Thursday, July 29, 2021

"SHE FOOLED ME." La Politica Rocked By Stapleton Scandal; House Leader Alleged To Have Stolen Nearly $1 Million From APS In Decade Long Scheme; Will She Resign? How Could Crime Go So Long? Where Was The Oversight? Plus: GOP Surprises With Weak Scandal Reaction; The Big News, Analysis And Context Are Up Next  

Rep. Sheryl Williams Stapleton
Friday afternoon Rep. Stapleton announced she is resigning from her House seat. 

"She fooled me." That was a common refrain in La Politica Wednesday as law enforcement agents swooped down on the ABQ home of state House Majority Leader Sheryl Williams Stapleton seeking evidence that she stole nearly $1 million from her employer, the ABQ Public Schools. 

Veteran lawmakers and operatives seemed genuinely stunned at the scope of the alleged rip off and it's long lasting nature. The scheme allegedly went on for ten long years. They know Democrat Stapleton, the first African-American woman elected to the NM legislature, as a determined, driven politician who has climbed the ranks of leadership since first being elected in 1994. She had a couple of ethical lapses in that time but nothing prepared them for the political bombshell that exploded over the state Wednesday like a neutron bomb. "She fooled me." Several acquaintances confessed.

There were oversight failures on multiple fronts sure to have repercussions. APS Superintendent Scott Elder admitted the failure and apologized. “The internal processes failed to stop this fraud." 

Elder tipped off the Attorney General's office in April which then obtained search warrants, including for Stapleton's SE Heights home and APS headquarters. .

Search warrant here. Search warrant highlights here. Stapleton bio here.

But it wasn't only APS coming under scrutiny for the latest corruption shocker. What about the state Public Education Department (PED)? AWOL? And where were the last three state auditors, asked many observers. 

That office is charged with auditing the schools or approving of outsider auditors to do so. Dem Attorney General Balderas, who is in command of this investigation, served as Auditor when the scheme allegedly began in 2012. He was followed by Dem Tim Keller, now ABQ Mayor, who was followed by current Auditor Brian Colón. 

Keller did wave a red flag over APS in 2016 when the school system relocated the Internal Audit Unit to the Accounting Office which he said would weaken the unit. But no one apparently came close to suspecting Stapleton of the racketeering and money laundering which the AG says she engaged in. 

Perhaps that's a sign that she kept the illegal operation close to her vest and that the circle will not expand much beyond her. Still, previous APS Superintendents and others will come under close scrutiny and grilled on what happened. 

During a previous APS finance mess, it was proposed that the school system, with a budget of well over $1 billion when federal funding is included, hire an Inspector General to supervise the cash flow as is done in New York and LA.

One concern: If Stapleton was indeed conducting a rogue operation, are others going unnoticed and that brighter lights would expose? 


Alright, let's get to what you want to know--the political impact. 

Will Stapleton resign and when? 

If, as expected, the AG files official charges against her, the odds of a resignation go way up. With 26 years of legislative service she would be entitled to a state pension of about $26,000 a year plus a pension from her $78,000 APS job that would be in the $60,000 range. If she is convicted of a felony those pensions are rescinded. We are checking to see if the law now allows pensions that are collected before a conviction to be revoked if a public official is eventually convicted. 

However, she is known for digging in and a trial or plea bargain could be many months away. If she stays, the end could come in the June 2022 Democratic primary for her House seat. Not to say that her trial could not end in an acquittal but that trial could be a year or more away.

What happens to her leadership position? 

In the chaotic aftermath of the search warrant raid no one really knows. House Dems are still digesting the news and feeling the shock waves. But there is one possible solution floating. 

That would be to have the House Dem Caucus tap outgoing State Rep. Daymon Ely as a temporary House Majority Leader. That would spare the Dems the unenviable task of picking an immediate replacement for Stapleton and dealing with infighting. Ely could keep the position through the the November '22 election, the theory goes. 

On the other hand, ambitious House members may want a permanent replacement and soon. There's little question that the party must soon strip Stapleton of her title to minimize the political fallout. 

What happens to her House seat if she resigns? 

She represents District 19 in the uber-liberal House District 19 in the ABQ SE Heights. If she resigns the Dem controlled Bernalillo County Commission will name her replacement. There would sure to be a crowded field of progressives applying. Dem Party Vice-Chair David Montoya is one of the first to say he is in the race.

Can the Republican Party take advantage of the scandal?

Chairman Pearce
It could and should but it is off to a very anemic start. This statement had the Alligators and Wall-Leaners scratching their heads:

Elected officials at all levels ask for and receive public trust. It's one of the most basic elements of successful self-governance. When that trust is violated by any elected official, it affects the public trust of all elected officials. The allegations against Rep. Williams Stapleton involve this public trust and as such must be taken seriously, but not all of the facts are out. We must wait for more information and for the investigation to take its course. If the allegations prove true, they are a disturbing violation of the sacred public trust.

Two of the three leading GOP candidates for the '22 Guv nomination--Zanetti and Dow—were quiet on social media about the sensational news but Jay Block hit the Republican mark, calling for Stapleton to resign. “The state is full of corruption. . . .These career politicians don’t care about us, just lining their pockets,” Block blasted. 

Analysts offered a variety of theories for the GOP's vanilla response. 

1. Maybe they feared being blasted as racists if they went after Stapleton hard. Better to wait. 

2. The scandal involves a private company's contract with APS and the GOP is all about privatizing education. The news disrupts that cherished GOP notion. 

3. What if the investigation widens into other contractors that could snare Republicans? So take it slow.

Take your pick. For whatever reason, the GOP again showed a lack of nimbleness that is essential if they're to have a shot at taking out MLG. 

One GOP consultant said the fresh scandal was a prime opportunity lost by the R's to hammer the state's Dems over this alleged corruption as well as allegations of bid rigging at CYFD.

What about the Governor? 

Her statement was actually stronger than the GOP's led by Chair Steve Pearce. She didn't break into a full run to get away from Stapleton but she did trot:

 I am deeply, deeply troubled by the reports about a law enforcement investigation into Rep. Stapleton. People are innocent until proven otherwise, and I know investigators will follow the facts wherever they lead. I await more information like all New Mexicans. But I will say that public confidence in government is seriously damaged by even the appearance of impropriety, or illegal activity, which is why public officials must always hold themselves to the highest possible standard of behavior. New Mexicans expect and deserve elected officials who, regardless of party, will put the people before themselves. Anything less violates a sacred public trust and must be dealt with accordingly.

Not earthshaking, but enough in light of the GOP holding their punches. And the hint of the beginnings of a push to ease out Stapleton came with the line, "damaged by even the appearance of impropriety."

Does this news give AG Balderas a reprieve from the ethics complaint filed against him over the PNM Avangrid merger? 

For a while but on the same day his agents searched Stapleton's home news came that the Public Regulation Commission staff has determined that Balderas must respond to the conflict charges he calls "frivolous." Over the short term the story could hibernate but the long term implications remain. The AG did make a good pivot away from his troubles with the Stapleton case.  

How will this impact the upcoming APS School Board election?

For the first time the school board voting will take place at a regular election--the city election November 2--instead of the traditional February time. The law was changed to increase voter participation and it will surely do that. And the narrative for that election is set. What will the candidates for the four seats on the ballot do to prevent future scandals that besmirch the reputation of the state's largest school system? The low-key election is suddenly higher profile with the media and public looking for answers.

Down the list of importance but still coming up: Will the Sheryl Williams Stapleton African American Performing Arts Center at the Fairgrounds lose her name? 

If she is convicted that could happen. Former Dem State Senator Manny Aragon lost the honor of having a building named for him at the Hispanic Cultural Central when he was convicted of corruption charges. 


Stapleton turns 64 tomorrow on what will be one of her most unhappiest of birthdays. She was born in the Virgin Islands, moved to NY then Chicago and on to ABQ. Investigators are checking her Virgin Islands bank account as they explore money laundering charges. 

She holds a Ph.D in education, started out as an elementary teacher and worked herself up to a top administrative APS post. She is a formidable personality who fellow politicos are careful not to tangle with. She's politically savvy, too, having served a stint as state Dem Party Chair. The search warrant also notes that she may have used her powerful legislative position to direct funds to the education program she was allegedly looting for that cool million.

Who will Rep. Stapleton lawyer up with? Not known yet but Dem trial attorney Sam Bregman would seem a natural. Or maybe Bob Gorence, another aggressive advocate. Only those who can stand the hottest temperatures in the political kitchen need apply. (Ahmed Assed is quoted as her current attorney.)

We mentioned earlier this week that Democrats must be wary of corruption allegations when their majorities are this fat, or risk losses at the ballot box. Do we need to repeat that?


We led off the Wednesday blog with news that ABQ attorney Vince Ward was a leading candidate to become the next US Attorney for New Mexico. But Ward came with a statement in response to that report that he has withdrawn from the running. His explanation is now on the Wednesday blog. 

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Wednesday, July 28, 2021

Dateline DC: Leading Contender Withdraws From US Attorney Consideration; Xochitl Hearing For Top AG Job Set And Leger Fernandez Brings Home Some Bacon  

Vince Ward
Vince Ward was a leading candidate for US Attorney but shortly after we posted a report about that we received this: .

 I recently withdrew my name from consideration because during the application process DOJ and the Government Ethics Office determined that one of my firm's cases (not a criminal case and not a case in NM) presented a conflict. I worked for several weeks to find a solution to the conflict without success. I am disappointed, but confident that the administration and delegation are vetting a diverse pool of candidates who believe the US Attorney's Office is an important tool for combatting violent crime in NM, promoting civil rights, especially with respect to instances of police misconduct, and strengthening the government-to-government relationship with the many sovereign Nations located around our beautiful State. I appreciate everyone who provided support and advice throughout the arduous vetting process, and I am sorry to disappoint them. 

We had earlier blogged that. . . 

An ABQ lawyer with a distinctly liberal pedigree is the leading contender to become the next US attorney for New Mexico, according to senior sources. Vince Ward, 46, a 2001 UNM School of Law grad, would also be the first African-American to hold the important law enforcement position. 


Rep. Leger Fernandez
Keeping your blog in DC this Tuesday, word there is that the Senate Agriculture Committee confirmation hearing for former southern Dem Congresswoman Xochitl Torres Small will take place Thursday morning. She has been nominated by the president for the position of Under Secretary of Agriculture for Rural Development.

And northern US Rep. Teresa Leger Fernandez had no problem scooping up $74 million in "earmarks" for her sprawling district. Earmarks are back on the Hill after a decade long absence. 

The freshman Democratic lawmaker used most of her cash--$67 million--for the Navajo-Gallup Water Supply Project. The cost of the years-long project that aims to bring reliable water service to more of the Navajo Reservation as well as Gallup has risen to $1.7 billion. A portion of the project has been built. Full completion is predicted for 2029. Leger Fernandez also secured $879,000 for broadband for Española. 

She said:

"I look forward to the Senate reaffirming their commitment to community reflected in our appropriations bills.” This year, the Appropriations Committee allowed each Member of Congress to request funding for up to 10 projects in their community for FY2022 and retained decision making authority to choose projects funded.

The other four members of the state's congressional delegation will also benefit from the return of earmarks. Their appropriations have not yet been announced.


Uh-oh. More government-funded jobs. The economic diversification crowd is going to fall out of their summer hammocks: 

National engineering firm BlueHalo will invest $60 million in a 200,000-square-foot innovation and manufacturing center for space technology and “directed energy” systems at Kirtland Air Force Base, the company announced. The new facility, expected to open in fall 2022, will be the first industrial tenant to set up shop at a planned 70-acre mixed-use site known as MaxQ, which is currently under development on Kirtland property along the south side of Gibson between Carlisle and Truman.

The salaries are in the $90,000 range. Why would you want to "diversify" away from that?

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Tuesday, July 27, 2021

CYFD Scandal: Would Dems Let R's Off This Light? Allegations Of Rigged Contract And Retaliation Cripple Agency Leadership While MLG Is Hands-Off, Plus: AG Responds To Corruption Charges Leveled By Enviros 

CYFD Sec. Brian Blalock (Searchlight NM)
The burgeoning scandal at the state Children, Youth and Families Department (CYFD) involving allegations of a rigged contract to update software and retaliation against whistleblowers who have been questioning the deal has been flying under the radar. But it is a big deal for one of the most crucial cabinet departments in a state riddled with child abuse. 

Pressure may be starting to mount on MLG for sticking to a hands-off posture as the headlines continue to blaze. Reader Anne McKinney writes:

If we had a Republican Governor and a Republican dominated House and Senate, Democrats would be out for "blood," requesting the removal of Secretary Blalock, a clean up and full investigation and major changes at CYFD. However with the good halo and support for Governor MLG and ranks closed, mum seems to be the word. Red flag after red flag is overlooked and okay with all. This is not the way to improve child welfare in NM. 

Some details:

At least half a dozen high-level employees have been reprimanded, resigned or were fired after they raised questions about Binti Inc., the Oakland, California-based tech company now tasked with overhauling the computer system. “I felt like I was doing the right thing by raising these issues, and instead I was let go,” said one of the departed workers who asked not to be named for fear of further retaliation. Some of the employees expressed concerns that Binti had not undergone a proper analysis or review. Others worried whether a company that was little more than a year old when it won the contract could be trusted to modernize one of the state’s most critical and complex systems. Still other staffers questioned why Binti was selected without a competitive bidding process. 

CYFD denies any retaliation but:

Two former employees — Debra and Cliff W. Gilmore — filed a whistleblower lawsuit claiming they were wrongfully terminated in part because they asked questions about Binti. The Gilmores, who were hired in late 2020 to fill high-level positions, had both repeatedly questioned the Binti contract, according to CYFD emails.

If there is a wire job for the $16 million contract, here's how it went down, according to an ethics complaint filed with the AG, Auditor and Ethics Commission

The path to hiring a vendor changed direction in early 2019 when (now CYFD Cabinet Secretary Brian) Blalock and his wife, Linnea Forsythe, were recruited from their jobs in San Francisco to work for Gov.  Lujan Grisham, the complaint states. Forsythe became the Long Term Care ombudsman, but has since moved to the post of interim director of the Governor’s Commission on Disability. Months after his appointment as CYFD Cabinet secretary in 2019, Blalock “pressured CYFD staff to contract with a specific vendor, Binti, for New Mexico’s multi-million dollar CCWIS (comprehensive child welfare information services) project,” the complaint states. It also alleges Blalock told a CYFD chief information officer at the time that his wife “is good friends with the owner” of Binti. Binti’s CEO told the Journal she is not friends with Blalock’s wife, and has met her once, a couple of months ago. 

Then there's the Blalock Bockade featuring secret government communications. But that's another story. 

This is another disappointing and worrisome corruption allegation coming on the heels of those leveled against the attorney general. Blalock was seen as a star addition to CYFD, bringing a badly needed set of outside eyes to an historically troubled department. Now he is mired in muck and has outlived his effectiveness. MLG has let other cabinet secretaries go for lesser reasons. Can't she pull the trigger and get on with a needed culture change at CYFD?


And on the topic of the AG's problems. . .

Attorney General Hector Balderas came with an op-ed response to that ethics complaint filed against him by enviros, including New Energy Economy headed by Mariel Nanasi, over the proposed merger of PNM and Avangrid. However, Balderas does not address the specifics of the corruption allegations made in the complaint that center on his relationship with attorney Marcus Rael from the law firm Robles, Rael & Anaya. Instead Balderas dismisses the complaint as "frivolous:"

The Santa Fe special-interest group opposing the transition took to accusing me of corruption because its principal is so insistent on getting her way, in the face of overwhelming support for the transaction, that she filed a frivolous complaint. This is the same individual who ostracized herself during the passage of the state’s landmark clean-energy legislation, the Energy Transition Act, again because she did not get her way. Let me be clear – this deal will bring hundreds of millions of dollars to New Mexico and actually replace our existing utility with a clean, well-capitalized company, and has centered the needs of Indigenous and poor communities. 

The complaint against Balderas filed with the State Ethics Commission and State Auditor asserts that Balderas switched his position in favor of the Avangrid/PNM merger after visits to him by Rael who had been hired by Iberdrola, the parent of Avangrid. Rael's firm has been awarded a number of contracts to handle major cases for the AG's office. 

The complaint describes Balderas and Rael as "personal friends." The pair went to UNM Law at the same time and they once practiced law together. 

The AG says his shift on Avangrid came because the corporation made consumer-friendly changes to the merger agreement that he negotiated.

It's probably a good time to reiterate that Democrats, by far the state's majority party, don't get thrown out of office for their ideas. They get the swift kick when they bungle management of government and corruption charges--real or alleged--start to stack up. Just sayin'.

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Monday, July 26, 2021

Downtown ABQ Soccer Stadium Put On Fast Track: Keller Wants Nov. Bond Vote But Foes Try To Slow Rush, Plus: All Judges Recused From Hearing Manny Public Money Case; Supremes To Appoint Judge, And: More Political Pain For AG Balderas  

Before we get going please note that Joe Diaz has just issued a flash flood warning for New Mexico political news. We'll do our best to not get stuck in a roaring arroyo as we wade through this unusual summer event, so off we go. . . 

The political angle on the weekend announcement by Mayor Keller that he will seek city council approval of a $50 million bond issue to build a stadium for the United NM soccer team has opponents complaining that besides being a questionable expenditure Keller is trying to stack the deck for the November 2 mayoral election where he faces Sheriff Manny Gonzales. (Video of Keller announcement here.) 

Soccer fans tend to be younger thus presumably lean Democratic and are not a high voting group. Bringing them into the mayoral election to back a stadium bond is seen as a boost for Keller. On the other hand, the prospect of an expensive downtown stadium could wake up conservative voters who will come out to vote against the plan and perhaps vote for Gonzales. 

Opponents of the downtown stadium point out that ABQ voters rejected one at a 2001 special election. It was sold as a means of "revitalizing" the battered area when Mayor Jim Baca pushed the concept. Instead voters approved a $10 million bond to renovate ABQ Isotopes Park, a decision that has stood the test of time. 

As much as they are popular today, the future for NM United could be iffy, if the history of other minor league sports franchises here are any indication. Only one has lasted of the many tried, that being the minor league Isotopes who were preceded by the popular ABQ Dukes. 


Downtown at 2nd and Iron is one of several proposed locations for the stadium as outlined by outside consultants for the city. Coal and Broadway near downtown is another. The Railyards and 12th and I-40 are also mentioned. The study is here.

Putting a stadium downtown, however, would have negligible impact on the down and out downtown which is ensnared in crime, homelessness and has a reputation as a place to stay away from, argues former City Councilor Greg Payne:

"Downtown revitalization" should consist of cleaning up the area, get people living there and make it safe. How about doing that before building a stadium of 10 to 12 thousand that will not even come close to paying for itself? I've been watching these downtown schemes since the 70's. If we are going to have a stadium, why not put it at the sports complex on University where you already have the baseball stadium, the UNM football stadium and the basketball Pit? 

Or another possibility. End governmental tribalism and reach an accord to tear down the aged Tingley Coliseum on the state fairgrounds and build a new multipurpose arena that could host large concerts, soccer, other sports teams and the many NM Expo events. Besides being a showcase for the entire state, Santa Fe could put up a much larger share of the financing of that venture than for a downtown stadium.

The city council in August must approve the $50 million bond issue for it to make the Nov. 2 ballot which also for the first time features ABQ School Board elections that will also spike Democratic turnout. The total stadium cost is put at about $70 million.

The bond would not raise taxes but it would reduce bonding capacity for other vital infrastructure projects such as roads. 

United NM has brought much joy to the city in its short time but asking voter approval of a $50 million bond issue just three months from now looks like a rush job, if not an outright political ploy by the incumbent mayor. 


While a dedicated soccer stadium could be a White Elephant in the city's future, the current state of city budgetary affairs is solid, according to the latest bond ratings. 

The city has earned an Aa3 general obligation (GO) and gross receipt tax (GRT) rating from Moody’s Investors Services—a positive outlook. . . Obligations rated Aa3 are judged to be of high quality and are subject to very low credit risk. 

The bond rating may be obscure to some, but many voters in city elections tilt toward the affluent and are quite aware of their importance. For Keller that's another reason he is in the driver's seat so far in his bid for a second term. 

MAYOR 2021

Eddy Aragon
All the ABQ district court judges have recused themselves from hearing the appeal of BernCo Sheriff Manny Gonzales' public financing case. That means the state Supreme Court will appoint an outside judge to hear the sheriff's appeal of the decision by the city clerk to deny him taxpayer money for his mayoral bid and that should happen this week.

The clerk denied Gonzales $661,000 in public financing because of forgeries involving those $5 donations from individual voters that his campaign was required to collect. The sheriff's campaign has admitted there was forgery of signatures. Keller has qualified for the public cash. 

Also, we've learned that Megan McMillan, a top campaign aide to Gonzales and who the Keller camp asserts was a key player in forging signatures, has left the campaign. Whether she has lawyered up is a matter of speculation.

Then there's radio talker Eddy Aragon, who earlier started a mayoral campaign but then abandoned it, now announcing that he's launching a last minute effort to qualify for the Nov. 2 mayoral ballot. Aragon points out that for the first time there is no Republican choice for mayor and more importantly there is no conservative. So Aragon is trying to collect the required 3,000 petition signatures by the August 10 deadline to make the ballot. Fat chance, says veteran field consultant Steve Cabiedes:

Eddy will need a large and expensive field operation to get 3,000 good signatures. To get there he will need to collect 4,000 or more. He must have paid staff to get the job done in such short order. Volunteers won't cut it. 

So it appears the mayoral derby will stay a two man duel, but we'll keep you posted in case Eddy surprises.


Balderas & Colón
More trouble for Attorney General Hector Balderas. The latest:

Balderas' handling of a now-settled case involving a large solar company is raising concerns. Democratic Rep. Daymon Ely is asking State Auditor Brian Colón, who is a friend of Balderas, to investigate why the attorney general agreed to seal all documents in the case against Vivint Solar Inc. The lawmaker also wants to know why Balderas didn't pursue any specific restitution for thousands of customers as part of the settlement reached last fall. Balderas also is facing a separate ethics complaint in a multibillion-dollar utility merger case that will affect half a million customers in New Mexico.

Hector's explanation for sealing the documents in the solar case is on the linked news story.

And Mariel Nasani of the progressive New Energy Economy comes with this: 

I’m filing an application for a subpoena at the Public Regulation Commission (PRC) to take the deposition of attorney Marcus Rael at the Avangrid/Iberdrola/PNM merger hearing. On the same day you wrote your blog about Rael's dealings in this matter, we updated our complaint to the State Ethics Commission, the Disciplinary Board of NM, and the State Auditor. It discusses that Rael was both the attorney for the AG, the People of the State of New Mexico, and Iberdrola. Whose interest was he representing? Additionally, Marcus Rael was the attorney representing Bernalillo County while Marcus Rael was also representing Iberdrola. Again, was he representing the interests of the people of Bernalillo County or Iberdrola? When you see the terrible merger stipulation you see that the people are getting screwed. 

That's a tricky referral for State Auditor Brian Colón, arguably Balderas' best friend who worked for the Robles, Anaya & Rael firm for 12 years. Ethics experts could have fun with this one. The full complaint against the AG over his contracting with Rael and that is now on Colón's desk is here

Colón's office says they “always contemplate any and all potential conflicts of interest and proceed accordingly and consistently with professional standards” but refused to say whether Colón or an outside auditor would investigate the complaint.

Meanwhile, a California environmental publication--Capital & Main--has dived in to the controversy over Balderas and Rael with the headline:

New Mexico Attorney General Faces Fraud, Corruption Allegations Amid Power Company Merger Civic and environmental groups accuse AG Hector Balderas of improper dealings with a lawyer and longtime friend.   

And a correction on Hector's political history. We blogged that he was "appointed" State Auditor in 2006 by Gov. Richardson. Actually, he was nominated by the state Dems to replace Auditor Jeff Armijo on the November  ballot. Armijo had resigned amid a sex abuse scandal involving two women. Balderas went on to get elected in '06 and re-elected auditor in 2010. We covered all of that ad nauseam back in '06 but what stuck with us this month was that Richardson had cleared the field for Balderas and the Dem Party Central Committee went along. But that was not an "appointment." Here's a bunch of our coverage from back in '06 on the then sensational scandal that brought Balderas to statewide prominence.   

Balderas and Colón once plotted to take over the highest rungs of power in La Politica. Now it's a game of survival for the duo with Colón's hopes of winning the '22 Dem nomination for attorney general hanging by a thread and Balderas hoping to escape more serious damage before his term ends next year. 

Whew! The flash flood warning for La Politica has now expired. Please stay tuned to this station for further developments. 

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