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[Federal Register: December 7, 2004 (Volume 69, Number 234)]
[Rules and Regulations]
[Page 70557-70562]
DEPARTMENT OF THE INTERIOR
Office of the Secretary
Bureau of Land Management
43 CFR Parts 44 and 1880
RIN 1093-AA09
Payment in Lieu of Taxes
AGENCY: Office of the Secretary; Bureau of Land Management, Interior.
ACTION: Final rule.
SUMMARY: This rule amends the Code of Federal Regulations to reflect
the transfer of responsibility for operating the Payment in Lieu of
Taxes (PILT) program from the Bureau of Land Management to the
Department of the Interior (``DOI''), Office of the Secretary.
DATES: Effective Date: December 7, 2004.
FOR FURTHER INFORMATION CONTACT: Bill Howell, OS, Office of Budget,
(202) 208-5308 (Commercial or FTS). Persons who use a
telecommunications device for the deaf (TDD) may call the Federal
Information Relay Service at 1-800-877-8339, 24 hours a day, seven days
a week, to contact Mr. Howell.
SUPPLEMENTARY INFORMATION:
I. Background
II. Final Rule as Adopted
III. Procedural Matters
I. Background
This rule moves the existing regulations at 43 CFR 1881 to 43 CFR
Part 44 to reflect the transfer of responsibility for operating the
PILT program from the Bureau of Land Management to the Office of the
Secretary, DOI.
Elevating PILT to the Department level streamlines the budget
process, eliminates the competition for dollars at the agency level,
and ensures that appropriate emphasis can be directed to PILT as
necessary, with a multibureau, Departmental funding contribution. This
is a benefit that would accrue to Congress, the Department, BLM, and to
the counties as well.
This rule is an administrative action to reassign PILT
responsibilities from one office to another. The changes in the
regulations pursuant to the notice consist of moving the implementing
regulations from one CFR part to another. There is no substantive
change in the Department's PILT responsibilities. Therefore, DOI has
determined that it has no substantive impact on the public and for good
cause finds under 5 U.S.C. 553(b)(B) and 553(d)(3) that notice and
public procedure thereon are unnecessary and that this rule may take
effect upon publication.
II. Final Rule as Adopted
The Department adopts the revisions to 43 CFR that deletes subpart
1881 and inserts new Part 44 to reflect the transfer of responsibility
for operating the PILT program from the Bureau of Land Management to
the Department of the Interior, Office of the Secretary.
III. Procedural Matters
Executive Order 12866, Regulatory Planning and Review
This rule is not a significant rule and was not subject to review
by the Office of Management and Budget under Executive Order 12866. The
Office of Management and Budget has determined that this rule: Does not
have an annual economic impact of $100 million or more; will not have
an adverse impact in a material way on the economy, productivity,
competition, jobs, the environment, public health or safety, or State,
local, or tribal governments or communities; does not pose a serious
inconsistency or interfere with an action taken or planned by another
agency; does not alter the budgetary effects of entitlements, grants,
user fees, or loan programs or the right or obligations of their
recipients; and will not have novel legal or policy implications.
Therefore, we do not have to assess the potential costs and benefits of
the rule under section 6(a)(3) of this order. The rule is
administrative in nature, simply transferring a function from one
bureau to a Secretarial office.
Regulatory Flexibility Act
This rule does not require a regulatory flexibility analysis.
Congress enacted the Regulatory Flexibility Act of 1980 (RFA), as
amended (5 U.S.C. 601-612), to ensure that Government regulations do
not necessarily or disproportionately burden small entities. The RFA
requires a regulatory flexibility analysis if a rule has a significant
economic impact, either detrimental or beneficial, on a substantial
number of small entities. This rule would not have significant economic
impacts on small entities under the RFA (5 U.S.C. 601 et seq.). The
rule is administrative in nature, simply transferring a function from
one bureau to a Secretarial office.
Small Business Regulatory Enforcement Fairness Act
This rule is not a ``major rule'' as defined by the Small Business
Regulatory Enforcement Fairness Act (5 U.S.C. 804(2)). This rule will
not have a significant impact on the economy or on small businesses in
particular. As discussed above, this rule would update existing
regulations to incorporate statutory changes to the authorizing
legislation and do not affect small businesses.
Unfunded Mandates Reform Act
This rule does not impose an unfunded mandate on State, local, or
tribal governments or the private sector of more than $100 million per
year; nor do these proposed regulations have a significant or unique
effect on State, local, or tribal governments or the private sector.
The rule is administrative in nature, simply transferring a function
from one bureau to a Secretarial office. Therefore, BLM is not required
to prepare a statement containing the information required by the
Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.)
Executive Order 12630, Governmental Actions and Interference With
Constitutionally Protected Property Rights (Takings)
This rule does not represent a government action capable of
interfering with constitutionally protected property rights. Therefore,
we have determined that the regulation would not cause a taking of
private property. No further discussion of takings implications are
required under this Executive Order.
Executive Order 13132, Federalism
This rule will not have a substantial direct effect 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. The rule is administrative in nature, simply
transferring a function from one bureau to a Secretarial office.
Therefore, in accordance with Executive Order 13132, BLM has determined
that this proposed rule does not have sufficient Federalism
implications to warrant preparation of a Federalism Assessment.
National Environmental Policy Act (NEPA)
This rule is subject to a categorical exclusion under NEPA. The
Department has determined that this action to transfer responsibility
of the PILT Act is a regulation of financial, technical, and legal
nature under section 101(2)(C) of the National Environmental Policy
Act, pursuant to 516 Departmental Manual, Chapter 2, Appendix 1, Item
1.10. Therefore, pursuant to the Council on Environmental Quality
regulations (40 CFR 1508.4) and the environmental policies and
procedures of the Department of the Interior, the Department has found
that neither an environmental assessment nor an environmental impact
statement is required.
Executive Order 13175, Consultation and Coordination With for Indian
Tribal Governments
In accordance with Executive Order 13175, we have found that this
rule does not include policies that have tribal implications. The rule
is administrative in nature, simply transferring a function from one
bureau to a Secretarial office.
Executive Order 12988, Civil Justice Reform
The Office of the Solicitor has determined that this rule will not
unduly burden the judicial system and that it meets the requirements of
sections 3(a) and 3(b)(2) of Executive Order 12988.
Author: The principal author is Bill Howell, Budget Group,
assisted by John Strylowski, Office of Executive Secretary.
Paperwork Reduction Act of 1995
These regulations contain information collection requirements. As
required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et
seq.), we submitted a copy of the proposed information collection
requirements to the Office of Management and Budget (OMB) for review.
The Department will not require collection of this information until
OMB has given its approval.
Executive Order 13211, Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution or Use
In accordance with Executive Order 13211, BLM has determined that
the proposed rule will not have substantial direct effects on the
energy supply, distribution, or use, including a shortfall in supply or
price increase.
List of Subjects
43 CFR Part 44
Administrative practice and procedure, Financial assistance-local
governments, Grant programs-natural resources, Land Management Bureau,
Loan programs-natural resources, Payments in lieu of taxes, Public
lands, Public lands-mineral resources.
43 CFR Part 1880
Administrative practice and procedure, Financial assistance-local
governments, Grant programs-natural resources, Land Management Bureau,
Loan programs-natural resources, Payments in lieu of taxes, Public
lands, Public lands-mineral resources.
Dated: November 22, 2004.
J. Steven Griles,
Deputy Secretary of the Interior.
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For the reasons set forth in the preamble, subtitle A and Chapter II of
title 43 of the Code of Federal Regulations are amended as set forth
below:
43 CFR Subtitle A--Office of the Secretary of the Interior
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1. Part 44 is added to read as follows:
PART 44--FINANCIAL ASSISTANCE, LOCAL GOVERNMENTS
Sec.
General Information
44.10 What is the purpose of this subpart?
44.11 What are the definitions of terms used in this subpart?
44.12 Who is eligible to receive PILT payments?
Payments to Local Governments Containing Entitlements Lands
44.20 How does the Department process payments to local governments
whose jurisdictions contain entitlement lands?
44.21 How does the Department calculate payments to local
governments whose jurisdictions contain entitlement lands?
44.22 Are there any special circumstances that affect the way the
Department calculates PILT payments?
44.23 How does the Department certify payment computations?
44.30 How does the Department make payments for acquired lands?
44.31 How does the Department calculate payments for acquired lands?
Payments to Local Governments for Interest in Lands in the Redwood
National Park or Lake Tahoe Basin
44.40 How does the Department process payments for lands in the
Redwood National Park or Lake Tahoe Basin?
44.41 How does the Department calculate payments for lands in the
Redwood National Park or Lake Tahoe Basin?
State and Local Governments' Responsibilities After the Department
Distributes Payments
44.50 What are the local governments' responsibilities after
receiving payments under this part?
44.51 Are there general procedures applicable to all PILT payments?
44.52 May a State enact legislation to reallocate or redistribute
PILT payments?
44.53 What will the Department do if a State enacts distribution
legislation?
44.54 What happens if a State repeals or amends distribution
legislation?
44.55 Can a unit of general local government protest the results of
payment computations?
44.56 How does a unit of general local government file a protest?
44.57 Can a unit of general local government appeal a rejection of a
protest?
Authority: Public Law 94-565, 90 Stat. 2662, as amended, 31
U.S.C. 6901-6907.
General Information
Sec. 44.10 What is the purpose of this subpart?
This subpart sets forth procedures the Department of the Interior
uses in disbursing Federal payments in lieu of taxes to local
governments for entitlement lands within their boundaries.
Sec. 44.11 What are the definitions of terms used in this subpart?
Entitlement land means land owned by the United States:
(1) That is in the National Park System or the National Forest
System, including wilderness areas, and national forest lands in
northern Minnesota described in 16 U.S.C. 577d-577d-1;
(2) That is administered by the Secretary of the Interior through
the Office of the Secretary;
(3) That is dedicated to the use of the Government for water
resource development projects;
(4) On which there are semiactive or inactive installations,
excluding industrial installations, that the Department of Army keeps
for mobilization and reserve component training;
(5) That is a dredge disposal area under the jurisdiction of the
Army Corps of Engineers;
(6) That is located in the vicinity of Purgatory River Canyon and
Pinon Canyon, Colorado, and was acquired by the United States after
December 23, 1981, to expand the Fort Carson military installation; or
(7) That is a reserve area as defined in 16 U.S.C. 715s(g)(3),
which is an area of land withdrawn from the public domain and
administered, either solely or primarily, by the Secretary of the
Interior, through the Fish and Wildlife Service.
Local government means a unit of general local government, which
can include any of the following:
(1) A county, parish, township, borough, or city, (other than in
Alaska), where the city is independent of any other unit of general
local government, that:
(i) Is within the class(es) of such political subdivision in a
State that the Secretary of the Interior determines, in his or her
discretion, to be the principal provider(s) of governmental services
within the State; and
(ii) Is a unit of general local government, as determined by the
Secretary of the Interior on the basis of the same principles as were
used by the Secretary of Commerce on January 1, 1983, for general
statistical purposes;
(2) Any area in Alaska that is within the boundaries of a census
area used by the Secretary of Commerce in the decennial census, but
that is not included within the boundaries of a governmental entity
described under paragraph (1) of this definition; or
(3) The Governments of the District of Columbia, the Commonwealth
of Puerto Rico, Guam, and the Virgin Islands.
Payments in lieu of taxes (PILT) means Federal payments disbursed
to local governments to compensate for the exemption of real estate
taxes on entitlement lands within their boundaries.
Section 6902 (31 U.S.C. 6902) payments means Federal payments
disbursed to local governments containing entitlement lands.
Section 6904 (31 U.S.C. 6904) payments means Federal payments
disbursed to local governments for acquisitions or interest in lands
acquired for addition to the National Park System or National Forest
Wilderness Areas.
Section 6905 (31 U.S.C. 6905) payments means Federal payments
disbursed to local governments for lands in the Redwood National Park
or Lake Tahoe Basin.
Sec. 44.12 Who is eligible to receive PILT payments?
(a) Each local government containing entitlement lands may receive
a PILT payment.
(b) A local government may not receive a payment for land owned or
administered by a State or local government that was exempt from real
estate taxes when the land was conveyed to the United States. However,
a local government may receive a PILT payment for land when:
(1) A State or local government acquires from a private party to
donate to the United States within eight years of acquisition;
(2) A State acquires through an exchange with the United States if
the land acquired was entitlement land; or
(3) In the State of Utah, that the United States acquires for
Federal land, royalties or other assets if, at the time of acquisition,
a local government was entitled to receive payments in lieu of taxes
from the State of Utah for the land; provided that the payment to the
local government does not exceed the payment the State would have
disbursed if the land had not been acquired.
Payments to Local Governments Containing Entitlement Lands
Sec. 44.20 How does the Department process payments to local
governments whose jurisdictions contain entitlement lands?
This section describes how the Department processes payments to
local governments whose jurisdictions contain entitlement lands
(section 6902 payments).
(a) The Department:
(1) Determines the eligibility of each local government, conferring
when necessary with the Bureau of the Census, officials of appropriate
State and local governments, and officials of the agency administering
the entitlement land;
(2) Computes the amount of the payment disbursed to each local
government; and
(3) Certifies the amount of the payment disbursed to each local
government.
(b) The Department disburses a payment each fiscal year to each
local government containing entitlement lands.
(c) The State of Alaska is required to distribute the payment it
receives to home rule cities and general law cities (as such cities are
defined by the State) that are located within the boundaries of the
local government entitled to the payment.
Sec. 44.21 How does the Department calculate payments to local
governments whose jurisdictions contain entitlement lands?
(a) To calculate section 6902 payments, the Department obtains the
necessary data on Federal and State payments from several sources:
(1) Federal agencies provide the amount of entitlement land within
the boundaries of each local government as of the last day of the
fiscal year preceding the fiscal year for which the Department
disburses the payment;
(2) The Governor or designated official provides the amount of
money transfers (land revenue sharing payments) disbursed by the State
during the previous fiscal year to eligible local governments under the
payment laws listed under 31 U.S.C. 6903(a)(1) and in paragraph (d) of
this section; and
(3) The Bureau of the Census provides statistics on the population
of each local government.
(b) The Department consults with the affected local government and
the administering agency to resolve conflicts in land records and other
data sources.
(c) The Department calculates the amount of payment using:
(1) The amount of actual appropriations;
(2) The formula in 31 U.S.C. 6903(b)(1), which includes inflation
adjustments; and
(3) Federal and State payments disbursed during the previous fiscal
year to local governments under the land payment laws listed under 31
U.S.C. 6903(a)(1).
(d) The laws listed in 31 U.S.C. 6903(a)(1) and referred to in
paragraphs (a) and (c) of this section are:
(1) The Act of June 20, 1910 (Arizona and New Mexico Enabling Acts)
(ch. 310, 36 Stat 557);
(2) Section 33 of the Bankhead-Jones Farm Tenant Act (7 U.S.C.
1012);
(3) The Act of May 23, 1908 (Knutson-Vandenberg Act regarding
Forest Service timber sales contracts) (16 U.S.C. 500);
(4) Section 5 of the Act of June 22, 1948 (Payments to Minnesota
from northern Minnesota National Forest receipts) (16 U.S.C. 577g-l);
(5) Section 401(c)(2) of the Act of June 15, 1935 (Payments to
local governments from National Wildlife Refuge System receipts) (16
U.S.C. 715s(c)(2));
(6) Section 17 of the Federal Power Act (16 U.S.C. 810);
(7) Section 35 of the Act of February 25, 1920 (Mineral Leasing
Act) (30 U.S.C. 191);
(8) Section 6 of the Mineral Leasing Act for Acquired Lands (30
U.S.C. 355);
(9) Section 3 of the Act of July 31, 1947 (Materials Act of 1947)
(30 U.S.C. 603); and
(10) Section 10 of the Act of June 28, 1934 (Taylor Grazing Act)
(43 U.S.C. 315i).
Sec. 44.22 Are there any special circumstances that affect the way
the Department calculates PILT payments?
If a local government eligible for payments under this subpart
reorganizes, the Department will:
(a) Calculate payments for the fiscal year in which the
reorganization occurred as if the reorganization had not occurred; and
(b) Disburse any payment due to each new unit based on the amount
of eligible acreage in that unit.
Sec. 44.23 How does the Department certify payment computations?
(a) The Department will certify a payment computation only after
receiving a statement showing all land revenue sharing payments that
each local government received from the State during the previous
fiscal year. As used in this paragraph, ``land revenue sharing
payments'' means payments made from revenues derived from the payment
laws listed under 31 U.S.C. 6903(a)(1). The statement must:
(1) Be signed by the Governor or a designated official of the State
in which the local government is located; and
(2) Be accompanied by a certification, signed by a State Auditor,
an independent Certified Public Accountant, or an independent public
accountant, that the statement has been audited in accordance with:
(i) Auditing standards established by the U.S. Comptroller General
in Standards of Audit of Governmental Organizations, Programs,
Activities and Function, (available from the Superintendent of
Documents, U.S. Government Printing Office, Washington, DC 20402); and
(ii) The Audit Guide for Payments in Lieu of Taxes issued by the
Department of the Interior.
(b) The Department's Office of the Inspector General will assist
the Department, under the provisions of sections 4 and 6 of the
Inspector General Act of 1978 (5 U.S.C. Appendix), to implement and
administer the audit requirements in paragraph (a)(2) of this section.
(c) The Office of the Inspector General will:
(1) Develop appropriate audit guidelines that State auditors,
independent Certified Public Accountants, or independent public
accountants must use to audit the statements of the Governors or their
designated officials and to certify the audits; and
(2) Furnish copies of the guides to the Governor or designated
official each year. You should send questions on the use or application
of this guide to the Office of Inspector General, U.S. Department of
the Interior, Washington, DC 20240.
(d) The Department may waive the requirement to certify audits if
the General Accounting Office or the Office of the Inspector General
verifies the information in statements the Governor or designated
official furnishes or if the Department determines it is not necessary.
Payments to Local Governments for Acquisitions or Interest in Lands
Acquired for Addition to the National Park System or National Forest
Wilderness Areas (31 U.S.C. 6904).
Sec. 44.30 How does the Department make payments for acquired lands?
This section describes how the Department disburses payments for
Acquisitions or Interest in Lands Acquired for Addition to the National
Park System or National Forest Wilderness Areas (section 6904
payments).
(a) The Department disburses section 6904 payments to qualified
local governments only if the administering agency supplies the
following information for each qualified local government:
(1) Acreage or interests in land for which the payments are
authorized; and
(2) Any other information the Department may require to certify
payments to each qualified local government.
(b) The Department disburses payments under this section only for a
period of 5 years from the date the land was conveyed to the United
States.
Sec. 44.31 How does the Department calculate payments for acquired
lands?
The Department calculates section 6904 payments by determining 1
percent of the fair market value of the purchased land and comparing
the result to the amount of real estate taxes paid on the land in the
year before Federal acquisition. The payment to qualified local
governments will be the lesser of the two.
Payments to Local Governments for Interest in Lands in the Redwood
National Park or Lake Tahoe Basin
Sec. 44.40 How does the Department process payments for lands in the
Redwood National Park or Lake Tahoe Basin?
This section describes how the Department disburses payments for
lands in the Redwood National Park or Lake Tahoe Basin (section 6905
payments).
(a) The Department disburses payments to qualified local
governments only if the administering agency supplies the following
information for each qualified local government:
(1) Acreage or interests in land for which the payments are authorized; and
(2) Any other information the Department may require to certify
payments to each qualified local government.
(b) The Department disburses payments until 5 percent of the fair
market value is paid in full.
Sec. 44.41 How does the Department calculate payments for lands in
the Redwood National Park or Lake Tahoe Basin?
(a) The Department calculates section 6905 payments by determining
1 percent of the fair market value of the purchased land and comparing
the result to the amount of real estate taxes paid on the land in the
year prior to Federal acquisition. The payment to qualified units of
general local government will be the lesser of the two.
(b) The Department disburses payments annually for a period of 5
years beginning in the year immediately following the year of Federal
acquisition of the land or interest.
(1) The difference, if any, between the amounts actually paid
during each of the 5 years and 1 percent of the fair market value will
be deferred to future years. However, a payment or any portion of a
payment not paid because Congress appropriated insufficient monies will
not be deferred.
(2) The Department will begin annual payment of the deferred amount
(calculated the same as in paragraph (a) of this section) starting with
the sixth fiscal year following Federal acquisition.
(3) The Department disburses payment of the deferred amount until
the total amount deferred during the first 5 years is paid in full.
State and Local Governments' Responsibilities After the Department
Distributes Payments
Sec. 44.50 What are the local governments' responsibilities after
receiving payments under this part?
(a) The local government may use section 6902 payments for any
governmental purpose.
(b) Within 90 days of receiving sections 6904 and 6905 payments,
the local government must distribute the funds to the affected units of
general local government and affected school districts. The affected
units of general local government and school districts may use sections
6904 and 6905 payments for any governmental purpose.
(c) The local government must distribute section 6904 and 6905
payments in proportion to the tax revenues assessed and levied by the
affected units of general local government and school districts in the
Federal fiscal year before the Federal Government acquired the
entitlement lands. The Redwoods Community College District in
California is an affected school district for this purpose.
(d) Within 120 days of receiving payments, the local government
must certify to the Department that it has made an appropriate
distribution of funds.
Sec. 44.51 Are there general procedures applicable to all PILT
payments?
(a) The minimum payment that the Department will disburse to any
local government is $100.00 (one hundred dollars).
(b) If Congress appropriates insufficient monies to provide full
payment to each local government during any fiscal year, the Department
will reduce proportionally all payments in that fiscal year.
Sec. 44.52 May a State enact legislation to reallocate or
redistribute PILT payments?
A State may enact legislation to reallocate or redistribute PILT
payments. If a State enacts legislation, it must:
(a) Notify the Department if the legislation requires reallocating
or redistributing payments to smaller units of general local government
(see 31 U.S.C. 6907);
(b) Provide the Department a copy of the legislation within 60 days
of enactment;
(c) Provide the name and address of the State government office to
which the Department should send the payment;
(d) Distribute funds to its smaller units of general local
government within 30 days of receiving the payment; and
(e) Not reduce the payment made to smaller units of general local
government to pay the cost of State legislation which reallocates or
redistributes payments.
Sec. 44.53 What will the Department do if a State enacts distribution
legislation?
If a State enacts distribution legislation, the Department will:
(a) Notify the State that a single payment will be disbursed to the designated
State government office beginning with the Federal fiscal year following the
fiscal year in which the State enacted legislation; and
(b) Provide the State with information that identifies the entitlement lands
data on which the Department bases the payment.
Sec. 44.54 What happens if a State repeals or amends distribution
legislation?
(a) If a State repeals or amends distribution legislation, the
State must immediately notify the Department in writing of this fact
and send the Department a copy of the new law.
(b) When the Department receives a notification under paragraph (a)
of this section, it must:
(1) Determine if the State's process complies with 31 U.S.C. 6907.
If the Department determines that it does not, we must notify the
designated State government office that the Department will disburse
payment directly to the eligible local governments; and
(2) Start the payments:
(i) In the current Federal fiscal year, if the Department receives
a copy of the State's amendatory legislation before July 1; or
(ii) Start the payments in the next Federal fiscal year, if the
Department receives a copy of the State's amendatory legislation after
July 1.
Sec. 44.55 Can a unit of general local government protest the results
of payment computations?
Any affected local government may file a protest with the
Department.
Sec. 44.56 How does a unit of general local government file a
protest?
The protesting local government must:
(a) Submit evidence to indicate the possibility of errors in the
computations or the data on which the Department bases the computations; and
(b) File the protest by the first business day of the calendar year
following the end of the fiscal year for which the Department made the
payments.
Sec. 44.57 Can a unit of general local government appeal a rejection
of a protest?
Any affected local government may appeal the Department's decision
to reject a protest to the Interior Board of Land Appeals under 43 CFR
part 4.
43 CFR CHAPTER II--BUREAU OF LAND MANAGEMENT, DEPARTMENT OF THE
INTERIOR
PART 1880--[AMENDED]
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2. Subpart 1881 (Sec. Sec. 1881.10 through 1881.57) is removed.
[FR Doc. 04-26803 Filed 12-6-04; 8:45 am]
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