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Auckland Council and the latest rates rise

Written By: - Date published: 1:40 pm, June 28th, 2015 - 69 comments
Categories: auckland supercity, labour, local government, making shit up, national, public transport, same old national, transport - Tags:


The publicity onslaught on Auckland Council this week was somewhat predictable although it could have been handled better.  There were some pretty simple mistakes made.  The spending of $1,296.60 excluding GST on a small celebration after the budget passed was bound to attract attention.  Clearly it did not matter how much or how little the amount was it was always going to be news.  Spending council money on a celebration after rather significant increases had been passed was insensitive and gave the Herald and others the perfect opportunity to attack.  Although I should note that as an employer I regularly put on drinks for my staff and in that regard can see nothing wrong in principle in Council doing the same.

A whole lot of figures have been thrown about concerning the increase and horror stories of $1,000 plus increases in yearly rates have been talked about.  The Herald claimed that tens of thousands of ratepayers would be paying more than a thousand dollars a year in increased rate payments although when it was pointed out to them this figure was wrong they responded by a rather weak retraction.

Herald correction

The basic figure, which no one seems to be talking about, is that there will be a 2.5% increase in the total rate take plus a transport levy on top.  There are winners and losers which mean that for some the increase will be more and for others it will be less.

The increase in Business rates is to be much smaller than the increase in residential rates.  There is a long term policy to reduce business rates.  In July 2013 a business owner paid $2.63 for rateable value compared to $1 for a residential ratepayer.  The plan over 10 years is to reduce this differential to 1.63.  The effect this year will be a 1.4 per cent rates increase for businesses, compared to a 4.2 per cent increase for residential ratepayers.

I have always questioned the rationale for this policy.  Businesses tend to generate considerable use of community resources.  Workers drive to and from their places of work.  Commerce depends on the transportation of goods throughout the region.  And a well designed and functioning city is good for business.  In my view the current level is more than fair.

And besides reducing a business’s rates bill will tend to improve their bottom line and increase their profitability as well as their tax bill.  Conceptually a third of any reduction in rates may be paid to Central Government by way of increased taxes.  Council’s loss is at least in part the Government’s gain.

If it was up to me I would have not reduced the business differential and this would have resulted in residential rates increasing by 2.5%.

Out west local ratepayers also benefit.  From June 1, 2015 the region has finalised a move to rate equally all property of equal value, no matter where it is located.  This benefits out west because on a pro rata basis rates were higher.  But this means that rates in other parts of the city will have to increase to compensate.

The other increase to rates was the transport levy set at a fixed amount of $114 per ratepayer.  Ross Clow opposed the move on the basis that the change was regressive.  Sky City will be paying the same amount as a resident in Piha even though the former’s benefit from an improved transport system is way bigger than the latter’s.

It did not have to be this way.  National has ruled out every attempt Auckland Council has made to establish an alternative funding source.  Auckland’s request for power to impose a regional fuel tax was ruled out as was tolling.  And with Auckland’s commitment to completing the inner city rail link to prevent chaos in 2018 when at current trends Britomart hits peak capacity the Government’s delay in providing support looks like political games being played at the expense of Auckland’s future well being.

One of the government’s preconditions for support, that Auckland city centre employment increases by 25 per cent over current levels, is ridiculous.  If the patronage is increasing then the transport infrastructure needs to be put into place.  It should no matter what particular purpose the infrastructure is being used for.

Generally I support the notion of an increase in rates so that Auckland can fund something that for ideological reasons the Government appears to be incapable of supporting.  And the clock is ticking.  If the inner city rail link is not started now then there will be chaos in Britomart in a few years time.  But this should be paid out of rates and not out of a special levy where the rich and powerful pay the same as the poor.

The politics are fascinating.  The group of councillors who supported the budget were from all parts of the political spectrum.  The Auckland Ratepayers Alliance, a shadowy organisation with links to the Taxpayer’s Union and the National Party have released this graphic.

Auckland Council terrible ten

Of the ten who voted for the budget three have strong National links, list candidate Linda Cooper, former National MP Arthur Anae  and Bill Cashmere, and one, Penny Webster, is a former ACT MP.  Alf Filipaena is the only Labour Councillor to support the budget although progressives Mike Lee and Wayne Walker also voted for it.

Opposing councillors included Labour Councillor Ross Clow and National aligned councillors George Wood, Dick Quax, Sharon Stewart, Cameron Brewer, Christine Fletcher and Denise Crum but also staunch progressive Cathy Casey.  Support for the budget clearly cuts across party lines.  I wonder how the National Party will handle Cooper’s support because as can be seen her vote was crucial.

But to be frank the debate should never have got to this.  The final vote should be pro forma after all the different proposals have been previously debated and voted on.  The repercussions of not passing the budget are very scary.  Are we descending into US Republican type lunacy?

Writing this made me nostalgic for the good old days of Waitakere City where things were simpler, there was more democratic control of the city and we had hopes and aspirations to turning the area into an eco city.  It is time to reconsider super city and consider a more democratic more locally based alternative.

[Edit:  Apologies slightly messy draft published instead of final draft.  Have made some minor corrections to text – MS]

69 comments on “Auckland Council and the latest rates rise ”

  1. ianmac 1

    The original ECan pleaded for the power to carry out progressive actions to develop the Water use policy.
    The Government repeatedly refused to allow any change.
    The Government installed the Commissioners and the first thing they did was enact the power to carry out actions.
    The Auckland City have pleaded for the right to toll and/or petrol Levy but this has been repeatedly refused.
    If this Government gets the change of Mayoralty next year I bet Tolls and Levies will be allowed.
    If the Council wanted to, it could publicise the Government’s obstinacy which would have reduced rates rises. Those complaining about rate rises could direct their venom at the Government. Let Bridges carry the can!

    • Draco T Bastard 1.1

      If the Council wanted to, it could publicise the Government’s obstinacy which would have reduced rates rises.

      That shouldn’t be an if they wanted to bit but an actual legal requirement. Not specifically about obstinacy of course but that every action of a government should be published so that people have the information that they require to make informed decisions.

    • Thomas 1.2

      My rate is creased by 20%. Is there the individual average salary increased by that? Maybe the council officials.

  2. Mike the Savage One 2

    Auckland Council is between a rock and a hard place, one may say, when it comes to funding future transport and infrastructure projects. Central government is reluctant to pay its due share in due time, and simply plays for time. But the rates and extra levy rises now voted for (narrowly) will be hard to digest for many Aucklanders, especially in some areas in South Auckland, where some in Mangere and so will see hefty rises.

    Due to the poor information the media deliver, and due to most continuing to fail to fully understand the need to face the major future challenges for the city and the country now, too many are still only thinking of their immediate, personal costs for their homes, cars and rubbish collections, and lose sight for what is really at stake.

    The central government appears to follow the agenda to further discredit Len Brown and his great ambitions with the City Rail Link and so forth, and hopes for a yet more free market, pro-privatisation mayor, so they can achieve in Auckland, what they wish to continue all over New Zealand.

    More asset sales would be part of the agenda, e.g. selling the Council’s investment in Ports of Auckland, same as Council shares in other enterprises, to finance transport and other projects.

    I doubt whether Len Brown will win another term, and Nat friendly candidates will be groomed already to stand in coming local body elections.

    The effect of the higher than anticipated overall rates and levy increases for ratepayers is one we should all be worried about. Jordan Williams has with others (and the “assistance” of his NZ Taxpayer’s Union) etablished the ‘Ratepayers’ Allance’, which appears to get a fair few members from disgruntled Auckland ratepayers.

    There are vested interests at play, well resourced, and they have the means and agendas to further manipulate and influence the Auckland residents, to believe they have a worthwhile “alternative”. They play on emotions, pick “misspending” items here and there, misinform and provide no feasible, longer term solutions.

    Some think Phil Goff will be a suitable, likely contender for the Mayor role, we know, he was one of the supporters of “Rogernomics”, was he not?

    Where will Aucklanders choose to head in future, I wonder?

    • Draco T Bastard 2.1

      They play on emotions, pick “misspending” items here and there, misinform and provide no feasible, longer term solutions.

      That’s because all the feasible long term solutions require them paying more and for them to stop bludging from the poor.

  3. Sacha 3

    “the transport levy set at a fixed amount of $114 per ratepayer.”

    it’s $99 (plus GST). Unless other figures were expressed including GST this is just more deception smeared around by the opponents.

    • Colonial Rawshark 3.1

      The distinction is worth looking at but still it’s only $99 if you are GST registered and can claim the GST back. For normal people the cost is indeed $114.

    • mickysavage 3.2

      Agreed in that it is effectively $114 for the average ratepayer and $99 for Sky City.u

      • dukeofurl 3.2.1

        Remember too for the general rates category

        “9.7 per cent decrease for farm/lifestyle ratepayers.”

  4. dukeofurl 4

    John Banks supported the Inner city rail loop way back when he was running against Brown for mayor and again when he was running for Epsom with ACT.

    Orsman is running all the Heralds council stories and he has a reputation like Glucina of being untruthful, dishonest and a ratbag , based on the stories he prints.

  5. Colonial Rawshark 5

    If National had any electoral sense, it would come in strongly behind Brown’s City Rail Loop project and just make it happen. Do it now and they will have something to show off during the 2017 GE campaign.

    • Lanthanide 5.1

      Yeah, you’re right.

      They’re usually much savvier at this sort of thing, so there must be a reason. I guess the cost is just too much and they dearly want to cling to their surplus promise?

      Once again, their 2009-2010 tax cuts have fucked their choices.

      • Draco T Bastard 5.1.1

        National are all about private profit and good public transport would cut massively into private profit. It would also be a hell of a lot cheaper than private automobiles and when that strikes home people are going to start to question about all the privatisations.

  6. eszett 6

    Is it just me or is the last part of your last sentence missing?

    [Right you are. Last few words were clipped. Now fixed – MS]

  7. Sanctuary 7

    “…The politics are fascinating…”

    The reaction from Auckland’s wealthy suburbs at actually being made to cough up – especially for PT infrastructure, which is for peasants – has been one of fury.

    I bet you dollars to donuts the Auckland Ratepayers Alliance will run as a ticket next year as a stalking horse for those elites – and if they lose, look for the calls for the council to be deposed in a coup and replaced by commissioners to rise to a crescendo.

    • David 7.1

      “Auckland’s wealthy suburbs at actually being made to cough up – especially for PT infrastructure, which is for peasants ”

      Not really true. Wealthy people are more likely to use the train than ‘peasants’, it’s CBD centric nature makes that a certainty.

    • Draco T Bastard 7.2

      A Developed Country Is One in Which Rich People Use Public Transport

      Interestingly, the issue also sparked commentary on the inherent class divisions in Indian society, where the rich minority seems to possess a sense of entitlement over a majority of the public resources.

      That sense of entitlement is true of all the rich in all societies.

  8. dukeofurl 8

    One of the outcomes is

    “Double deckers enabled on a number of frequent bus routes ”

    Does anyone have more information about this ?

    • Visubversaviper 8.1

      A double decker Richies bus whipped past me on the northern approaches to the harbour bridge on Friday evening.

  9. adam 9

    The super city is a joke.


    A very sick joke.


    one which has seen the end of democracy and vision.


    And a victory for the bat crazy right.


  10. Visubversaviper 10

    Unfortunately the Council’s communications team could not communicate to Polly the Parrot. They seem to think the The Herald is there to print Council’s press releases. It is not – it is there to print Cameron Brewer’s press releases and anything from astoturf ‘ratepayers” groups. They don’t know how to use other media, or even their own staff, and no-one there has a “Fox News Filter” = the ability to look at something and think “how would some lying and morally bankrupt spinner twist this, and how do we best prevent that happening?” They were absolutely blindsided by the Unitary Plan and left the field wide open to pressure groups and NIMBYs. To the detriment of the gowth of Auckland for the next 20 years.

  11. Penny Bright 11

    Where is the ‘cost-effectiveness’ / proven ‘value for money’ of public subsidy of privately owned, operated and managed passenger transport?

    Shouldn’t this have been properly investigated before the imposition of this Auckland ‘transport levy’?

    Got speaking rights at the Auckland Council Governing Body meeting on 25 June 2015 – exposed how there is no such thing as ‘public’ transport in Auckland, and asked why should the public subsidise that which we no longer own, operate or manage?


    (Scroll to 7.30 for the start of my presentation …)

    There are 10 private bus companies, 4 private ferry companies and a French multi-national company operating and managing Auckland trains.

    How much do Auckland citizens and ratepayers subsidise PRIVATELY owned, operated and managed ‘passenger transport’ services?

    If the private sector got to own, operate and manage passenger transport services because they were purportedly ‘more efficient’ – then why do they need public subsidies?

    Where’s the ‘cost-benefit’ analyses that PROVE that public subsidy of private passenger transport services is a more ‘cost-effective’ use of public money than providing PUBLIC transport, under the ‘not for profit’ PUBLIC SERVICE model?

    Why aren’t the Mayor, Councillors and Auckland Council staff asking these questions?

    Why are Auckland citizens and ratepayers being told to pay a $114 per year ‘transport levy’ – when the question of the ‘cost-effectiveness’ of public money being used to subsidise privately owned, operated and managed ‘passenger transport’ apparently has never been asked?

    Auckland Transport are supposed to have this OIA reply by 3 July 2015.

    Penny Bright

  12. Paul Campbell 12

    Here in Dunedin we’ve had rates increase above inflation or over a decade now, including several in the 10% range – people on fixed incomes, especially the elderly with their own homes are stuck paying this.

    Why is it only a big deal when it happens in Auckland?

    • tc 12.1

      Yes infrastructure under investment over many years isn’t confined to jaffaland.

      • adam 12.1.1

        Sure isn’t – but Auckland is the powerhouse of the economy – like it or not. I think most of us jaff’s wish we weren’t.

        I also think like Micky said at the start – much of the ambitions/hopes/desires for Auckland are being crushed under the Super anti-democratic city. I hope this model does not get rolled out across the country – it just means you pay more, for less.

        One positive – corruption appears more obvious in the super city.

        • tc

          Corruption is out in the open under team key and like his idol Muldoon will take many many years to unwind and recover from.

    • Chch_chiquita 12.2

      Same can be said now about Christchurch. We have already had rate increase after the earthquake and now we are facing 33% over the next four years.
      If anyone had a pay increase, these rates increase have not only taken them but also chewed into the already tight budget. I wonder when will the breaking point come.

  13. Penny Bright 13

    Time for a ‘cost-benefit’ of this disastrous forced Auckland a amalgamation?

    This ‘Supercity’ for the 1%?

    At least facts and evidence about Auckland have helped stop the proposed Wellington and Northland ‘Supercities’.

    Penny Bright

  14. James Thrace 14

    Businesses should not have to pay rates. The owner of the building from which the business operator rents, should be the one that faces big rates.

    The building owner will receive such designated “business premises rates”. While they would pass any increase onto their tenant, business operators “should be” savvy enough to negotiate their rental rates. It’s capitalism borne free.

    Right now, the current method of rating businesses that operate from a premise is unsustainable. The owner of the premise should receive the total rates bill for a property, and because it is a commercial property designation, and not residential, rates will be higher.

    Tldr; rates should only ever be levied on land and buildings with owners of such receiving rates bills, not business tenants as a separate council bill. That’s double dipping.

    • Lanthanide 14.1

      How are rates levied on companies? I’m completely unfamiliar with it.

      But the problem of charging rates based purely on physical occupancy, is that companies that have minimal requirements for building space, but generate huge amounts of revenue, would have lower rates builds compared to a similar revenue company that requires much more land/plant to achieve their revenue. That doesn’t seem fair either.

      • RedBaronCV 14.1.1

        The building owner is liable for the rates but most commercial tenancy agreements pass the rates charges onto the tenants who may be companies, sole traders, trusts etc.

        • dukeofurl

          A central city office block used to be rated by ‘annual rental value’ which was connected to a sort of ‘QV rent’.
          Each tenant would receive a rates bill based on floor area rented. The owner was fairly distant in all this unless the rates werent paid.

          When they changed to value of building and land, what each tenant paid wasnt the concern of council.
          Before top floor paid more than say 3rd floor, while ground floor shop would be higher as well.

          Houses were ‘rental value’ as well which wouldnt go up as steeply as land value,
          and pricey properties may 10x a low value house but only 6x rent.

          This land and house value means the wealthy areas are at the sharp end for a change and they are hating it (the rates) but loving it ( total value).

  15. RedBaronCV 15

    We have a government that will do nothing about slowing foreign ownership or immigration into Auckland. They won’t dig in the national pocket for the funds to provide infrastructure for the migrants, they won’t allow Auckland to have tolls or levies specifically for cars.
    Then they expect the ACC to fix all the problems they have caused without rates rises and when the rates go up they try to pin this on poor manangment by the council no doubt with the hope that they get a real right winger in. Then watch government funds flow.

    Well most of the companies that have major contracts with the ACC owned companies (the ones with the expensive managers and directors) return at least 10% on sales so if you want rates to go down 5% stop all the privatisation and reclaim that profit margin.

  16. Ad 16

    Those Aucklanders who own houses through this astonishing property boom, hold your rates bill in one hand, and your Capital Value notice in the other:

    Rates are your tiny little tax on becoming millionaires.

    • Lanthanide 16.1

      Which doesn’t help you if you’re on a fixed income and can’t afford to pay the rates and don’t care that you’re a paper millionaire.

      • Visubversaviper 16.1.1

        It is difficult – I will sell my house when I retire and buy something smaller. The problem is that we have built monomorphic suburbs so if you live in St Heliers or Sandringam your choices of something to replace your big house are quite limited. My parents looked for 2 years for a townhouse to retire to in Mission Bay/Kohi so that they could sell the 4br house we had all moved away from, but stay in the area with their friends and services.
        Unfortunately it was the people in suburbs like St Heliers that bitterly resisted any thought of intensification. They seemed not to care that their kids could not buy in the suburb they grew up in, or that they would not have choices when they came to retire.

        • Ad

          any smaller town appeal?
          take half a mil with you.

          • Sabine

            no services,
            no friends
            no support network when a partner dies away etc.

            people do like to live in their neighbourhoods that they lived most of their lives in. So to go from Auckland to somewhere middle the country where they have to reestablish their lifes might not be what they are after.

            But hey, they have got half a mil on paper so they should just move out of auckland….to somewhere.

            Christ, i find it adorable how so many think that moving out of Auckland is the solution to everything, as long as you have money. Shortsighted selfish little intellectual gimps.

            • Ad

              And we wonder why people complain here about the regions shrinking.

              Plenty of regions that are more attractive to those on fixed incomes. People actually can retire, make clear decisions about new lives, and do move towns.
              It sure ain’t a panacea – but shifting towns to release capital is a perfectly natural and logical response.

              • Colonial Rawshark

                I find it odd that people think of NZ south of the Bombay Hills as some kind of social, amenities and facilities desert.

                Also if you are elderly, in Auckland, and suspect at 5pm on a Friday that you are having a serious cardiovascular incident, how long would it take you to reach the nearest hospital? An hour? I suspect people in Nelson or Napier have it better.

                The thing about downsizing to a smaller town is to do it by 50 or 60, and not in the last few years of life where it is more difficult to rebuild social contacts and get involved with local activities.

                • Ad


                • dukeofurl

                  Its nothing like that. There is an ambulance station around the corner from me, one of about 6 in Auckland.
                  heading into a major hospital on Friday night ( usually less traffic than say Mon Tues) would be around 15 min.
                  A lot of traffic is trying to get on motorways so if you dont do that it moves freely and of course emergency vehicles have priority and travel quickly past bottlenecks.
                  A major arterial is closeby, standstill traffic in one direction only, but ambulances pass along centre fairly easily.

  17. Draco T Bastard 17

    The increase in Business rates is to be much smaller than the increase in residential rates. There is a long term policy to reduce business rates. In July 2013 a business owner paid $2.63 for rateable value compared to $1 for a residential ratepayer.

    For this I’d need to see the figures but I’ve worked in a position before to have a general idea that businesses cost the council far more than a house does. What we’d need to ask is:

    1. How much, in terms of costs, does the business require in services?
    2. Same question for the house.
    3. Which way is the subsidy flowing?

    There is a subsidy, make no mistake about it, and if it follows the same mode as everything else then it’s the businesses that are being subsidised by the residents. That means that the reduction is business rates is ideological and not based in fact.

    If the patronage is increasing then the transport infrastructure needs to be put into place. It should no matter what particular purpose the infrastructure is being used for.

    If there was excellent public transport in the city centre people would be more inclined to move there and this would decrease demand for for more spread on the outskirts of the city. This would drive the amount of capitals gains for Nationals’ land banker mates down and they can’t have that now can they?

    Are we descending into US Republican type lunacy?

    Yes, yes we are as the actions of the NZ version of the US Republican Party usually referred to as the National Party, prove quite conclusively.

  18. Sable 18

    So called super cities juts make it easier for interest groups and shifty politicians to seize control of local government through engineered elections and in so doing control larger groups of ratepayers. I’m deeply opposed to this idea for Wellington and have made submissions to that effect.

    That said, I do think councils in general, like central government, are less and less representative of the public they were, in theory, put in place to serve. They act more like interest groups representing the needs of specific and often small groups, at the expense of the wider community. It is definitely time for urgent reform of all types of government in this country, as it slowly becomes more and more untrustworthy and adversarial.

  19. Ad 19

    Anyone who thinks that raising taxes is a good political idea, think again.

    That “terrible ten” have a real chance of all being town out.

    • Sabine 19.1

      I agree with you. Lets cut taxes, lets stop funding roads, lets stop funding schools, lets stop funding healthcare, lets stop funding public spaces such as parks and libraries, lets stop funding the police, lets stop funding the army, heck lets all set up ourselfs as a Destiny Church and live lavishly from donations of the poor that are tax exempt. Then we are all having a few more dollars in our pockets to buy some shovels and start digging a few dirt tracks.

      again, it seems we are surrounded by selfish, shortsighted intellectual gimps.

      • Ad 19.1.1

        You might want to get to know a few Councillors to understand the volume of stress that they have to operate under.

        In terms of intellectual analysis, Auckland Council’s LTP was subject to extreme scrutiny, including:
        – the largest public consultation in local government history
        – Office of Auditor General scrutiny
        – scrutiny from the Prime Minister and all relevant departments, amplified at high volume through the media
        – Independent 5,000 person polling
        etc etc

        Lefties need to understand that taxing is politically costly.

        • Sabine

          and rightwingers need to know that without taxes nothing gets done because at the end of the day no – one wants to spend money.

          go have a look at certain US States, Kansas, Wisconsin, Florida, Texas etc all come to mind.

          How long do you think that infrastructure is gonna last if one does not spend a bit of money every now and then.

          but I can see where you come from, you would have no issues with taxes being raised, as long as it is not your taxes.
          You should joint the National Party and stand for office….you don’t have to do anything, get to sell what does not belong to you, cut the tax rate on your earnings, and when it does not work, cry that its all Aunty Helens fault.

          Poor poor thing. Work, its hard, n dusty, n unpleasant.

          • Ad

            Nope. Very pleased to pay taxes, and happy to pay more under an alternative government, within reason.
            Just a reminder: In the last election Labour stood on a comprehensive raise-taxes policy platform, and was creamed. I mean worst in multiple generations creamed.

            Lefties that do not understand the political cost of raising taxes are not going to be in power to change the city/country/world.

            • Tracey

              they need to be like righties, lie about intending to do it, do it and then lie and obsficate about whether it is a tax, oh and blame Labour, right Ad?

    • her 19.2

      Add Penny Hulse and John Walker to the terrible twelve for doing nothing.

  20. northshoreguynz 20

    I went onto the Auckland Ratepayers Alliance Facebook page. Made some mildly anti remarks, and got some ferocious type replies. Very WO.

  21. Old Mickey 21

    “I regularly put on drinks for my staff and in that regard can see nothing wrong in principle in Council doing the same.” –

    What was missing was a little bit of sensitivity about the timing. Even if the increase was only 2.5%, this does not look good when spending public money.

    • Clean_power 21.1

      Sensitivy is an unknown word to mr Brown, who has the hide of a rhino and the fine taste of a Chardonnay socialist.

      • Sabine 21.1.1

        same as all the other Torys? Nope?

        and yes, bosses do put out drinks for staff.

        • dukeofurl

          And the US Embassy provides the drinks for the year end bash in parliament !

          Go figure ?

  22. Save NZ 22

    While I agree many of the problems are caused by the SuperCity, Len Brown has not helped himself by his Sky City freebies and worse, backing with rate payers money, the Ports of Auckland and voting to cut down the Kauri trees.

    Out of touch with public opinion and allowing extreme rot within his own council officers (with the CEO).

    As usual Auckland’s are between a rock and a hard place, as there is very little alternative to vote for.

  23. Tracey 23

    Corrections ought to have to headline on the front page…

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