Full Text of HB4458 97th General Assembly
HB4458 97TH GENERAL ASSEMBLY |
| | 97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012 HB4458 Introduced 1/30/2012, by Rep. Dan Brady SYNOPSIS AS INTRODUCED: |
| 40 ILCS 5/3-110 | from Ch. 108 1/2, par. 3-110 | 40 ILCS 5/3-110.6 | from Ch. 108 1/2, par. 3-110.6 | 40 ILCS 5/15-113 | from Ch. 108 1/2, par. 15-113 | 40 ILCS 5/15-113.12 new | | 40 ILCS 5/15-134.4 | from Ch. 108 1/2, par. 15-134.4 | 30 ILCS 805/8.36 new | |
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Amends the Illinois Pension Code. For a period of 6 months, allows a police officer to transfer up to 10 years of creditable service in either direction between a downstate police pension fund and the State Universities Retirement System. Applies only to service as a police officer. Requires payment by the police officer of the difference between the amount of contributions transferred and the true cost of
allowing the creditable service to be established. Authorizes reinstatement of transferable credits. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately
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| | FISCAL NOTE ACT MAY APPLY | PENSION IMPACT NOTE ACT MAY APPLY | STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT |
| | A BILL FOR |
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| 1 | | AN ACT concerning public employee benefits.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Pension Code is amended by changing | 5 | | Sections 3-110, 3-110.6, 15-113, and 15-134.4 and by adding | 6 | | Section 15-113.12 as follows:
| 7 | | (40 ILCS 5/3-110) (from Ch. 108 1/2, par. 3-110)
| 8 | | Sec. 3-110. Creditable service.
| 9 | | (a) "Creditable service" is the time served by a police | 10 | | officer as a member
of a regularly constituted police force of | 11 | | a municipality. In computing
creditable service furloughs | 12 | | without pay exceeding 30 days shall not be
counted, but all | 13 | | leaves of absence for illness or accident, regardless of
| 14 | | length, and all periods of disability retirement for which a | 15 | | police officer has
received no disability pension payments | 16 | | under this Article shall be counted.
| 17 | | (a-5) Up to 3 years of time during which the police officer | 18 | | receives
a disability pension under Section 3-114.1, 3-114.2, | 19 | | 3-114.3, or 3-114.6
shall be counted as creditable service, | 20 | | provided that
(i) the police officer returns to active service | 21 | | after the disability for a
period at least equal to the period | 22 | | for which credit is to be established and
(ii) the police | 23 | | officer makes contributions to the fund based on the rates
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| 1 | | specified in Section 3-125.1 and the salary upon which the | 2 | | disability pension
is based. These contributions may be paid at | 3 | | any time prior to the
commencement of a retirement pension. The | 4 | | police officer may, but need not,
elect to have the | 5 | | contributions deducted from the disability pension or to
pay | 6 | | them in installments on a schedule approved by the board. If | 7 | | not
deducted from the disability pension, the contributions | 8 | | shall include
interest at the rate of 6% per year, compounded | 9 | | annually, from the date
for which service credit is being | 10 | | established to the date of payment. If
contributions are paid | 11 | | under this subsection (a-5) in excess of those
needed to | 12 | | establish the credit, the excess shall be refunded. This
| 13 | | subsection (a-5) applies to persons receiving a disability | 14 | | pension under
Section 3-114.1, 3-114.2, 3-114.3, or 3-114.6 on | 15 | | the effective date of this
amendatory Act of the 91st General | 16 | | Assembly, as well as persons who begin to
receive such a | 17 | | disability pension after that date.
| 18 | | (b) Creditable service includes all periods of service in | 19 | | the military,
naval or air forces of the United States entered | 20 | | upon while an active police
officer of a municipality, provided | 21 | | that upon applying for a permanent pension,
and in accordance | 22 | | with the rules of the board, the police officer pays into the
| 23 | | fund the amount the officer would have contributed if he or she | 24 | | had been a
regular contributor during such period, to the | 25 | | extent that the municipality
which the police officer served | 26 | | has not made such contributions in the
officer's behalf. The |
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| 1 | | total amount of such creditable service shall not
exceed 5 | 2 | | years, except that any police officer who on July 1, 1973 had | 3 | | more
than 5 years of such creditable service shall receive the | 4 | | total amount thereof.
| 5 | | (b-5) Creditable service includes all periods of service in | 6 | | the military, naval, or air forces of the United States entered | 7 | | upon before beginning service as an active police officer of a | 8 | | municipality, provided that, in accordance with the rules of | 9 | | the board, the police officer pays into the fund the amount the | 10 | | police officer would have contributed if he or she had been a | 11 | | regular contributor during such period, plus an amount | 12 | | determined by the Board to be equal to the municipality's | 13 | | normal cost of the benefit, plus interest at the actuarially | 14 | | assumed rate calculated from the date the employee last became | 15 | | a police officer under this Article. The total amount of such | 16 | | creditable service shall not exceed 2 years. | 17 | | (c) Creditable service also includes service rendered by a | 18 | | police
officer while on leave of absence from a police | 19 | | department to serve as an
executive of an organization whose | 20 | | membership consists of members of a
police department, subject | 21 | | to the following conditions: (i) the police
officer is a | 22 | | participant of a fund established under this Article with at
| 23 | | least 10 years of service as a police officer; (ii) the police | 24 | | officer
received no credit for such service under any other | 25 | | retirement system,
pension fund, or annuity and benefit fund | 26 | | included in this Code; (iii)
pursuant to the rules of the board |
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| 1 | | the police officer pays to the fund the
amount he or she would | 2 | | have contributed had the officer been an active
member of the | 3 | | police department; (iv) the organization pays a
contribution | 4 | | equal to the municipality's normal cost for that
period of | 5 | | service; and (v) for all leaves of absence under this | 6 | | subsection (c), including those beginning before the effective | 7 | | date of this amendatory Act of the 97th General Assembly, the | 8 | | police officer continues to remain in sworn status, subject to | 9 | | the professional standards of the public employer or those | 10 | | terms established in statute.
| 11 | | (d)(1) Creditable service also includes periods of | 12 | | service originally
established in another police pension | 13 | | fund under this Article or in the Fund or System
| 14 | | established under Article 7 or 15 of this Code for which | 15 | | (i) the contributions have
been transferred under Section | 16 | | 3-110.7 , or Section 7-139.9 , or 15-134.4 and (ii) any
| 17 | | additional contribution required under paragraph (2) of | 18 | | this subsection has
been paid in full in accordance with | 19 | | the requirements of this subsection (d).
| 20 | | (2) If the board of the pension fund to which | 21 | | creditable service and
related
contributions are | 22 | | transferred under Section 7-139.9 or 15-134.4 determines | 23 | | that
the amount transferred is less than the true cost to | 24 | | the pension fund of
allowing that creditable service to be | 25 | | established, then in order to establish
that creditable | 26 | | service the police officer must pay to the pension fund, |
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| 1 | | within
the payment period specified in paragraph (3) of | 2 | | this subsection, an additional
contribution equal to the | 3 | | difference, as determined by the board in accordance
with | 4 | | the rules and procedures adopted under paragraph (6) of | 5 | | this subsection. | 6 | | If the board of the pension fund to which creditable | 7 | | service and
related
contributions are transferred under | 8 | | Section 3-110.7 determines that
the amount transferred is | 9 | | less than the true cost to the pension fund of
allowing | 10 | | that creditable service to be established, then the police | 11 | | officer may elect (A) to establish
that creditable service | 12 | | by paying to the pension fund, within
the payment period | 13 | | specified in paragraph (3) of this subsection (d), an | 14 | | additional
contribution equal to the difference, as | 15 | | determined by the board in accordance
with the rules and | 16 | | procedures adopted under paragraph (6) of this subsection | 17 | | (d) or (B) to have his or her creditable service reduced by | 18 | | an amount equal to the difference between the amount | 19 | | transferred under Section 3-110.7 and the true cost to the | 20 | | pension fund of allowing that creditable service to be | 21 | | established, as determined by the board in accordance with | 22 | | the rules and procedures adopted under paragraph (6) of | 23 | | this subsection (d).
| 24 | | (3) Except as provided in paragraph (4), the additional
| 25 | | contribution that is required or elected under paragraph | 26 | | (2) of this subsection (d) must be paid to the board (i) |
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| 1 | | within 5 years from the date of the
transfer of | 2 | | contributions under Section 3-110.7 , or 7-139.9 , or | 3 | | 15-134.4 and (ii) before the
police officer terminates | 4 | | service with the fund. The additional contribution
may be | 5 | | paid in a lump sum or in accordance with a schedule of | 6 | | installment
payments authorized by the board.
| 7 | | (4) If the police officer dies in service before | 8 | | payment in full has been
made and before the expiration of | 9 | | the 5-year payment period, the surviving
spouse of the | 10 | | officer may elect to pay the unpaid amount on the officer's
| 11 | | behalf within 6 months after the date of death, in which | 12 | | case the creditable
service shall be granted as though the | 13 | | deceased police officer had paid the
remaining balance on | 14 | | the day before the date of death.
| 15 | | (5) If the additional contribution that is required or | 16 | | elected under paragraph (2) of this subsection (d) is not | 17 | | paid in full within the
required time, the creditable | 18 | | service shall not be granted and the
police officer (or the | 19 | | officer's surviving spouse or estate) shall be entitled
to | 20 | | receive a refund of (i) any partial payment of the | 21 | | additional contribution
that has been made by the police | 22 | | officer and (ii) those portions of the amounts
transferred | 23 | | under subdivision (a)(1) of Section 3-110.7 or | 24 | | subdivisions (a)(1)
and (a)(3) of Section 7-139.9 or | 25 | | subdivisions (b-5)(1)
and (b-5)(3) of Section 15-134.4 | 26 | | that represent employee contributions paid by the
police |
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| 1 | | officer (but not the accumulated interest on those | 2 | | contributions) and
interest paid by the police officer to | 3 | | the prior pension fund in order to
reinstate service | 4 | | terminated by acceptance of a refund.
| 5 | | At the time of paying a refund under this item (5), the | 6 | | pension fund
shall also repay to the pension fund from | 7 | | which the contributions were
transferred under Section | 8 | | 3-110.7 , or 7-139.9 , or 15-134.4 the amount originally | 9 | | transferred
under subdivision (a)(2) of that Section, plus | 10 | | interest at the rate of 6% per
year, compounded annually, | 11 | | from the date of the original transfer to the date
of | 12 | | repayment. Amounts repaid to the Article 7 fund under this | 13 | | provision shall
be credited to the appropriate | 14 | | municipality.
| 15 | | Transferred credit that is not granted due to failure | 16 | | to pay the additional
contribution within the required time | 17 | | is lost; it may not be transferred to
another pension fund | 18 | | and may not be reinstated in the pension fund from which
it | 19 | | was transferred.
| 20 | | (6) The Public Employee Pension Fund Division of the | 21 | | Department of
Insurance
shall establish by rule the manner | 22 | | of making the calculation required under
paragraph (2) of | 23 | | this subsection, taking into account the appropriate | 24 | | actuarial
assumptions; the police officer's service, age, | 25 | | and salary history; the level
of funding of the pension | 26 | | fund to which the credits are being transferred; and
any |
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| 1 | | other factors that the Division determines to be relevant. | 2 | | The rules may
require that all calculations made under | 3 | | paragraph (2) be reported to the
Division by the board | 4 | | performing the calculation, together with documentation
of | 5 | | the creditable service to be transferred, the amounts of | 6 | | contributions and
interest to be transferred, the manner in | 7 | | which the calculation was performed,
the numbers relied | 8 | | upon in making the calculation, the results of the
| 9 | | calculation, and any other information the Division may | 10 | | deem useful.
| 11 | | (e)(1) Creditable service also includes periods of | 12 | | service originally
established in the Fund
established | 13 | | under Article 7 of this Code for which the contributions | 14 | | have
been transferred under Section 7-139.11.
| 15 | | (2) If the board of the pension fund to which | 16 | | creditable service and
related
contributions are | 17 | | transferred under Section 7-139.11 determines that
the | 18 | | amount transferred is less than the true cost to the | 19 | | pension fund of
allowing that creditable service to be | 20 | | established, then the amount of creditable service the | 21 | | police officer may establish under this subsection (e) | 22 | | shall be reduced by an amount equal to the difference, as | 23 | | determined by the board in accordance
with the rules and | 24 | | procedures adopted under paragraph (3) of this subsection.
| 25 | | (3) The Public Pension Division of the Department of
| 26 | | Financial and Professional Regulation
shall establish by |
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| 1 | | rule the manner of making the calculation required under
| 2 | | paragraph (2) of this subsection, taking into account the | 3 | | appropriate actuarial
assumptions; the police officer's | 4 | | service, age, and salary history; the level
of funding of | 5 | | the pension fund to which the credits are being | 6 | | transferred; and
any other factors that the Division | 7 | | determines to be relevant. The rules may
require that all | 8 | | calculations made under paragraph (2) be reported to the
| 9 | | Division by the board performing the calculation, together | 10 | | with documentation
of the creditable service to be | 11 | | transferred, the amounts of contributions and
interest to | 12 | | be transferred, the manner in which the calculation was | 13 | | performed,
the numbers relied upon in making the | 14 | | calculation, the results of the
calculation, and any other | 15 | | information the Division may deem useful.
| 16 | | (4) Until January 1, 2010, a police officer who | 17 | | transferred service from the Fund established under | 18 | | Article 7 of this Code under the provisions of Public Act | 19 | | 94-356 may establish additional credit, but only for the | 20 | | amount of the service credit reduction in that transfer, as | 21 | | calculated under paragraph (3) of this subsection (e). This | 22 | | credit may be established upon payment by the police | 23 | | officer of an amount to be determined by the board, equal | 24 | | to (1) the amount that would have been contributed as | 25 | | employee and employer contributions had all of the service | 26 | | been as an employee under this Article, plus interest |
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| 1 | | thereon at the rate of 6% per year, compounded annually | 2 | | from the date of service to the date of transfer, less (2) | 3 | | the total amount transferred from the Article 7 Fund, plus | 4 | | (3) interest on the difference at the rate of 6% per year, | 5 | | compounded annually, from the date of the transfer to the | 6 | | date of payment. The additional service credit is allowed | 7 | | under this amendatory Act of the 95th General Assembly | 8 | | notwithstanding the provisions of Article 7 terminating | 9 | | all transferred credits on the date of transfer. | 10 | | (Source: P.A. 96-297, eff. 8-11-09; 96-1260, eff. 7-23-10; | 11 | | 97-651, eff. 1-5-12.)
| 12 | | (40 ILCS 5/3-110.6) (from Ch. 108 1/2, par. 3-110.6)
| 13 | | Sec. 3-110.6. Transfer to Article 14 or 15 System.
| 14 | | (a) Any active member of the State Employees' Retirement | 15 | | System who is
a State policeman, an investigator for the | 16 | | Secretary of State, a conservation police officer, an | 17 | | investigator for the Office of the Attorney General, an | 18 | | investigator for the Department of Revenue, an investigator for | 19 | | the Office of the State's Attorneys Appellate
Prosecutor, or a | 20 | | controlled substance inspector may apply for transfer of
some | 21 | | or all of his or her creditable service accumulated
in any | 22 | | police pension fund under this Article to the State Employees'
| 23 | | Retirement System in accordance with Section 14-110. The | 24 | | creditable
service shall be transferred only upon payment by | 25 | | the police pension fund to
the State Employees' Retirement |
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| 1 | | System of an amount equal to:
| 2 | | (1) the amounts accumulated to the credit of the | 3 | | applicant for the service to be transferred on the books
of | 4 | | the fund on the date of transfer; and
| 5 | | (2) employer contributions in an amount equal to the | 6 | | amount determined
under subparagraph (1); and
| 7 | | (3) any interest paid by the applicant in order to | 8 | | reinstate service to be transferred.
| 9 | | Participation in the police pension fund with respect to the | 10 | | service to be transferred shall terminate on the date
of | 11 | | transfer.
| 12 | | (a-5) No later than 6 months after the effective date of | 13 | | this amendatory Act of the 97th General Assembly, any active | 14 | | member of the State Universities Retirement System who is a | 15 | | police officer under that System may apply for transfer of
up | 16 | | to 10 years of his or her creditable service accumulated in any | 17 | | police pension fund under this Article to the State | 18 | | Universities
Retirement System in accordance with Section | 19 | | 15-113.12. The creditable
service shall be transferred only | 20 | | upon payment by the police pension fund to
the State | 21 | | Universities Retirement System of an amount equal to: | 22 | | (1) the amounts accumulated to the credit of the | 23 | | applicant for the service to be transferred on the books
of | 24 | | the fund on the date of transfer; and | 25 | | (2) employer contributions in an amount equal to the | 26 | | amount determined
under subparagraph (1); and |
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| 1 | | (3) any interest paid by the applicant in order to | 2 | | reinstate service to be transferred. | 3 | | Participation in the police pension fund with respect to the | 4 | | service to be transferred shall terminate on the date
of | 5 | | transfer. | 6 | | (b) Any person applying to transfer service under this | 7 | | Section may reinstate transferable service that was
terminated | 8 | | by receipt of a refund, by paying to the police pension fund | 9 | | the
amount of the refund with interest thereon at the | 10 | | actuarially assumed rate of interest,
compounded annually, | 11 | | from the date of refund to the date of payment.
| 12 | | (Source: P.A. 95-530, eff. 8-28-07; 96-745, eff. 8-25-09.)
| 13 | | (40 ILCS 5/15-113) (from Ch. 108 1/2, par. 15-113)
| 14 | | Sec. 15-113. Service. "Service": The periods defined in | 15 | | Sections
15-113.1 through 15-113.12 15-113.9 .
| 16 | | (Source: P.A. 84-1472.)
| 17 | | (40 ILCS 5/15-113.12 new) | 18 | | Sec. 15-113.12. Transfer of creditable service from | 19 | | Article 3 police pension fund. | 20 | | (a) For a period of 6 months after the effective date of | 21 | | this Section, a participant who is a police officer may | 22 | | transfer to the System up to 10 years of creditable service | 23 | | accumulated under any police pension fund established under | 24 | | Article 3 of this Code upon payment to the System of an amount |
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| 1 | | to be determined by the Board, equal to the difference between | 2 | | the amount transferred to the System under Section 3-110.6 and | 3 | | the true cost to the System of
allowing that creditable service | 4 | | to be established, as determined by the Board. The total amount | 5 | | of creditable service established under this Section by a | 6 | | participant shall not exceed 10 years. | 7 | | (b) Creditable service established under this Section by a | 8 | | participant shall be deemed to be service as a police officer | 9 | | for the purposes of this Article, unless the participant has | 10 | | filed a written notice under Section 15-157 waiving the | 11 | | retirement formula provided by Rule 4 of Section 15-136.
| 12 | | (40 ILCS 5/15-134.4) (from Ch. 108 1/2, par. 15-134.4)
| 13 | | Sec. 15-134.4. Transfer of creditable service as a police | 14 | | officer or criminal justice teacher to the
Article 5 Pension | 15 | | Fund or Article 14 System .
| 16 | | (a) An active member of the Pension Fund established under | 17 | | Article 5 of this
Code may apply, not later than January 1, | 18 | | 1990, to transfer his or her
credits and creditable service
| 19 | | accumulated under this System for service with the City | 20 | | Colleges of Chicago
teaching in the Criminal Justice Program, | 21 | | to the Article 5 Fund. Such
credits and creditable service | 22 | | shall be transferred forthwith. | 23 | | Payment by this
System to the Article 5 Fund shall be made | 24 | | at the same time and shall
consist of: | 25 | | (1) the amounts credited to the applicant for such |
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| 1 | | service
through employee contributions, including | 2 | | interest, as of the date of
transfer; and | 3 | | (2) employer contributions equal in amount to the | 4 | | accumulated
employee contributions as determined in item | 5 | | (1).
| 6 | | Participation in this
System with respect to such credits shall | 7 | | terminate on the date of transfer.
| 8 | | (b) Any active member of the State Employees' Retirement | 9 | | System who is
a State policeman, an investigator for the | 10 | | Secretary of State, or a conservation police officer may apply | 11 | | for transfer of
some or all of his or her creditable service | 12 | | accumulated
in this System for service as a police officer to | 13 | | the State Employees'
Retirement System in accordance with | 14 | | Section 14-110. The creditable service shall be transferred | 15 | | only upon payment
by this System to the State Employees' | 16 | | Retirement System of an amount equal to:
| 17 | | (1) the amounts accumulated to the credit of the | 18 | | applicant for the service to be transferred, including | 19 | | interest, as of the date of transfer; and
| 20 | | (2) employer contributions equal in amount to the | 21 | | accumulated
employee contributions as determined in item | 22 | | (1); and
| 23 | | (3) any interest paid by the applicant to reinstate | 24 | | such service.
| 25 | | Participation in this System as to any credits transferred | 26 | | under this subsection (b)
Section shall terminate on the date |
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| 1 | | of transfer.
| 2 | | (b-5) No later than 6 months after the effective date of | 3 | | this amendatory Act of the 97th General Assembly, any active | 4 | | member of a police pension fund established under Article 3 of | 5 | | this Code may apply for transfer of
up to 10 years of his or her | 6 | | creditable service accumulated
in this System for service as a | 7 | | police officer to that police pension fund in accordance with | 8 | | subsection (d) of Section 3-110. The creditable service shall | 9 | | be transferred only upon payment
by this System to that police | 10 | | pension fund of an amount equal to: | 11 | | (1) the amounts accumulated to the credit of the | 12 | | applicant for the service to be transferred, including | 13 | | interest, as of the date of transfer; and | 14 | | 2) employer contributions equal in amount to the | 15 | | accumulated
employee contributions as determined in item | 16 | | (1); and | 17 | | (3) any interest paid by the applicant to reinstate | 18 | | such service. | 19 | | Participation in this System as to any credits transferred | 20 | | under this
subsection (b-5) shall terminate on the date of | 21 | | transfer. | 22 | | (c) Any person applying to transfer service under | 23 | | subsection (b) or (b-5) may reinstate transferable credits and
| 24 | | creditable service terminated upon receipt of a refund by | 25 | | paying
to the System the amount of the refund plus interest | 26 | | thereon at the
rate of 6% per year from the date of the refund |
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| 1 | | to the date of payment. | 2 | | (Source: P.A. 95-530, eff. 8-28-07.)
| 3 | | Section 90. The State Mandates Act is amended by adding | 4 | | Section 8.36 as follows: | 5 | | (30 ILCS 805/8.36 new) | 6 | | Sec. 8.36. Exempt mandate. Notwithstanding Sections 6 and 8 | 7 | | of this Act, no reimbursement by the State is required for the | 8 | | implementation of any mandate created by this amendatory Act of | 9 | | the 97th General Assembly.
| 10 | | Section 99. Effective date. This Act takes effect upon | 11 | | becoming law.
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