Arizona Senate Appropriations Passes 2010 Budget Sans Tax Increases

by Patrick Gleason, Americans for Tax Reform

Cheerful news to report out of Arizona:

Yesterday the Senate Appropriations Committee passed a budget FY 2010 that closes the state’s $3 billion deficit. Lawmakers closed the gap through privatization, spending cuts, asset sales, bonding, and fund sweeps.

Most importantly, the plan does not include any tax increases.

Arizonans thought they were entering an era of conservative executive leadership when Janet Napolitano left for DC and was replaced by Secretary of State Jan Brewer. However, shortly after taking office, Gov. Brewer proposed an 18%, billion dollar per year sales tax increase in the middle of a recession. It is unclear who is advising her to do this but they apparently never took Economics 101.

In a move that will help expedite the state’s economic recovery, the Senate budget plan also includes permanent repeal of the state property tax. The state property tax had been suspended but is slated to come back at the end of this year. Permanent repeal will provide Arizona residents $250 million in property tax relief this year by preventing its reinstatement. Now that’s stimulus.

Gov. Brewer, who is apparently desperate to lose her first gubernatorial primary, has not only stuck by her calls for a tax increase but has promised to veto any budget sent to her by the legislator that does not sock it to Grand Canyon State taxpayers.

Stay tuned for the latest on this budget fight that is of national importance.


Comments

  1. Patrick, Patrick, Patrick. You put out press releases hoping we’ll all drink your kool-aid and believe you when you say there are no tax increases. Then we’ll all be up in arms when our cities raise taxes and utilities to make up for the money you took from them. But then, the cities will point out that they wouldn’t have had to do this had the legislators not slumped off their responsibility onto the towns and cities.
    You see Patrick, not all of us drink from the same jug. Your press releases aren’t worth the paper they’re written on so please go back and try again.

  2. Patrick Gleason says

    Roger-

    I’m glad you found my post engaging enough to warrant a comment.

    Who would you rather be taxed by – the distant state government – or local officials who are closer to you and more accountable.

    State lawmakers should be commended for not draining more money from taxpayers and the economy during a recession. Families across Arizona are prioritizing to live within reduced means. Do you think the state should just go on spending like we’re still in the boom years.

    Also, you fail to provide evidence for your claim that cities will definitely raise taxes as a result of state lawmakers standing up for taxpayers (if they do, rest assured that we will fight those efforts as well).

    Lastly, this was not a press release, it was a blog post. Sleep easy, no paper or trees were harmed in the process.

    Patrick Gleason
    Americans for Tax Reform

  3. Right on, Roger. The funding sweeps and roll-over of payments are a gimmick and shell game. They just started a fire.

  4. Gimme a tax increase to fund my transportation clients says

    While the methods used to achieve this budget aren’t ideal, they’re still better than a tax increase. It doesn’t matter how much money we have, or how many projects that need funding, liberals will ALWAYS say “we won’t have enough money for THE CHILDREN or some other pet cause without a tax increase.”

    It’s been shown before on this blog that Governor Brewer wants a tax hike in order to provide funding for more transportation infrastructure for her campaign consultant Chuck Coughlin, whose client is Associated General Contractors. This tax hike isn’t even about THE CHILDREN, it’s about payback for Coughlin’s friends. We’ve spent millions on lightrail transportation and where has it gotten us? Oh we’re sorry, we didn’t realize lightrail would cost even MORE. That’s where it’s gotten us. Don’t let Brewer’s tax increase let us fall into THAT well-known trap again.

  5. Most importantly, this plan has nowhere near enough support to pass the full Senate.

    Many of the techniques used are likely unconstitutional and those that are not are likely unwise.

    I also notice nowhere in the post was there mention that the plan relies heavily on federal money.

  6. Patrick Gleason says

    I certainly agree w/ “Gimmee…” that with this budget “the methods used to achieve this budget aren’t ideal.”

    However, it is infinitely better than a tax increase at this time.

    Roger- You sound like one of those guys lobbying for the light rail tax increase so your comments are not surprising.

    ATR commends lawmakers who stand up for taxpayers rather than the spending interests that feed off the taxpayer regardless of economic circumstances.

    Again, Brewer’s proposed tax increase has nothing to do with children, it has everything to do with burning money on the boondoggle that is light rail.

    Patrick Gleason
    Americans for Tax Reform

  7. When the Dems (Janet) were using the K-12 rollover it was shouted down as a gimmick…now we are to believe it is a good thing?

  8. I would note that this Gleason guy is the only one who has the cajones to actually leave his full name and affiliation. If there are any commenters here who are sucking at the government teat, I would urge them to man up and do the same in the interests of full disclosure.

    Something is urging me to create a hashtag, but I’m fighting it. OK, just one:

    #aztaxhikefail

  9. ApplePie says

    I have been a long time fan of ATR! No more taxes!!!! Patrick is right on the nickel with this one “Again, Brewer’s proposed tax increase has nothing to do with children, it has everything to do with burning money on the boondoggle that is light rail.”

  10. Get real says

    How, exactly, is the state paying for light rail? “Mr. Local Government is best” should know that all of the light rail that has been built has been paid for by the cities.

  11. Gimme a tax increase to fund my transportation clients says

    This is to Get real:

    The TIME initiative, which was statewide, would have raised taxes statewide to pay for more light rail. Read about it in the wikipedia entry – http://ballotpedia.org/wiki/index.php/Arizona_Proposition_203_(2008)

    And I agree with Patrick Gleason, if you are one of the special interests like Chuck Coughlin’s firm or government politicians who would benefit from this tax increase, you really should identify yourself if you’re going to comment.

  12. Oberserve says

    I applaud this accomplishment.

    Just one clarification…..

    “Outsourcing” is not “privatization”.

    Privatization means that the government no longer performs, raises taxes for or pays for the function or task being privatized.

    Outsourcing means that the government oversees, raises taxes for and pays for the function or task, but hires an non-government entity to do it.

    No part of the budget contains or pertains to privatization. One could only wish.

  13. Get real says

    “Would have raised taxes?” So, it didn’t pass, right? Wasn’t Napolitano the one behind that? The same Napolitano that advocated for the roll-overs, borrowing, and other budget tricks that you are now all applauding?

  14. Anyone that says Brewers tax proposal is to fund new infrastructure is insane and out of touch.

    Patrick- two ways the cities will have to raise taxes or fees. First, if you raid impact fees cities must replace them to pay for infrastructure, much of which is contractually obligated by development agreements. They would do this by raising utility fees.
    Second, if you withhold licensing revenue, cities must replace this money or cut budgets even further. This revenue goes to general funds which means police and fire. With massive cuts already, there is little doubt cities would raise taxes to “save public safety”.

    I’m sick and tired of legislators running from their rresponsibilities just so they don’t have to make tough decisions.

  15. Light rail? What do this have anything to do with light rail? Your credibility went right out the window with that comment. The tax is to help fill a budget hole of $3B. Where does the state currently spend $1B a year on light rail?

    Patrick, please give me one shred of evidence that the Governors billion dollar statewide tax suggestion has anything to do with funding light rail.

  16. Patrick- A few comments from your first reply. ” Who would you rather be taxed by – the distant state government – or local officials who are closer to you and more accountable.”
    Each should be accountable for their own actions since they provide vastly different services. When the inaction of the state lawmakers causes local officials to have to cut or raise taxes, that to me is the worst dereliction of duty possible.

    “Also, you fail to provide evidence for your claim that cities will definitely raise taxes as a result of state lawmakers standing up for taxpayers (if they do, rest assured that we will fight those efforts as well).”
    I explained very clearly how this will absolutely guaranteed lead to higher utility fees or taxes.

    Dan you are 100% correct. This has nothing to do with light rail and is absurd that anyone would even make the lame attempt to link the two.

  17. Kenny Jacobs says

    Patrick,

    Show me 31/16.

  18. Pricinct Committeeman says

    ATR has become deluded. No tax increase from the Legislature does not mean no tax increase. The plans being used to manipulate the budget will force millions of extra tax bills on local residents. The school proposal alone will cost local taxpayers $300 million to make up what the mini-minds of the Legislature calls “excess funds.” Now, besides school district taxpayers being socked, taxpayers in cities, towns, and counties will pay more to make up for what the Legislature would not do: cut expenses to match funding.

    ATR has lost its way. When local taxes increase, we will all know who missed the ball.

  19. If you’ve been out with Patrick, you know what he drinks (too much of) is a lot stronger than Cool-Aid. He’s an arrogant guy who handles himself without any class. You can tell from his writing style and the disrespect he shows the subjects of his press releases. Still, ATR exists to oppose any and all tax increases at every level, so they’re only doing what they exist to do.

    It does make his discussions of taxation near to us compared to far from us utterly dishonest though. It doesn’t matter to him at what level the taxation will exist. He’ll oppose them all anyway.

    Sadly, it means you can’t really count on ATR for any thoughtful insight into these debates. They’re just a “No!”, period, every time. Really, its not even worth posting the release on it, except he has to look busy to justify his paycheck.

    Is it news if a group called “Yes on every tax!” puts out a release supporting a tax increase? I don’t think so either.

  20. John,

    Nice to know the arguments of tax-hike & spending lobbiests are so weak that all you can do is resort to nonsensical personal attacks.

    There is only one reason Arizona has this budget deficit – chronic overspending. Raising taxes now will do little more than kill jobs and hurt families. The only solution is to truly stimulate the economy and cut the size and burden of government.

  21. Since I have been calling people out to identify themselves, I will do it myself so as to disclose any biases or other facts.

    I am Ryan Ellis, Tax Policy Director at Americans for Tax Reform. I handle all federal tax issues. My friends call me the Tax Playa, but you fools can call me the Gangsta of Love.

    A few points:

    1. It’s quite obvious that several undisclosed parties in this conversation have a vested interest in higher taxes and more government spending. You’re probably lobbyists suckling at the government teat. That’s fine, but at least disclose your blatant conflict of interest.

    2. Unlike the tax and spend crowd in this forum, ATR staff and friends have not resorted to ad hominem personal attacks which are, frankly, ludicrously immature. It betrays a lack of confidence in one’s position, which actually is understandable.

    “John”, I’m looking at you. Who are you, and why do you feel the need to resort to such juvenile tactics?

    3. What people seem to be forgetting here is that the local governments can always either cut spending or dip into rainy day funds. The logic seems to be that they have no choice but to raise taxes. That’s a false choice being peddled by advocates for higher taxes and more government spending.

    4. It’s true–we’re guilty. Americans for Tax Reform opposes any and all tax increases at all levels of government. We make no apologies for this. We used to have erstwhile allies in other right of center organizations in Arizona, including the state Republican party. Unfortunately, that state party has become a house organ for a tax-hiking RINO governor.

  22. Well Mr. Ellis, aren’t you the bigger person? In your own mind maybe!

    I do not agree with Gov. Brewer on everything. Personally, I think the idea to hold a special session where the discussion of tax credits is even a consideration, during a time of such drastic revenue shortfalls is ludicrous. Sweep funds, gimmicky roll-overs, but give a tax credit? I don’t care what/who the subject or recipient is, this is the same as pork to me. A special deal for a special class at the cost of the majority. If the funds are so flush, then give a tax cut to the base rate NOT a special interest.

    But…. DO NOT CALL HER A RINO! That is exactly why we are finding ourselves overwhelmed with Dems…instead of disagreeing and supporting our claims, we call names. Make pejorative comments about those with whom we disagree on 1 or 2 ideas among hundreds.

    You are the worst kind of conservative. You and your arrogant, snarky, holier-than-thou sorts are as destructive to conservative progress as anything.

    Have you ever circulated a petition for a cause other than your own? Have you ever registered a voter? Are you a PC? Or do you sit on the sidelines, feeling so important because you hold a title and have an office in a building somewhere near the Capitol…but in reality you are just another busy little ant among many.

  23. uhh what? says

    Ann,

    You just castigated Ellis for supposedly “name calling” because he referred to the governor as a RINO, which she is. Republicans who advocate tax increases are RINOs. That is not name calling that is just a fact of life

    The ironic thing is that your comment consists of nothing but name calling and ad hominem attacks.

  24. AZ_Conservative says

    I for one am sick of this blog. What a bunch of cry-babies.

    I would really like to see Patrick some to Phoenix and engage in a one-on-one debate with the other commentators who, as “Rellis” has put it will not disclose who they are.

    And Ann – your issue is with the use of “Rhino” and not with the massive tax increases. Wow…at least we know where your priorities are.

    John – for the love of all things holy do not disgrace Kool-Aid by spelling it with a “C”! It is a “K” and always will be. What kind of retard planet breeds all of you people who are supporting tax hikes and spelling Kool-Aid with a “C”!

  25. Ann:

    1. This post is about how Governor Brewer and the AZ state GOP has sold out and advocated tax hikes on AZ families and small businesses. I won’t let you get us off-topic with unfounded ad hominem attacks on me or ATR. Needless to say, my movement credentials are impeccable.

    2. You do bring up an interesting point about making the perfect the enemy of the good. We are not picking a minor issue and accusing the state GOP elite of selling out on it. Rather, we’re taking a core, dogmatic, central tenet of what it is to be a Republican–opposition to higher taxes–and proceeding from that basis.

    You fail to make a distinction between issues of dogma (tax cuts, abortion, guns, etc.), and issues of doctrine (water rights, roads, etc.). If a Republican governor becomes an apostate on a dogmatic issue, excommunication is incumbent until penance is done for the offense.

    Tax hikes are always and everywhere an intrinsic evil.

  26. So Regan was a RINO then? Isn’t he everyone’s hero? But he raised taxes. Cue the head spinning.

    The point Rellis and Patrick is, you put out a release praising a budget the does nothing but indirectly raise taxes? How can you ever justify your arguments?

  27. Get real says

    “Tax hikes are always and everywhere an intrinsic evil.” – rellis

    Gee, that is very helpful to know. I am assuming the “Gangsta of Love” is probably not from here, nor has he had the time to really look at the Arizona budget.

    It is the worst budget deficit in the COUNTRY. And yes, there are places to be cut, and by golly, they should be. But what then? Have you seen the trend lines? Everything is pointed down, wayyy down.

    What happens when a billion more is cut? You don’t think the legislators are going to run for the hills when parents and teachers start freaking out? Its bad enough that Arizona has a bad reputation for education (which I don’t believe), but its worse that kids are now leaving school THINKING that they have received a second class education.

    So what is the solution offered? Have the legislature wash their hands of the problem by pushing it onto the cities. Then, the cities should make even more cuts, because if they propose taxes they are going to be attacked by the same people who bemoaned taxes on the state level. What political courage – let someone else deal with it.

    Also, if you look at the local cities, they don’t have any more money in their raindy day fund and are already having to make dramatic cuts to save their budgets. So, even more cuts, while its an easy talking point to repeat, isn’t going to be as easy in practice.

    Guys, I get your “Taxes = Bad” math, but this isn’t some conspiracy to raise taxes just to line a few pockets. Its a ridiculous notion to put forth in the worst downturn in a generation.

  28. Yes Dan, Pres. Reagan did raise taxes and he grew government and he granted amnesty to illegal aliens and he was cordial to Dems to get the job done. By current standards and quite contrary to my belief…Reagan was a RINO.

    Yes, my comment was aimed at the attitude of the commentator as a rebuttal to the swipe at the Governor. I did not start the fire. Readers know, I am no fan of Pullen or BM, but RINO is not appropriate for Gov. Brewer who has been a champion of conservative governance for decades.

    Once again the single issue voice strikes out at anyone who dares question the validity of an alternate, even if not totally oppositional, opinion that dares question the omniscience of the true believers.

    Taxes are horrible, in my opinion they take money from those who have rightly earned it and turn it over to a state that has not the ability or inclination to adequately serve.

    However, in our society there are things that we give to the state to manage and certain expectations are ours to hold. Taxes are the necessary evil of that agreement. The legitimacy of the need and charge for the service rendered is the measure of value. The patron/voter should hold the state accountable.

    And while we are using the jargon of the day, such singleton attitudes are the enemy of great not pointing out obstacles. Do not look beyond your corner to find that someone may have moved your cheese!

    The world is not flat, sir and sometimes courageous conversations must be had in order to make tough decisions in tough times. All answers are not held in the bubble world of your reality.

  29. January 2008 to January 2009 Arizona saw a net reduction of 166,300 jobs in the state. Meanwhile, government employment in Arizona grew from 433,000 to 437,000 during the same period. So, as Arizona families were losing 166,300 jobs, Arizona bureaucrats added nearly 5,000 to their ranks.

  30. Based on the numbers Patrick just provided, its clear state spending is out of sync with reality. Again – can we all just keep in mind here that Arizonans work 194 days – considerably more than half the year – already, just to pay for the cost of government (http://www.fiscalaccountability.org/index.php?content=cogsub8)
    And you want to add to this burden even more?

    Get real.

  31. Another point I forgot to mention was that the BIGGEST difference between cities and states are the accounting gimmicks being used.

    It’s illegal for cities to do these and should be for the state.

    There are a few different options here.
    1.) Cut to your hearts content and do all the things you railed on Nappy last year. Keep up the infighting and by next year we’ll have a Democrat Governor and Dem controlled house or senate. We’ll be praying for a temporary tax.

    2.) Realize the math literally prevents you from realistically passing a budget without gimmicks, rollovers, or burden on cities (which will cut or tax and blame the Republican Gov and Leg leading to #1). Work together to for once, get true tax reform. Make them put in equal cuts down the road with a mandatory brake in spending and expiration of the tax. Rainy day reform. All of the stuff we never could pass with Nappy at the helm.

  32. For those that think education will suffer if the state doesn’t raise taxes, that just isn’t true. Here is some useful info from the Arizona Department of Education:

    # of students increased from 859,023 in 2004 to 951,117 in 2008 a 10.7% increase.

    # of administrators increased from 2,804 in 2004 to 3,305 in 2008 a 17.9% increase.

    # of teachers increased from 47,396 in 2004 to 53,883 in 2008 a 13.7% increase.

    Avg. teacher salary increased from $42,324 in 2004 to $49,331 in 2008 a 16.5% increase.

    Statewide, Superintendent’s salaries increased from $12,837,427 in 2004 to $19,188,361 in 2008 a 49.5% increase – must be nice.

    Total state aid increased from $3,179,994,562 in 2004 to $4,453,747 in 2008 a 40% increase.

  33. Patrick, you fail to mention that when the private sector added hundred of thousands of jobs in the boom, the public sector was basically flat lined. You also consistently fail to recognize the job loss numbers $1B to $2B in cuts would create.
    Job loss numbers are the weakest argument for no taxes since cuts almost always will produce equal if not higher numbers.

  34. 1. There is nothing necessary or courageous about raising taxes. It’s the act of those who want to profit from Leviathan, either directly (as in the case of some on this blog), or indirectly (most Democrats who want to get campaign checks from the Takings Coalition).

    2. Reagan came up, and that’s a good example of a tax-raising Republican governor. He was converted to a tax cutter in 1980 by Kemp, Laffer, Wanniski, et al. N.B., this was a decade AFTER he was governor, so he repented of his errors.

    3. Failing to raise taxes in a state budget does not ipso facto imply that local taxes must go up. Government at all levels is too big, and you can’t tell me that local governments haven’t jacked up spending in the last decade. If we all have to make do with less and cut back, why the hell not the government?

    4. This is a conservative political blog. I can’t believe there are serious people on here arguing for higher taxes and bigger government. What’s next? Forced abortions at Catholic hospitals? Mandatory gun registration? How many first-tier elements of conservatism will you sell out for your thirty pieces of silver?

    5. Arizona does not have an under-taxing problem. It has an over-spending problem. I have no doubt that Mr. Gleason will be providing some numbers on here documenting the bloated and exponential growth of Arizona state government. Any deficits are the result of too much spending, not that taxes are too low.

    6. All kids who go to public school are trapped in a teacher’s union bureaucracy. That’s why they might receive a second-class education–not because we didn’t throw enough money at the single largest interest group within the Democrat party.

    7. Raising taxes, in fact, would be the cowardly way out of avoiding hard work. The hard-working and responsible legislator takes the time to go line by line through budgets, and conducts oversight of wasteful agencies. The lazy legislator just votes for a tax hike.

    8. Taxes are a necessary evil. But don’t we already have more government than we need? Why do you people want to grow the government by raising taxes?

    Don’t conservatives want to cut government spending? How the heck are you people conservative in any sense of the word?

    9. Raising taxes in the middle of a recession is one of the single dumbest things a state can do. People vote with their feet, and will go elsewhere. Why do you think you’ve gotten all those CA ex-pats over the years?

    10. Conservative is as conservative does. The governor is fighting for higher taxes and more government spending. As Aristotle said in Nichomachean Ethics, “you are what you continually do.”

  35. Dan:

    Can you cite your job numbers since Gleason cited his?

  36. Well, “Dan,” since you haven’t cited your numbers about government jobs in AZ being flat, I went and looked them up myself.

    Put simply, you’re wrong.

    According to the Bureau of Labor Statistics, employment in Arizona fell from 2.635 million in 2006 to 2.616 million in 2008. That is, the state lost 19,000 jobs in that time.

    Naturally, the government must have lost jobs, too, right?

    Wrong.

    Government employment GREW from 409,000 in 2006 to 434,000 in 2008–an increase of 25,000 jobs.

    So while the private sector was shedding 44,000 jobs, the government was adding 25,000 jobs.

    Care to defend that on conservative grounds? Why can’t the government cut back again?

    Our arguments are based on facts and logic. Yours are based on self-interest and emotion. At least disclose who butters your bread.

  37. Pricinct Committeeman says

    I read these messages and cringe.

    Name calling from both sides. Snide, arrogant remarks designed to belittle the thoughts of others. Gee, folks, what ever happened to civility?

    Taxes are bad. A budget that forces taxes downward is bad. An assumption about “rainy day funds” or doing without government services at the lower levels is shocking in light of the admitted failure of the state to cut spending enough to balance the budget.

    Gimmicks, borrowing, and false savings are the things of the previous administration. Our Legislative leaders should be doing better. They are not.

    That’s the shame of this.

  38. Pricinct (sic) Committeeman – Rellis & Patrick are citing facts and figures. The pro-tax groups are resorting to ad hominem attacks. That’s the difference.

    And yes. Taxes are bad. Although you kind of lose me after that…

  39. Go a little further back Rellis. I was referring to the boom times. Try from ’03-06 when we had multi-million dollar surpluses and government spending grew with the support of Republican votes on the budgets.

    The example from before is one perfect example of how municipalities will have NO choice but to raise utility fees. State takes impact fees. City is contractually obligated in development agreement to install infrastructure. Infrastructure is paid back with revenue bonds. Revenue bonds are paid for with utility fees. If the city HAS to put in the infrastructure, please tell me how this does not translate into more costs for me…in essence a tax?

    Tim- these so called fiscal conservatives are thumping their chests for no taxes but all they are doing is borrowing, moving costs into next year, and playing with fuzzy math to get there.

  40. AFTR = Arizonans for Tax Reform

    NOT

    AFTR = Arizonans for Tax Relief

    “Taxes are necessary evil” (only if you think that have law enforcement, roads and other amenities are unnecessary).

    Since AFTR is about ‘reform’ maybe they can suggest which of the following should be cut –

    law enforcement
    roads (including widening freeways which keep going on)
    tax collection
    spring baseball training fields
    nursing home care

    Just wondering….

  41. Wow, I guess you folks had a fun Memorial Day weekend.

    To respond to what’s been said since Friday:

    1. Taxes are bad. Failing to raise taxes at the state level does not, ipso facto, require one to raise them at the local level. The local governments can cut spending. Conservatives believe that government is too big at all levels, including local. Cut spending, don’t raise taxes.

    2. “Dan,” I’m sorry that my research wasn’t comprehensive enough for you. I’d be happy to examine any research you want to provide (which would be a first for this discussion), but I’m not going to do your homework for you. You have yet to explain how the recent growth in government employment is justifiable given the budget situation, or why we should raise taxes to pay these people.

    3. The city can pay for the infrastructure (at least partially) with spending cuts. The rest can use bond financing. Again, tax hikes are the easy way out of this and a substitution for real governing.

    4. Borrowing this year does not mean tax increases next year. It just as easily could mean spending cuts next year. Of course, we’d all prefer spending cuts this year and no borrowing at all, but tax cuts even here are far from inevitable.

    5. “Ron,” you are setting up a false choice. You’re saying it’s either raise taxes, or cut funding for the fluffy bunny petting zoo. This is known as the “Washington Monument strategy,” and seeks to pit popular spending against higher taxes.

    In fact, there is plenty of fat for the government to cut. Arizona government spending has grown between 12 and 15 percent per year since 2005, far outpacing both inflation and population growth.

    Are the tax-hiking, big spending “conservatives” on this board really saying that there isn’t anything they would cut from that before looking to raise taxes?

    Give me a break. Those of us who care about low taxes simply won’t accept your emotional and baseless claims anymore.

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