Congressional Outlook 2007 | January 22, 2007 Issue - Vol. 85 Issue 4 | Chemical & Engineering News
Volume 85 Issue 4 | pp. 27-34
Issue Date: January 22, 2007

Congressional Outlook 2007

Democrats pledge to tackle long-term budget challenges, increase oversight of Administration programs
Department: Government & Policy
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Hearings
Democrats plan to hold more oversight hearings on Administration programs than did the previous Congress.
Credit: Peter Cutts Photography
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Hearings
Democrats plan to hold more oversight hearings on Administration programs than did the previous Congress.
Credit: Peter Cutts Photography

THE DRAMATIC SHIFT in power in the federal government—with both the House of Representatives and the Senate coming under the control of the Democrats this year—guarantees a lot of debate but does not ensure much progress. The 110th Congress faces many of the same issues as the last one, especially the war in Iraq and national security problems, and these concerns will continue to dominate national debate.

There are a number of science and technology issues—environmental rules, stem cell research, pharmaceutical safety, energy production—that are high priorities for the Democrats. The party, however, has only slim voting majorities, especially in the Senate, which will make controversial legislation as difficult to pass this year as it was last year.

Democrats in the House did, however, manage to push through several bills on their agenda during the much-publicized "first 100 hours" legislative blitz. These include a stem cell research bill and bills to raise the minimum wage and tighten ethics rules.

As always, a big stumbling block will be passing the federal budget. The Democrats have pledged to do better at completing the budget process than did the Republicans, but money will be extremely tight this year, and most discretionary programs, including research and development, could actually see reductions in their funding.

First sessions of a new Congress are always filled with anticipation as members have a clean slate to work with. But these are contentious times, and progress will be hard. The following is C&EN's annual outlook of what to expect from Congress in the months ahead.

ECONOMY & BUDGET. Democratic leaders have already changed the budget process for this year by deciding to not vote on the nine appropriations bills that were not passed by the previous Congress. Instead, they will simply continue fiscal 2006 funding levels for the government through the rest of fiscal 2007.

This giant continuing resolution, expected from the Democrats but not yet introduced, is expected to include corrections to a few department budgets, most likely those of the Department of Veterans Affairs and the Department of Justice. Although some money would be expected to be saved by this process, discretionary spending at the science funding agencies is likely to be lower than anticipated for this year.

To smooth work on the budget for 2008, both the House and Senate have realigned their appropriations subcommittees so that each has the same responsibilities. The Republican-controlled House changed its appropriations subcommittees two years ago, but the Senate did not go along, resulting in an awkward misalignment of jurisdictions. In each body, there are now 12 subcommittees, each producing its own spending legislation.

The Democrats also are pledging to do better than the Republicans have in balancing the federal budget. Although the annual deficit has been falling slightly over the past few years, long-term challenges to the budget, such as reforming Social Security, remain. The new chairman of the House Budget Committee, John M. Spratt Jr. (D-S.C.), has said a cap needs to be imposed on discretionary spending. And there will be an attempt to impose a strict "pay-as-you-go" rule on the budget that will require any increases in spending, even increases in so-called entitlement costs such as Social Security and Medicare, to be offset with revenue increases.

The previous Congress passed a tax reform bill at the end of December that preserved many of the tax cuts passed over the past six years, but Democrats already have a few tax issues of their own. Senate Finance Committee Chairman Max Baucus (D-Mont.), for example, has already introduced a bill that would permanently extend the highly popular research and development tax credit. His plan includes changing the formula for claiming the R&D credit, basing it on actual research spending instead of a company's gross receipts.

Baucus also says he wants to repeal the unpopular alternative minimum tax, which ensnares millions of middle-class tax payers every year, increasing their tax bills. Getting rid of the tax would cost the treasury about $60 billion a year, however, and Baucus included no mechanism to make up for this loss.

HOMELAND SECURITY. The Democrat-controlled Congress got off to a roaring start in the area of homeland security with passage in the House of a bill implementing many of the outstanding reforms recommended by the 9/11 Commission. In 2004, the bipartisan commission set up to investigate the 2001 terrorist attacks offered some 41 recommendations to improve homeland security. The Republican-led 109th Congress, by some estimations, implemented about half of them.

The nearly 300-page bill, containing 14 major initiatives, received overwhelming acceptance during the floor vote on Jan. 9, passing by a vote of 299 to 128. Several of its provisions, however, are expected to face stiff opposition in the Senate. At press time, no companion Senate bill had been introduced, but any resulting bill is expected to differ significantly from the House bill.

Introduced by Rep. Bennie G. Thompson (D-Miss.), chairman of the House Homeland Security Committee, the House bill, H.R. 1, "Implementing the 9/11 Commission Recommendations Act of 2007," largely fulfills a key part of the Democrats' first 100-hour agenda.

The bill sets a distribution formula for homeland security grants to states and localities based on terrorism risks and mandates scrutiny of all U.S.-bound air and ship cargo within three to five years. Although both measures have come in for much criticism, the 100% cargo inspection provisions especially have been deemed too costly and not yet technically feasible. They are likely to be hotly contested in the Senate.

The House bill contains no cost estimates for implementing any of its measures. It does, however, include provisions for improving communications among first responders during disasters, stemming the spread of weapons of mass destruction, and strengthening the powers of an existing civil liberties board that oversees U.S. antiterrorism efforts. In addition, H.R. 1 requires the homeland security secretary to assess yearly the vulnerability of the nation's critical infrastructure.

Absent in the House bill is a key recommendation of the 9/11 Commission: Strengthening and streamlining congressional oversight of intelligence and counterterrorism efforts.

Thompson has made H.R. 1 key to his agenda for his Homeland Security Committee, which, at press time, was still being organized. Thompson's spokeswoman, Dena Graziano, says the committee will hold a hearing this week "on the state of the Department of Homeland Security and, next month, will hear from Secretary Michael Chertoff on DHS's budget."

The House committee "will look into rail and mass transit security," Graziano says. But oversight of DHS will be a principal committee focus, especially "the problems plaguing DHS's chemical security regulations."

Late last December, DHS released draft chemical plant security regulations that largely track efforts the chemical industry has voluntarily undertaken. The rules leave vulnerability assessments to the companies, but DHS would determine whether the assessments were adequate. DHS will receive comments on the draft regulations until Feb. 7 and, by law, must issue final rules by April 4.

The Senate Homeland Security Committee, chaired by Sen. Joseph I. Lieberman (I-Conn.), began "the 110th Congress developing legislation to implement the outstanding 9/11 Commission recommendations," says spokeswoman Leslie Phillips. Lieberman said at a Jan. 9 committee hearing that he planned to mark up a bill within weeks that would pass the Senate by the end of January.

On the issue of plant security, Phillips says Lieberman "will oversee implementation of chemical security provisions contained in the [fiscal] 2007 DHS appropriations bill," but she could not yet offer further details. In cooperation with ranking member Sen. Susan M. Collins (R-Maine), Lieberman will focus heavily on DHS oversight, Phillips says.

According to Collins spokeswoman Jen Burita, the senator's priorities include "continued examination of DHS's budget, programs, and priorities," including Chertoff's reorganization efforts, and "DHS responsibilities for national pandemic planning." Also of high interest to Collins is ongoing oversight "of DHS efforts to identify vulnerabilities and threats to critical infrastructure" and of DHS's chemical plant security regulations, Burita says.

Lieberman and Collins worked closely last year in developing legislation—which President George W. Bush recently signed into law—to strengthen the structure of the federal emergency management system. Both senators plan to keep a watchful eye on implementation of that law to make sure congressional intent is carried out.

As in the past, DHS will also receive oversight from the appropriate House and Senate appropriations subcommittees. And as chairman of the House Oversight & Government Reform Committee, Rep. Henry A. Waxman (D-Calif.) will likely keep a keen eye on DHS's contracting efforts, which has been a particular concern of his in the past. Sen. Barbara Boxer (D-Calif.), chair of the Senate Environment & Public Works Committee, is reported to have said her committee would assume oversight of DHS's chemical plant security efforts, but committee staffers could offer no details.

ENERGY. Global warming, ethanol, renewable energy, incentives for coal-to-liquid-fuel production, new efficiency standards for appliances and vehicles, and oil and gas drilling are just some of the energy-related issues House and Senate members say they intend to take up in the new Congress.

This year and next could be pivotal for U.S. energy policy, congressional staff and Congress members say. However, they warn not to expect many blockbuster energy bills such as the Energy Policy Act of 2005. Instead, smaller and issue-specific "freestanding" legislation is more likely, which may be passed alone or bundled with similar bills on the House and Senate floors, says Bill Wicker, Democratic Party communications director for the Senate Energy & Natural Resources Committee.

However, the legislation could be far-reaching with great impact. Consider that this year a national farm bill is up for reauthorization, and momentum for climate- change legislation is growing fast.

The Senate???with its 51-to-49 party split and a requirement of 60 votes to avoid a filibuster and ensure bill passage???is likely to have the fullest legislative debate and the most give-and-take among members. Consequently, both Majority Leader Harry Reid (D-Nev.) and Senate Energy Committee Chairman Jeff Bingaman (D-N.M.) have already stressed their desire to encourage bipartisan support for legislation with hearings and public debate.

Wicker expects the Senate process on energy legislation to be deliberate and discussions to be complicated as most bills will carry provisions affecting a wide range of interests and requiring approval by several committees. For instance, he notes that although the Senate Agriculture, Nutrition & Forestry Committee has primary jurisdiction over a farm bill, the energy title in that bill would spread jurisdiction in part to Bingaman's Energy Committee, the Environment & Public Works Committee, and the Finance Committee.

On Jan. 10, the Senate Energy & Natural Resources Committee and the Agriculture Committee held their first hearings, and both concerned energy. The Energy Committee held a general discussion of global oil supplies and how they may change. This was to set the stage for several energy hearings to follow.

The Senate Agriculture, Nutrition & Forestry Committee took up biofuels and provisions to be included in the 2007 farm bill. In the view of the committee chairman, Tom Harkin (D-Iowa), energy will be the engine driving the farm bill, says Harkin's spokesman Tom Reynolds.

Although the last farm bill, passed in 2002, held an energy title, senators at the January hearing noted that ethanol production has shot up since then. Now, for instance, much of the committee discussion focused on concerns that ethanol demand is leading to record-high corn prices and that livestock and poultry farmers are being hurt by high prices for feed corn.

Senators and witnesses discussed policies to reach a balance for rural America to encourage ethanol production without harming other corn users. They sought ways to encourage technologies leading to the production of ethanol from cellulose, giving some relief to corn demand.

However, Harkin and corn producers at the hearing wanted to maintain the high demand for corn, as it is leading an economic upturn in rural America. They would simply like to bring in cellulosic ethanol as well.

A Department of Agriculture official noted that the next three years would be critical to sustaining long-range ethanol production, and the committee's farm state senators discussed bill language that would help their states provide biomass feedstocks for the growing ethanol marketplace.

Harkin and House Agriculture Committee Chairman Collin C. Peterson (D-Minn.) both intend to pass legislation through their committees before the August recess, staff say. They predict many hearings and a busy agenda.

On global warming, Senate Environment & Public Works Committee Chairman Boxer has claimed primary jurisdiction for her committee. She announced that the committee's first hearing on global warming would be held on Jan. 30 and would serve to "take the pulse" of the Senate. Her approach is unusual: Boxer has invited any senator who wishes to testify on climate change to do so during an open committee hearing.

More than a dozen legislative approaches to combat climate change are expected, congressional staff say, and bills could be directed at everything from increasing auto efficiency to more efficient coal plants. As leader, Boxer represents a sharp change from past committee chairman Sen. James Inhofe (R-Okla.), a vigorous climate-change skeptic who blocked the committee from even taking up the issue.

On the House side, its Energy & Commerce Committee has primary jurisdiction over climate change. Committee Chairman Rep. John D. Dingell (D-Mich.) has identified climate change as an issue the committee must address and has invited former vice president Al Gore and others to testify. In the past, Dingell, a longtime ally of the auto industry, has been lukewarm on efforts to reduce carbon emissions, particularly when the proposals pertain to policies that encourage auto and utility efficiency. A committee staff member says no dates have been set for hearings.

The committee's minority will be led by former House speaker Dennis Hastert from the coal state of Illinois.

In other legislation, several bills from the previous session are likely to be reintroduced. For instance, Bingaman is expected to reintroduce provisions that require 10% of U.S. energy to come from renewable sources by 2020. Such a provision cleared the Senate three times in past years but was blocked in the House. With the House in Democratic hands, aides say, the odds on passage are much better.

Also, House Democratic Party leaders have announced their intention to repeal subsidies given to oil companies and to take back drilling royalty payments that were inadvertently given out in the 1990s for leasing on offshore lands. They intend to shift these funds to investments in renewable energy programs. The Senate has also shown concern over offshore-drilling lease irregularities. But leadership there has announced its intention to hold hearings and possibly offer legislation to address problems in oil and gas drilling and royalty payments, according to Senate staff members.

The brisk pace of onshore federal leasing for oil and gas drilling in the West is likely also to be examined in the Senate. "We keep hearing about more and more access to federal lands, and senators are going to take a closer look at this," says a Senate staff member. "We are getting objections from property owners in western lands, and we hear complaints about the gazillions of acres already under lease. We'd like to know what is going on with this program."

In other areas, Sen. Daniel Inouye (D-Hawaii), chairman of the Senate Commerce Committee, just announced his intention to introduce and hold hearings on legislation requiring increased vehicle efficiency. Increasing such a bill's probability for passage was a surprise announcement from Sen. Ted Stevens (R-Alaska) that he would introduce a bill in support of better vehicle efficiency standards. Stevens has historically opposed vehicle efficiency improvements, but his bill would raise passenger vehicle efficiency standards from 27.5 miles per gal to 40 mpg by 2017. A Senate staff members adds: "Stevens has taken a greater interest in global warming impacts over the last few years, but this was a surprise. On the other hand, the guy's state is melting."

Also expected are bills to encourage a variety of energy efficiency and conservation goals. Specifically, staff say, bills will be introduced to encourage consumers and the federal government to purchase more energy-efficient lighting and to put a greater emphasis on appliance efficiency standards.

Interest in energy issues in Congress is growing and is coming from unexpected places. Early in the new congressional session, Rep. Tom Lantos (D-Calif.), chairman of the Committee on Foreign Affairs, said he would expand the agenda of his committee to include the development of alternative fuels as well as energy conservation.

He noted that "our actions with respect to other countries can be distorted by our dependence upon oil from overseas. I want us to move in a meaningful way toward alternative fuels and to place more emphasis on conservation in this country, as we have done under previous presidential leadership."

ENVIRONMENT. In addition to her plans to move on climate-change issues, Boxer has several pollution-related issues on the agenda for her committee. But with the Democrats holding a slim two-vote majority in the Senate, most of those plans involve improved oversight of Envionmental Protection Agency programs and recent agency actions, rather than new legislation.

Boxer intends to hold a series of hearings scrutinizing EPA actions taken in the past six weeks that she views as regulatory rollbacks. Those hearings are expected to start in February.

Among the EPA actions Boxer is targeting is a rule the agency issued last month that sharply curtails the amount of information that tens of thousands of facilities supply about their toxic releases under the federal community right-to-know law. Another is a final rule, issued in November 2006, that allows the application of pesticides on or near bodies of water without a Clean Water Act permit.

Also, Boxer said she plans to examine EPA's reasoning for a final rule, officially issued on Jan. 4, that did not list perchlorate, a chemical used to manufacture rocket fuel that has tainted some water sources, among the unregulated contaminants in drinking water that utilities must monitor. The proposed version of that rule included perchlorate, but EPA said in the final regulation that it has enough data on this chemical, which can affect iodine uptake by the thyroid gland.

Boxer has introduced a bill (S. 24) that would force EPA to require utilities to monitor their water for perchlorate. She is also sponsoring another measure (S. 150) that would require EPA to provide information to drinking water regulators on the human health effects of perchlorate.

The chairman is taking aim, too, at a controversial EPA rule proposed last month that changes the way carcinogens and other hazardous compounds are regulated under the Clean Air Act. Environmental groups and others say the proposal, which is supported by industry groups including the American Chemistry Council, could allow companies that have already curbed their emissions of these toxic pollutants to boost their releases.

"This proposal will allow thousands more pounds of cancer-causing air pollution to be emitted each year," Boxer says. "People living near refineries, hazardous waste incinerators, and chemical plants will be forced to breathe more toxic air pollution."

Boxer's committee will also scrutinize the Bush Administration's new streamlined review process for setting health-based standards for the quality of the nation's air. Announced last month, that process enhances the role of political appointees and, critics say, diminishes the role of agency scientists and its external science advisers. EPA intends to use this process for the first time as it decides whether to scrap the national standard for the allowable amount of lead in air. Boxer and six other Democrats on the Environment & Public Works Committee wrote to EPA Administrator Stephen L. Johnson on Dec. 21, 2006, asking him to discard the new process.

Boxer is also concerned about the lack of money to clean up abandoned hazardous waste sites under the Superfund law. She cites internal EPA documents that indicate that the program needs $1.25 billion more than the agency has to clean up Superfund sites. Hearings on this EPA program are likely to start in the Subcommittee on Superfund & Environmental Health, now chaired by Sen. Hillary Rodham Clinton (D-N.Y.).

As of mid-January, House committees had no clear schedule for legislation or oversight hearings on pollution-related matters. However, the Energy & Commerce Committee is likely to look into electronic waste recycling and disposal, perchlorate in drinking water, funding for Superfund cleanups, and EPA enforcement, a House aide tells C&EN.

DRUG POLICY. A lot of Democratic effort in the 110th Congress is likely to involve some aspect of regulating pharmaceuticals-pricing, safety, importation from foreign countries, and direct-to-consumer advertising. Already, Reps. Dingell and Charles Rangel (D-N.Y.) have introduced the "Medicare Prescription Drug Price Negotiation Act" (H.R. 4), which would repeal the current provision that prohibits the secretary of Health & Human Services (HHS) from bargaining for lower drug prices for some 40 million Medicare recipients.

However, the bill would prohibit the government from establishing a formulary; that is, a select list of drugs approved for reimbursement under Medicare Part D. This means the Center for Medicare & Medicaid Services (CMS) would not be able to bargain down a drug price by threatening a company that it would disallow purchases of its product under Medicare plans. The bill has already passed in the House but faces opposition in the Senate.

Senate Finance Committee Chairman Baucus plans to hold hearings on the issue before the details of a companion bill are worked out in the Senate. The American Association of Retired Persons, AFL-CIO, Consumers Union, and Families USA support H.R. 4, but CMS and some large pharmaceutical firms oppose it. CMS claims that H.R 4 would "require limiting access to some drugs while promoting others in exchange for price discounts." The Congressional Budget Office released a letter on Jan. 10 that concludes the drug price negotiations required under the bill would save little or no money. This finding is likely to influence the debate in the Senate, where there is more skepticism about the legislation.

The drug pricing issue has not escaped the notice of the White House, either. President Bush has already notified Congress he will veto the pricing negotiation bill if it comes to his desk.

A bill that would allow the controversial importation of pharmaceuticals was introduced in the Senate and House on Jan. 10 by a bipartisan group of legislators. The "Pharmaceutical Market Access & Drug Safety Act of 2007" would allow wholesalers, pharmacies, and individuals to import drugs approved by the Food & Drug Administration from Canada and other countries permitted by the HHS secretary. Individuals could order drugs directly from Canada if they are using an FDA-approved pharmacy. The aim of the legislation is to make drugs more affordable by putting an end to monopoly pricing, says Sen. Byron Dorgan (D-N.D.). According to the bill, drug prices in other industrialized countries are 35 to 55% lower than in the U.S.

The Pharmaceutical Research & Manufacturers of America adamantly opposes the legislation. "Simply put, there is absolutely no way to guarantee the safety and efficacy of medicines imported from Canada," says PhRMA Senior Vice President Ken Johnson. "Importation schemes undermine the U.S. government's ability to assure us that our drug supply is safe and secure and can expose Americans to counterfeit drugs." Furthermore, he says, "Canadian authorities report that counterfeit drugs are being sold in their country at alarming rates."

Similar legislation stalled in past Congresses, but the prospects for passage appear better this year. Democratic leaders have promised a vote on the bill in the House, and Dorgan predicts a favorable vote in the Senate. "This Congress needs to pass reimportation because prescription drugs are the foundation of modern medicine-not only for seniors, but for every American," says Rep. Rosa L. DeLauro (D-Conn.), who chairs the House Appropriations Subcommittee on Agriculture, Rural Development, Food & Drug Administration & Related Agencies.

The drug importation bill will face stiff opposition from HHS and the White House.

DeLauro and other lawmakers also plan to try to increase FDA funding for generic drug approval and for the agency's office that monitors the safety of drugs after they are approved. There is a large backlog of generic drug applications at the agency, and faster approval of the drugs would tend to lower prices. Over the past few years, there has been much criticism of FDA's tracking of the safety of approved drugs. For example, pharmaceutical firms that are asked to perform additional safety studies of new medicines often fail to do so.

Another Democratic goal is to rein in direct-to-consumer (DTC) advertising. A Government Accountability Office report issued last December found that FDA has limited ability to curb the distribution of misleading and false DTC ads. The agency has no power to fine a company for sponsoring a misleading ad. It can only send out warning letters, which are issued on average eight months after the first misleading ad appears, GAO said. DeLauro plans to reintroduce a bill from the past Congress that would ban DTC advertising of new drugs for three years.

But lawmakers' efforts to limit or ban DTC advertisements and improve the safety of marketed drugs may be short-circuited by FDA's own proposals for the reauthorization of the Prescription Drug User Fee Act. The act must be reauthorized this year, as it is every five years.

In a proposal published in the Federal Register on Jan. 11, FDA recommends that annual user fee collections by the agency be increased by $87 million to $393 million. The largest part of the additional funds would be used to track the safety of medications after they are on the market. In addition, FDA proposes the creation of a separate program to collect user fees from drug companies that seek advisory reviews of their DTC television ads. The agency estimates that these fees would support 27 additional staff to carry out the reviews.

Another issue that will likely be the subject of hearings this year is safety of the nation's food supply. Most observers expect that Democrats in Congress will once again try to create a single food safety agency that would have regulatory jurisdiction over all types of food. Currently, food safety functions are split primarily between USDA, which has jurisdiction over meat and poultry, and FDA, which controls fruits, vegetables, and fish. The recent Escherichia coli contamination problems with fresh produce—primarily spinach and lettuce—have given rise to calls from many consumer and health groups for a new food administration.

SCIENCE POLICY. One of the hottest issues in Congress this year is likely to be the federal support of embryonic stem cell research. Led by the Democrats' push to expand the human embryonic stem cell federal policy, congressional hearings are expected to focus on research and the potential of embryonic and adult stem cells, as well as on the impact of the recently reported isolation of stem cells from human amniotic fluid.

As one of its highest priorities, the House has already passed by a vote of 253 to 174 a bill that expands the federal policy on embryonic stem cell research. The Senate is expected to follow suit in the next few weeks. The bill passed by the House (H.R. 3) is identical to the legislation introduced and passed in the 109th Congress, then vetoed by President Bush. Authored by Reps. Diana DeGette (D-Colo.) and Michael N. Castle (R-Del.), the bill would allow researchers to use federal funds to study stem cell lines derived from human embryos that were originally created for fertility treatments but which are no longer needed and are scheduled to be discarded as medical waste. It would not allow embryos to be created solely for research.

The Administration has already issued a statement reaffirming Bush's position that the current policy is adequate and promising another veto if such a bill makes it to his desk. It is unclear whether the House and Senate have the necessary votes to override the President's veto.

Congress will also renew its push to pass legislation, stalled in the previous Congress, that will improve U.S. competitiveness and innovation. The Senate is expected to introduce related legislation soon, and the House has already introduced a trio of bills that will serve as the cornerstone of the Democrats' Competitiveness & Innovation Agenda.

Two of the House bills aim to increase the number of math and science teachers, to authorize funding increases for physical sciences at key agencies, and to provide other resources for physical science research. The third bill of the package would create an Advanced Research Projects Agency for Energy.

Whenever there is a change in the majority in Congress, there are a number of shifts and adjustments that take place. The 110th Congress is no different, and one of the changes is a new name for the key House committee with jurisdiction over a wide range of science policy issues. The old Science Committee has been renamed the Science & Technology Committee, under the chairmanship of Rep. Bart Gordon (D-Tenn.).

Under its revised name, the Science & Technology Committee has set out an agenda for this year that includes overseeing of the National Aeronautics & Space Administration, ensuring adequate federal support for basic research, increasing U.S. energy independence, and continuing to make sure U.S. workers are prepared to compete in the global economy.

 
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