enforceable. This change is consistent with part 70 and is therefore 
approvable.

IV. What Is the Effect of This Proposed Action?

    Pinal previously adopted rule revisions that addressed the issues 
identified in EPA's interim approval and described above. On September 
5, 2001, the District adopted a revision to the effective date of those 
rules. EPA action granting full approval to Pinal's title V program 
must be completed by December 1, 2001 to avoid the imposition of the 
federal operating permit program, part 71. In order to provide EPA 
adequate time to undertake notice and comment rulemaking on the 
District's title V program, Pinal submitted a copy of its revised rules 
to EPA on August 6, 2001. The District requested that we propose action 
on those rules prior to the formal submittal of the District's changes 
regarding the effective date of the rules. The rules we are proposing 
for approval today are those the District adopted on September 5, 2001. 
Table 1 lists the rules addressed by this proposal with the dates that 
they were adopted and when we anticipate they will be submitted by 
Pinal.

                                                     Table 1
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                                                                                                    Anticipated
                   Rule#                                  Rule title               Adoption date  submittal date
----------------------------------------------------------------------------------------------------------------
PCR 1-3-140 (79)...........................  Definitions (definition of                   9/5/01         9/30/01
                                              stationary source only).
PCR 3-1-040................................  Applicability and Classes of                 9/5/01         9/30/01
                                              Permits.
PCR 3-1-045................................  Transition from Installation and             9/5/01         9/30/01
                                              Operating Permit Program.
PCR 3-1-050................................  Permit Application Requirements....          9/5/01         9/30/01
PCR 3-1-081................................  Permit Conditions..................          9/5/01         9/30/01
PCR 3-4-420................................  Standards of Conditional Orders....          9/5/01         9/30/01
PCR 3-5-490................................  Application for Coverage under a             9/5/01         9/30/01
                                              General Permit.
PCR 3-5-550................................  Revocations of Authority to Operate          9/5/01         9/30/01
                                              under a General Permit.
----------------------------------------------------------------------------------------------------------------

    Should Pinal submit these rules to EPA as a title V program 
revision in the form in which they were adopted on September 5, 2001, 
Pinal will have fulfilled the conditions of the interim approval 
granted on October 30, 1996 [61 FR 55910]. EPA is therefore proposing 
full approval of the Pinal operating permit program contingent on the 
submittal of the rules listed above.

Request for Public Comment

    EPA requests comments on the program revisions discussed in this 
proposed action. Copies of the Pinal submittal and other supporting 
documentation used in developing the proposed full approval are 
contained in docket files maintained at the EPA Region 9 office. The 
docket is an organized and complete file of all the information 
submitted to, or otherwise considered by, EPA in the development of 
this proposed full approval. The primary purposes of the docket are: 
(1) To allow interested parties a means to identify and locate 
documents so that they can effectively participate in the approval 
process, and (2) to serve as the record in case of judicial review. EPA 
will consider any comments received in writing by October 22, 2001.

Administrative Requirements

    Under Executive Order 12866, ``Regulatory Planning and Review'' (58 
FR 51735, October 4, 1993), this proposed action is not a ``significant 
regulatory action'' and therefore is not subject to review by the 
Office of Management and Budget. Under the Regulatory Flexibility Act 
(5 U.S.C. 601 et seq.) the Administrator certifies that this proposed 
rule will not have a significant economic impact on a substantial 
number of small entities because it merely approves state law as 
meeting federal requirements and imposes no additional requirements 
beyond those imposed by state law. This rule does not contain any 
unfunded mandates and does not significantly or uniquely affect small 
governments, as described in the Unfunded Mandates Reform Act of 1995 
(Public Law 104-4) because it proposes to approve pre-existing 
requirements under state law and does not impose any additional 
enforceable duties beyond that required by state law. This rule also 
does not have tribal implications because it will not have a 
substantial direct effect on one or more Indian tribes, on the 
relationship between the Federal Government and Indian tribes, or on 
the distribution of power and responsibilities between the Federal 
Government and Indian tribes, as specified by Executive Order 13175, 
``Consultation and Coordination with Indian Tribal Governments'' (65 FR 
67249, November 9, 2000). This rule also does not have Federalism 
implications because it will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, as specified in Executive Order 13132, 
``Federalism'' (64 FR 43255, August 10, 1999). The rule merely proposes 
to approve existing requirements under state law, and does not alter 
the relationship or the distribution of power and responsibilities 
between the State and the Federal government established in the Clean 
Air Act. This proposed rule also is not subject to Executive Order 
13045, ``Protection of Children from Environmental Health Risks and 
Safety Risks'' (62 FR 19885, April 23, 1997) or Executive Order 13211, 
``Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use'' (66 FR 28355 (May 22, 2001), because it 
is not a significantly regulatory action under Executive Order 12866. 
This action will not impose any collection of information subject to 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., 
other than those previously approved and assigned OMB control number 
2060-0243. For additional information concerning these requirements, 
see 40 CFR part 70. An agency may not conduct or sponsor, and a person 
is not required to respond to, a collection of information unless it 
displays a currently valid OMB control number.
    In reviewing State operating permit programs submitted pursuant to 
Title V of the Clean Air Act, EPA will approve State programs provided 
that they meet the requirements of the Clean Air Act and EPA's 
regulations codified at 40 CFR part 70. In this context, in the absence 
of a prior existing requirement for the State to use voluntary 
consensus standards (VCS), EPA has no authority to disapprove a State 
operating permit

[[Page 48406]]

program for failure to use VCS. It would thus be inconsistent with 
applicable law for EPA, when it reviews an operating permit program, to 
use VCS in place of a State program that otherwise satisfies the 
provisions of the Clean Air Act. Thus, the requirements of section 
12(d) of the National Technology Transfer and Advancement Act of 1995 
(15 U.S.C. 272 note) do not apply.

List of Subjects in 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Intergovernmental relations, Operating permits, 
Reporting and recordkeeping requirements.

    Dated: September 5, 2001.
Mike Schulz,
Acting Regional Administrator, Region IX.
[FR Doc. 01-23483 Filed 9-19-01; 8:45 am]
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