c/EPA
United States
Environmental Protection
Agency
Enforcement and
Compliance Assurance
(2201A)
EPA300-N-98-003
March 1998
Audit Policy Update
GTE CORRECTS 600 VIOLATIONS THROUGH
EPA'S SELF-DISCLOSURE POLICY
In the biggest settlement reached un-
der the EPA's Audit Policy, EPA and GTE
Corporation have come to an agreement
that recognizes GTE's cooperation in dis-
closing and resolving 600 violations at
314 GTE facilities in 21 states.
The violations occurred under the
Emergency Planning and Community
Right to Know Act (EPCRA) and the Spill
Prevention Countermeasure and Control
(SPCC) requirements of the Clean Wa-
ter Act (CWA).
The settlement represents the largest
number of sites addressed in a single
settlement using the Agency's
self-disclosure policy, which became
effective January 1996. The settlement
also demonstrates the policy's broad
scope in promoting compliance at facili-
ties nationwide.
"GTE is very pleased to have
resolved these violations detected
during an internal review of the
company's operations. The Policy
is straightforward, easy to
comprehend and it reinforces for
the industry the advantage of self-
policing."
Sheila Harvey
Shaw, Pittman, Potts & Trowbridge
GTE disclosed 511 violations of
EPCRA (failure to notify state agencies
and local fire departments of sulfuric acid
filled batteries at 229 GTE telecommu-
nications sites across the country) and
89 violations of the CWA (failure to de-
velop required SPCC plans for diesel fuel
stored at the facilities). SPCC plans are
required to help prevent or mitigate spills
and keep hazardous chemicals from pol-
luting streams, rivers and other bodies of
water.
The settlement requires the company
to pay a $52,264 penalty, equal to the
amount of money saved by the company
during its period of noncompliance. Of
this amount, $16,708 is attributable to
the CWA violations and $35,556 is for
the EPCRA violations. In light of GTE's
outstanding cooperation in voluntarily
disclosing and promptly correcting, the
Agency, pursuant to the Audit Policy,
waived another $2.38 million in poten-
tial penalties.
SENATE HEARS TESTIMONY ON
EPA's AUDIT POLICY
Steve Herman, EPA's Assistant Administrator for Enforcement and Com-
pliance Assurance, testified before the Senate's Committee on Environ-
ment and Public Works along with industry, state, and public interest group
representatives Oct. 30.
The testimony focused on EPA's progress in implementing its Audit
Policy and whether federal legislation establishing audit privileges
and/or immunities is desirable or necessary.
In his testimony, Mr. Herman reiterated EPA's longstanding opposition
to such secrecy and amnesty legislation, and noted that EPA's Audit Policy
is working extremely well in encouraging audits, disclosures, and cor-
rection of violations. Herman mentioned the GTE settlement involving
correction of 600 violations at 314 facilities, and the disclosures involv-
ing other companies, as evidence of this success.
See SENATE on page 2
Contents...
From the Assistant
Administrator
Steel 'Mini-Mills' Encouraged to
Conduct Self-Audits
Voluntary Disclosure Board
Established for Disclosures
Involving Potential Criminal
Violations
Companies Granted Audit Policy
Relief 4
Small Business Policy Promotes
Assistance, Auditing 6
Information Corner 7
http://es.epa.gov/oeca/apolguid.html
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AUDIT POLICY UPDATE
FROM THE ASSISTANT ADMINISTRATOR
EPA has opened the door for responsible companies
working to stay in compliance with our environmental laws.
Our Audit Policy slashes, and in some cases eliminates,
penalties for those who voluntarily discover, promptly dis-
close and expeditiously correct violations, offering power-
ful incentives for the regulated community to comply. In
addition to success under the Audit Policy, we have had
good results in targeting specific requirements and offering
one-time opportunities to report and correct violations in
exchange for greatly reduced penalties.
As of March 1,247 companies have disclosed environ-
mental violations under EPA's Audit Policy at more than
760 facilities nationally, and EPA has reduced or waived
penalties under the policy for 89 companies at 433 facili-
ties. Under our penalty cap initiatives, 89 companies took
advantage of EPA's one-time offer and submitted 11,000
previously unsubmitted chemical risk studies to the Agency
for review—more studies in this one TSCA 8(e) initiative
than the total number of studies submitted to EPA since
1978.
Also in this issue, we report that 170 companies in the
food manufacturing and processing industry submitted
important information to the Agency and state and local
emergency response personnel concerning hazardous
chemicals stored onsite. As a result of this time-limited
offer by EPA, we have obtained information that local
communities need to effectively develop and implement
emergency response plans for hazardous spills or releases,
and enhance community awareness of the chemical haz-
ards within the local area.
Our results show that companies do not need secrecy or
blanket immunity to meet their obligation to comply with
our environmental laws. They do, however, respond well
to fair and predictable incentives for voluntary compli-
ance. Through our Audit Policy and penalty cap pro-
grams, we will continue to keep the door open for compa-
nies that want to walk through it.
Steven A. Herman
Assistant Administrator for
Enforcement & Compliance Assurance
EPA OFFERS SELF-AUDIT INCENTIVES
TO STEEL 'MINI-MILLS'
Early in fiscal year 1997, EPA's Region 5 office in
Chicago encouraged approximately two dozen small
steel mills ("mini-mills") in the Midwest to conduct
self-audits and disclose potential environmental vio-
lations. Instead of conducting immediate inspections
in this industry sector, EPA educated the regulated
community on the applicable legal requirements and
offered the mills an opportunity to take advantage of
the Audit Policy before inspections planned for later
in the fiscal year. Approximately half of the mini-
mills conducted self-audits and several disclosed vio-
lations. EPA now has inspected most of the facilities
that did not conduct a self-audit.
For further information, contact
Denny Dart at (312) 886-1426
SENATE FROM PAGE 1
Even among the industry witnesses who testified in favor of
federal privilege and immunity legislation, the Committee heard
praise for EPA's Audit Policy. Paul Wallach, a lawyer repre-
senting the National Association of Manufacturers (NAM) and
the Corporate Environmental Enforcement Counsel (CEEC),
remarked that EPA should be commended "for issuing its Audit
Policy and for improving and clarifying the availability of pen-
alty mitigation for responsible entities." At the hearing, Wallach
also told the Committee that EPA was doing a good job imple-
menting its policy. When asked by the Senate Committee if
there were any examples of EPA unfairly or poorly implement-
ing its Audit Policy, Mr. Wallach and the other panelists identi-
fied none.
According to Mr. Wallach, NAM's more than 14,000 mem-
ber companies and subsidiaries, which include approximately
10,000 small manufacturers, are located in every state, indus-
trial sector and produce approximately 85 percent of the goods
manufactured in the United States. CEEC is an organization of
22 diverse major companies, including numerous well-known
Fortune 100 companies.
Full copies of the written testimony submitted by Steve
Herman, Paul Wallach and the other witnesses are available on
the Internet at:
http: //www. senate, go v/~ep w/stmts. htm
February 1998
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AUDIT POLICY UPDATE
Voluntary Disclosure Board
Involving Potential
On Oct. 1, 1997, the Office of Criminal Enforcement,
Forensics, and Training (OCEFT) issued a guidance entitled:
"Implementation of the EPA's Self-Policing Policy for Disclo-
sures Involving Potential Criminal Violations."
This guidance establishes a Voluntary Disclosure Board
(VDB) at OCEFT Headquarters in Washington, D.C., to en-
sure that all disclosures submitted to the Agency under the
Self-Policing Policy involving potential criminal violations are
considered and administered in a consistent and fair manner
nationally, whether the initial disclosure is made to EPA re-
gional offices, Headquarters or one of OCEFT's 40 field of-
fices of the Criminal Investigation Division (CID).
The VDB or Board is comprised of OCEFT senior offi-
cials, as well as a member from the Environmental Crimes
Section of the Department of Justice. The VDB dockets,
monitors, and reviews all requests for treatment under the
policy. Following review of the disclosure and the results of
the criminal investigation, the Board will determine whether
the relevant conditions of the policy have been satisfied and
Established for Disclosures
Criminal Violations
make a recommendation to the OCEFT director, who serves
as the deciding official. The Director will decide if the agency
should recommend whether the disclosing entity not be pros-
ecuted. The final decision to accept the recommendation in
criminal cases exclusively resides with the prosecuting au-
thority in its independent exercise of prosecutorial discretion.
The guidance further clarifies the conditions that are ex-
pected to be met by a disclosing entity in the criminal en-
forcement context, including the terms of cooperation with
any government investigation and steps to assure correction,
remediation and prevention of recurrence. The Board's over-
sight will ensure that a criminal investigation initiated as a
result of a disclosure has sufficient facts to support or oppose
a recommendation that relief under the policy be granted.
For further information contact
Michael Fenders, OCEFT, (202) 564-2480.
Food Products Industry Gets Reduced Penalties For
Disclosing Chemical Inventory Violations
Federal, state and local agencies are
now better prepared to handle emer-
gencies, thanks to information about
hazardous chemical inventories that
nearly 200 food companies provided
in response to a special EPA initiative.
Through this initiative, the compa-
nies submitted previously required in-
formation about stored hazardous
chemicals in response to a time-lim-
ited offer by EPA to reduce penalties
for violations of the reporting require-
ments in the Emergency Planning and
Community Right to Know Act
(EPCRA). As of Feb. 1, 170 com-
panies have submitted hazardous
chemical data and paid individual fines
of $2,000 (totaling $340,000), which
is significantly less than they would
have paid.
February 1998
The EPCRA hazardous chemical in-
ventory report is due annually on
March 1 to state emergency response
commissions, local emergency plan-
ning committees and local fire
departments. Data on hazardous
chemical inventories provided by fa-
cilities are crucial for local communi-
ties to develop and implement emer-
gency response plans effectively for
hazardous spills or releases and to en-
hance community awareness of the
chemical hazards within the local area.
The food products sector was cho-
sen because of the large number of
facilities that store regulated quantities
of hazardous chemicals, including
ammonia, chlorine, and sulfuric and ni-
tric acids. EPA first conducted com-
pliance assistance, followed by this
initiative for failure to submit hazard-
ous chemical inventory information.
This initiative is now concluded and
the sector enforcement agreement is
no longer available. EPA has estab-
lished the EPCRA Hotline
(1-800-424-9346) to provide free
technical assistance to facilities.
For further information, contact
Dean Ziegel at (202) 564-4038 or
Beth Burchard at (202) 564-4117.
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AUDIT POLICY UPDATE
COMPANIES GRANTED AUDIT POLICY RELIEF
Acadia Polymers, Irongate, VA
Ademco, El Paso, TX
Alliant Techsystems, Inc., Toone, TN
ALCOA FujikuraLtd., El Paso, TX
Alyeska Pipeline, Prudhoe Bay, AK (2 facilities)
Armstrong World Industries, Hilliard, OH
ATK North America, Arlington, TX
ARCO - Kuparuk Oil Field, Prudhoe Bay, AK
ARCO - Prudhoe Bay Oil Field, Prudhoe Bay, AK
Austin Sculpture, Pharr, TX
Auto Trim, Inc., Brownsville, TX
Baldwin Piano & Organ, Trumann,
Bortec Industrial Inc., El Paso, TX
BP Exploration - Duck Island Endicott, Endicott Island, AK
BP Exploration - Milne Point Unit, Milne Point, AK
BP Exploration - Sourdough Exploration, Sourdough, AK
BP Exploration - Western Oper. Unit, Prudhoe Bay, AK
BP Exploration & Oil, Inc., Houston, TX
BP Exploration & Oil, Inc., Port Angeles, WA
Burlington Northern Santa Fe, 4028 Deen Rd., Fort Worth, TX
Burlington Northern Santa Fe, 4200 Deen Rd., Fort Worth, TX
Burlington Northern Santa Fe, Silsbee, TX
Burlington Northern Santa Fe, Brownwood, TX
Burlington Northern Santa Fe, Temple, TX
Burlington Northern Santa Fe, Somerville, TX
Burlington Northern Santa Fe, Amarillo, TX
California Cooperative Creamery, Petaluma, CA
Carolina Power & Light, New Hill, NC
CENEX, Laurel, MT
CENEX, Denver, CO
CENEX, Inver Grove Heights, MN
CENEX, Rhame,ND
Chevron Chemical Company, San Ramon, CA
Citiplate, Inc., Jackson, TN
Clearwater Co., Pittsburgh, PA
Coilcraft, Inc., El Paso, TX
Cook Composites & Polymers, N. Kansas City, MO
Cook Inlet Pipe Line Co., Drift River, AK
DeKalb Genetics Corp, DeKalb, IL.
Emerson Electric Co., Paragould, AR
EPSON Portland, Inc., Hillsboro, OR
Fiber Resin Corp. (H.B. Fuller), Chatsworth, CA
Foster Products Corp. (H.B. Fuller), Houston, TX
Frederick Manufacturing Corp., Kansas City, MO
General Electric Corp., Waterford, NY
Gobar Systems, Inc., Brownsville, TX
Goulston Technologies, Inc., Monroe, NC
GTE Corporation, Stamford, CT (314 facilities in 21 States)
Hasbro, Inc., El Paso, TX
H.B. Fuller Company, Warren, MI
H.B. Fuller Company, Wilmington, MA
H.B. Fuller Automotive Products, Dayton, OH
H.B. Fuller R&D Pilot Facility, Vadnais Heights, MN
Invacare, Inc., McAllen, TX
ITT Automotive, Laredo, TX
Kaneka Texas Corp., Pasadena, TX
Kennecott Greens Creek Mining Co., Admiralty Island, AK
Kingsford Products, Inc., Louisville, KY
Audit Settlements by Statute
Percentages reflect the number of facilities settling under the policy.
February 1998
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AUDIT POLICY UPDATE
COMPANIES GRANTED AUDIT POLICY RELIEF
Kinross Mining Company, Silver City, ID
Koch Refining Co., Corpus Christi, TX
Lambda Electronics, Inc., McAllen, TX
Lane Supply, Inc., Arlington, TX
Magnetek, Inc., Brownsville, TX
Metromedia Technologies, Inc., Los Angeles, CA
Microfoam Corp., Utica, NY
Midwestern Machinery, Minneapolis, MN
Mikron Industries, Inc., Kent, WA
Milliken & Company, Spartanburg, SC
Minolta Co., Ramsey, NJ
Mozel, Inc., St. Louis, MO
NCI Building Systems, Chester, SC
Norton Company, Stephenville, TX
Occidental Chemical Co., Pasadena, TX
Olin Corporation, East Alton, IL
O'Neill Industries, Philadelphia, PA
Outboard Marine Corp., El Paso, TX
Owens Corning, Amarillo, TX
Ozark-Mahoning Co., Tulsa, OK
Paramount Packaging Co., Longview, TX
Pete's Refrigeration, Bluefield, WV
Pfizer, Inc., Lincoln, NE
Randall Manufacturing, Inc., Weidman, MI
Raychem Corp., Fuquay-Verina, NC
Reliable Pharmaceutical Corp., Overland, MO
Sampson Coatings, Richmond, VA
Shure Brothers, Inc., El Paso, TX
Siemens Electromechanical Co., El Paso, TX
Signet Graphics, St. Louis, MO
Simplot Dairy Products, Nampa, ID
Facilities Disclosing Violations
350
Solomon Corporation, Solomon, KS
Stepan Company, Millsdale, IL
Sunbeam-Oster Co., Bay Springs, MS
Sunbeam-Oster Co., Coushatta, LA
Sunbeam-Oster Co., Hattiesburg, MS
Sunbeam-Oster Co., McMinnville, TN
Sunbeam-Oster Co., Neosho, MO (2 facilities)
Sunbeam-Oster Co., Shubata, MS
Sunbeam-Oster Co., Waynesboro, MS
Teccor Electronics, Inc., Brownsville, TX
Thomson Saginaw Ball Screw, Saginaw, MI
Transportation Electronics, El Paso, TX
TRW Vehicle Safety Systems, McAllen, TX
TRW Automotive Products Remfg., McAllen, TX
Union Carbide Corp., Garland, TX
Union Carbide Corp., Hahnville, LA
Union Carbide Corp., Seadrfit Plant, TX
Union Carbide Corp., Texas City, TX (Main Plant) - #1
Union Carbide Corp., Texas City, TX (Main Plant) - #2
Union Carbide Corp., Texas City, TX (Marine Terminal)
Union Pacific Resources, Carthage, TX
University of Iowa, Iowa City, IA
Unocal Corp., Cook Inlet, AK
Vastar Resources, Inc., La Plata County, CO
Victoreen, Brownsville, TX
V-S Precision, El Paso, TX
Web Inks Ltd., Kennesaw, GA
Wells Manufacturing Co., McAllen, TX
Witco Corporation, Olathe, KS
Zeneca, Inc., Wilmington, DE
Audit Policy Update
Documents concerning the development of the Audit
Policy, settlements under the policy, and additional
copies of this Update, can be obtained by contacting
the Audit Policy Docket located in Room 4033 of the
Ariel Rios Building (1200 Pennsylvania Avenue, N.W.,
Washington, D.C.), by calling(202) 564-2119 or (202)
564-2614, or by Faxing requests to (202) 501-1011.
Energy Communications Chemical Household Goods Misc.
February 1998
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AUDIT POLICY UPDATE
EPA's Small Business Policy Promotes
Compliance Assistance and Auditing
EPA's Small Business Policy pro-
motes environmental compliance by
providing incentives, such as penalty
waivers and penalty mitigation, to those
small businesses that participate in
onsite compliance assistance programs
or conduct environmental audits to dis-
cover, disclose and correct violations.
A small business may be eligible un-
der the Agency's "Policy on Compli-
ance Incentives For Small Businesses"
to have all potential penalties for non-
compliance waived if the companies
agree to come into compliance and
meet other criteria.
The Small Business Policy:
• allows small businesses to get
anonymous government-sponsored
compliance assistance and still get
penalty reductions or waivers if they
disclose and correct their viola-
tions; and
• provides an extended compliance
period for small businesses that
employ pollution prevention
methods to correct their violations.
Onsite compliance assistance in-
cludes information or assistance pro-
vided by EPA, a state or another gov-
ernment agency or government-sup-
ported organization during a visit to the
facility to help the business comply
with environmental requirements.
States and EPA Regions may conduct
compliance assistance visits or, through
their compliance assistance programs,
can identify other governmental orga-
nizations that provide onsite compli-
ance assistance.
To Whom Does the Policy Apply?
The policy applies to a person, cor-
poration, partnership, or other organi-
zation that employs 100 or fewer indi-
viduals. EPA will eliminate its penalty
against the small business if:
• the business receives onsite
compliance assistance or conducts
an environmental audit;
• the business identifies the
violation(s) through the assistance
or audit, and discloses it within 10
days (or such shorter period
provided by law) to the appropriate
government agencies;
• it is the first violation of the
requirement in a three-year period
and no environmental enforcement
actions against the business have
been taken in the last five years;
• the violation is corrected within
180 days after detection of the
violation (or 360 days if pollution
prevention is employed); and
• the violation has not caused actual
serious harm, and does not pose a
potentially imminent and substantial
endangerment to the public or
environment, does not involve
criminal conduct, and did not result
in a significant economic benefit
(which EPA anticipates will occur
infrequently).
EPA is marketing this easy-to-under-
stand policy in a number of small busi-
ness industry sectors, including dry
cleaners and owners or operators of
solvent cleaning machines that use par-
ticular halogenated solvents
(degreasers). Other small businesses
to which this policy may apply include,
but are not limited to, industrial organic
chemical manufacturers, the chemical
preparations industry, construction,
automotive service and repair shops,
landowners/farmers, privately-owned
drinking water systems, electroplaters,
small quantity generators and fuel
blenders.
For further information on the
policy contact Karin Leff at (202)
564-7068.
11,000 Risk Studies Submitted to EPA
Under Compliance Audit Program (CAP)
Eighty nine companies voluntarily reported possible violations
to EPA in return for reduced civil penalties under the TSCA 8(e)
CAP initiative.
TSCA 8(e) requires chemical manufacturers to inform EPA of
any information about mixtures or substances that may present "a
substantial risk of injury to health or the environment." One hun-
dred and twenty-three companies undertook internal environmen-
tal audits under the initiative; 34 reported no 8(e) violations.
The remaining 89 participating companies submitted 11,000 stud-
ies to the Agency for review. These previously unsubmitted
studies more than total the number of studies submitted to
the EPA since 1978.
The information provided in these studies is important
because it provides EPA the information it needs to limit
or prohibit the use of chemicals that pose an unreasonable
risk to health or the environment. EPA continues to evalu-
ate the studies and is reviewing companies with similar pro-
cesses to determine if they should be submitting 8(e) stud-
ies.
For further information, contact
Mark Garvey at (202) 564-4168.
February 1998
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AUDIT POLICY UPDATE
INFORMATION CORNER
(clip and save)
WHOM TO CALL FOR AUDIT POLICY RELIEF
Regulated entities that wish to take advantage of the Policy should fax or send a written disclosure to the
appropriate EPA contacts listed below. Note that the written disclosure must be made within 10 days of the
violation's discovery:
EPA Office States Contact Phone # FAX #
Region 1 (CT,ME,MA,NH,PJ,VT)
Region 2 (NJ,NY,PR,VI)
Region 3 (DE,DC,MD,PA,VA,WV)
Region 4 (AL,FL,GA,KY,MS,NC,SC,TN)
Region 5 (IL,IN,MI,MN,OH,WI)
Region 6 (AR,LA,NM,OK,TX)
Region 7 (IA,KS,MO,NE)
Region 8 (CO,MT,ND,SD,UT,WY)
Region 9 (AZ,CA,HI,NV)
Region 10 (AK,ID,OR,WA)
HQ-Criminal Enf. All potential criminal violations
HQ-Multimedia Enf. Civil violations of >1
EPA Statute in >1 EPA Region
HQ-Quick Response Team Civil violations in
>1 EPA Region but under
only one EPA statute
Suzanne Parent
John Wilk
Samantha Fairchild
Bill Anderson
TinkaHyde
Barbara Greenfield
Becky Dolph
Michael Risner
Leslie Guinan
Jackson Fox
Roy Kime
Melissa Marshall
Gary Jonesi
(617) 565-3351
(212) 637-3918
(215) 566-2999
(404) 562-9655
(312) 886-9296
(214) 665-2210
(913) 551-7281
(303) 312-6890
(415) 744-1339
(303) 312-1073
(202) 564-2539
(202) 564-6002
(202) 564-4002
(617) 565-1141
(212) 637-4035
(215) 566-2905
(404) 562-9663
(312) 353-1120
(214) 665-7446
(913) 551-7925
(303) 312-6953
(415) 744-1041
(303) 312-0163
(202) 501-0599
(202) 564-9001
(202) 564-0011
EPA HOMEPAGE
http://www.epa.gov
OECA HOMEPAGE
http://es.epa.gov/oeca
OECA POLICY & GUIDANCE
http://es.epa.gov/oeca/polguidO.html
AUDIT POLICY INTERPRETIVE GUIDANCE
http://es.epa.gov/oeca/auditpol.html
AUDIT POLICY
http://es.epa.gov/oeca/apolguid.html
SMALL BUSINESS POLICY
http://es.epa.gov/oeca/smbusi.html
WEBSITE INFO
AUDIT GUIDANCE FOR CRIMINAL VIOLATIONS
http ://es .epa.gov./oceft
Audit Policy QRT
The Audit Policy "Quick Response Team" was developed to ensure that determinations for eligibility under the Audit Policy are quick, fair
and consistent nationally. The QRT assists EPA regional offices, the Department of Justice and the public by interpreting the policy's
applicability, particularly in cases of first impression. The QRT is made up of senior staff from EPA Headquarters, Regions and the Depart-
ment of Justice. The Audit QRT Chair is Gary Jonesi (202-564-4002).
February 1998
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The Audit Policy Update is published periodically for the Assistant Adminstrator for Enforcement and Compliance Assurance by its Office of
Regulatory Enforcement. The Update is intended to provide information to the public and regulated communities regarding developments
under the EPA Audit Policy. Editor: Virginia Bueno, (202) 564-8684. Email: bueno.virginia@epamail.epa.gov. Graphic Artist: Sarah
Weaver, weaver.sarah@epamail.epa.gov.
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