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"I'm not going to let the people of Cleveland get swindled."
"there may be some people who may be going to jail."
White said Jacobs ... snookered the public.
``Jacobs should pay for roads if Highlands goes retail,''
"take a good look at Jacobs' South Park mall"
Dirty Details of Chagrin Highlands Development Deal



``Jacobs seeks city OK to build large stores

Developer Richard E. Jacobs wants the city of Cleveland to let him build big stores at Chagrin Highlands ...

At Jacobs request, City Council last night [1-29-01] introduced legislation that would allow four stores on 46 acres in Warrensville Heights ...

Former Warrensville Heights Council President Donald Bolden said yesterday that he had not been told of plans beyond three restaurants the city approved last month. Nate Harris, the city's building official, said Jacobs has filed no plans with the city ...

But both Mayor Marcia Fudge and Bolden said last month that they wanted the remaining 40 acres to be used for offices and hotels, which would bring in more income taxes than restaurants and stores ...

Fudge said Jacobs officials had PROMISED not to use the property for retail. ''

Plain Dealer reporter Patrick O'Donnell contributed to this article.




"White says retail is wrong for Chagrin Highlands

Cleveland City Council President Mike Polensek's proposal to allow huge stores in the Chagrin Highlands office campus "would do more damage to the city of Cleveland and Northeast Ohio than any ordinance in recent memory," according to Cleveland Mayor Michael R. White.

Chagrin Highlands, in the city's eastern suburbs, offers the best chance for attracting high-tech and biotechnology and other firms to Northeast Ohio, administration officials said yesterday. To allow even one section of the forested 630-acre tract to become a retail center would undermine 12 years of planning and discourage international companies from moving in, they said.

White and his staff took an unprecedented step this week and wrote Polensek detailed arguments for why the legislation should die.

"I have always compared this project to the Hope Diamond," Ken Silliman, an executive assistant to White, said in his letter. "Both assets could yield significant profits to their owners if they were carved into smaller, more conventional marketable pieces. But the assets in their present form, if preserved and polished to perfection, have value that sets them apart from other worldly objects."

Cleveland has owned Chagrin Highlands, which is in Beachwood, Highland Hills, Orange and Warrensville Heights, for a century.

Since 1988 ... the city has planned the site as a research park where international companies could put their headquarters. The vision is based on Research Triangle Park in North Carolina.

City officials were so persuasive in explaining their vision in 1988 that state officials spent tens of millions of dollars upgrading highways to handle Chagrin Highlands traffic.

[Express lanes were added to Interstate 271, and a Chagrin Highlands INTERCHANGE opened last year (2000). First the INTERCHANGE, then the MEGAMALL.]

Suburban mayors long have applauded the plan because they would get half the income taxes generated by Chagrin Highlands. Office buildings generate four times as much in income taxes as stores, based on square feet of floor space, said Economic Development Director Chris Warren.

The city's original development contract for Chagrin Highlands was with Figgie International Inc. City officials were so happy to bring the Fortune 500 company to Cleveland in the late 1980s that Figgie's development contract had few limitations, Silliman said.

In the 1990s, however, city officials learned that the Richard E. Jacobs Group was Figgie's secret partner in Chagrin Highlands. Because Jacobs business is shopping malls, city officials feared Chagrin Highlands might become a sprawling mall project.

The city sued to preserve its plan for a research park and office campus, and in 1996, a settlement set rigid caps limiting stores, hotels and warehouses.

In January Polensek introduced legislation to remove all the caps ..."


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FEATURE ARTICLE from THE FREE TIMES, 3-8-01, by David Morton and Josh Greene

Late last Friday afternoon, an unsolicited delivery from Mayor Michael White arrived at the offices of the Free Times. For our weekend reading pleasure, two city employees wheeled in 35 boxes totaling tens of thousands of pages of documents ...

The contents of the boxes are the "Figgie file," as in Figgie International vs. the City of Cleveland, a court case that had been settled four years ago [1997] after more than two years of litigation and $1 million in city legal efforts.

In dispute was Chagrin Highlands, a massive open tract of valuable city-owned land within four eastern suburbs, Beachwood, Orange, Highland Hills and Warrensville Heights ...

This glossy economic generator would bring tens of thousands of high-paying jobs to a stagnant region, to say nothing of the increased income tax revenues the city would accrue. Some real estate experts had consider it the most valuable piece of unspoiled land between New York and Chicago.

Fortunately for the city, the lawsuit settlement four years ago ensured that developer Dick Jacobs - whose involvement as a silent partner only became known later - couldn't reduce this exalted vision to a supermall.

It was a big win for the city. Not only had Jacobs clandestinely gotten his fingers in the Highlands pie, but once his involvement became known, it was also revealed that he wanted to build a 900,000-square-foot retail mall, not only potentially damaging retailers for miles around, but threatening to quash the best chance Cleveland had for attracting well-paid high-tech jobs to the area.

So why was a forest of documents being delivered to us now, four years later' Because, says the mayor's office, Council President Mike Polensek has introduced legislation to scuttle the city's hard-earned agreement and give Jacobs, one of council's political benefactors, carte blanche to develop the plum Highlands property any way he sees fit, including big-box retail stores ...

In February [2001], Polensek and 11 other council members met in private with Jacobs and Forbes about the property (Jacobs Group called them "informal discussions"). It was reported that council was considering lifting some of the settlement's retail restrictions so Jacobs Group could build big-box stores in the Warrensville Heights portion of the Highlands. But as it turns out, that's just the tip of the iceberg.

The Plain Dealer reported the Highlands matter as if only 46 of the 640 acres were in question. This is not the case. Polensek's legislation actually proposes unilaterally lifting all the important restrictions on the entire property.

The consequences are enormous. If this bill survives a White veto (council needs 14 votes to override him), and Jacobs can succeed in muscling the suburban governments that share the property with Cleveland, look for large-scale retail development of the kind few people want and nobody needs.

Existing retail, especially on the East Side, would inevitably suffer. The two-decades-long dream of a high-tech corridor in Greater Cleveland - the engine for growth that has eluded the area - could be dead. More than $100 million already invested by the state and local governments to support that development at Chagrin Highlands would be for naught ...

It's called Chagrin Highlands because of its altitude. You can see downtown from there. For decades, city planners have dreamed up uses for the 640 acres comprised mostly of wooded land ...

The director of Case Western's Center for Regional Economic Issues, Richard Shatten, says such dreams are a lot like gambling. Jobs are tough to create, but there are ways to increase the odds.

Because of its size, its proximity to the freeway and to major educational institutions and residential neighborhoods (and because it's 20 minutes from downtown), Cleveland's high-wager bet on the Highlands was "absolutely spot-on," he says.

So Cleveland packaged the parcels together. Now all they needed was a Fortune 500 company to come in, take the lead and start developing. Then-Governor Dick Celeste suggested Cleveland meet with Figgie International, a prodigal corporation looking to return.

Figgie and Cleveland hit it off like new lovers - and at first it was a match made in heaven. Figgie had built a similar, smaller corporate park in Virginia and was ready to commit to the real deal.

The company proposed 3.2 million square feet of "Class A" office space, 30 percent wooded and manicured open space, and most important, 14,572 highly paid permanent employees making, on average, $50,000 a year. The 23-year build-out predictions estimated $852 million in annual payroll and a "minimum" of $8.5 million in payroll taxes.

City Council, and the affected suburban communities, approved this marriage in 1989 (the city and suburbs would share income tax receipts from all new development 50/50). What they didn't know was that mall developer Dick Jacobs was Figgie's silent partner in the deal.

... the fact that Jacobs was in on the Figgie deal wasn't public. Internal memos turned up through the court battle show he was there from the get-go.

So now it's like the city married the beauty queen, but with her comes the evil twin. And then Figgie passes away -- total internal restructuring -- and the city is stuck with Dick Jacobs.

When the city finds out it's married to Dick, it tries to get an annulment. Figgie and Dick sue. The city, the county and the state all agree that the corporate park is a priority -- and if it will help attract the 14,572 workers, it is money well spent.

But when Jacobs is discovered to be behind the scenes pushing for a mall, the deal is off. A $150 million expansion to I-271 is halted. So Jacobs capitulates. He agrees: no "big-box" retail, no 900,000-square-foot mall, just stick to the original dream -- a high-tech corporate park.

Even City Council agreed, approving the settlement unanimously in 1997.

A few years later, in 2000, the INTERCHANGE IS COMPLETE. And just a few months after that, Jacobs asks council to forget the 1997 settlement ever happened. City officials don't think that's a coincidence.

"Here's what I think is the bottom-line issue," said Mayor White in a hastily arranged meeting in his office on Monday [3-4-01]. "Here's a company that was secretly put into a deal in the back room, who has from the very beginning tried to denigrate this deal to get another mall deal." ...

"If this council will vote to support this ordinance, they would be supporting denigrating one of the most important economic visions in the history of this region."

What does the Jacobs Group want to disappear? The caps on retail use, on hotel construction and on warehouses, the 30 percent open-space requirement - and all restrictions regarding "big-box retail" and the "vision statement."

What are the consequences? A recent regional retail study conducted by the Cuyahoga County Planning Commission warns that the area is already saturated with retail. More retail means musical chairs, with retail jobs simply shifting from one part of the county to another.

Other foreseeable negatives: more retail means more asphalt means more runoff. More retail also means more traffic. But above all, the more retail, the less attractive the site becomes for the high-class office space it's supposed to be about ...

"The office component, which remains the vision for Chagrin Highlands, has been proceeding somewhat slowly," says Tom Henneberry, executive VP of Jacobs Group, "and there are retail opportunities ..."

Mayor White responds that if the Jacobs Group doesn't feel it can uphold its end of the bargain, it should give up its lease and let Cleveland find another developer ...

[Councilman Bill Patmon, chairman of the council Finance Committee, argues] lifting the restrictions is about letting Warrensville make its own decisions, instead of having land use dictated to them by Cleveland City Hall ...

So, did Warrensville request that Cleveland City Council release it from its shackles? ...

Warrensville Heights Mayor Marcia Fudge, along with other suburban mayors, in fact, strongly objects to lifting the restrictions, for fear they'll get stuck with retail.

Without the backing of Cleveland's umbrella agreement, which the White administration regards as a "firewall" against outside pressures, local zoning laws become much more vulnerable.

Beachwood has in place office-only restrictions for their part of Chagrin Highlands. Warrensville has a mixed-use zoning, which would currently allow big-box retail. Using the same magic spell they've cast on Council President Polensek, the Jacobs Group could potentially alter Beachwood's law and prevent a change in Warrensville's.

Patmon argues that the suburban leaders are more than capable of doing what they want to do. Others are not so optimistic.

"I imagine that there's going to be some tremendous pressure on those places to change," says Tom Bier, a professor at Cleveland State's Maxine Goodman Levin College of Urban Affairs, who specializes in development issues. "They could be sued if they don't change. Do they want to battle it out in court, even though they might win' They're up against some pretty, pretty powerful stuff. So, good luck."

Why has council put itself in this position? For Jacobs, amending the agreement is good business; he could realize profits a lot faster through retail development than high-tech office space ...

White's response is that not only is it bad for the city, but "whether Dick Jacobs has it, whether Sam Miller has it, whether Santa Claus has it, we want something very simple -- you signed a deal, a deal is a deal, stick to the deal.

"Write this down," says the mayor. "I'm not going to let the people of Cleveland get swindled." ''

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FEATURE ARTICLE from THE FREE TIMES, 3-8-01, by Roldo Bartimole

"... should Dick Jacobs be allowed to develop big box retail stores in parts of the Chagrin Highlands development? ...

[Polensek arranged] private meetings between Council members and Jacobs on the developer's desire to dodge a legal deal he made with White.

The legal settlement restricted the type of development Jacobs could pursue at Chagrin Highlands, favoring offices over retail. This insures better paying jobs at the 600-acre development on city-owned land in eastern suburbs where the city shares up to 50 percent of suburban income taxes.

Worse, former Council President George Forbes attended the meeting with Jacobs. In 1989 Forbes helped Jacobs secretly become the prime developer. Polensek had fewer than 11 members attend to skirt public meeting laws, also a reminder of Forbes' anti-press activities ...

Polensek's moves didn't go over well with White, who once called Jacobs' involvement in this project "a dirty little deal done in the backroom." He also warned that "By the time this {legal battle} is over ' there may be some people who may be going to jail." Jacobs sued the city for $100 million for allegedly breaking its contract with him on this development ...

Forbes got Jacobs into the Chagrin Highlands deal, once a venture of the Figgie Corp, now STI Properties. In a deposition, Forbes - whose firm went to work for Jacobs after he left office - acknowledged that Jacobs wanted the land as long ago as 1986. Jacobs' name wasn't mentioned when Council ratified the historic deal in 1989.

When the press conference to announce the Chagrin Highland's deal was held, Jacobs was nowhere around. Forbes testified in a deposition, "Because Harry Figgie did not want them {Jacobs' executives} invited."

However, Jacobs' involvement was kept secret because at the time he was asking for unprecedented tax abatements from the city. It would have been embarrassing and controversial to find he was also getting access to this desirable city land, some of the most valuable developable land between New York City and Chicago.

Now, Polensek by taking up Jacobs' cause with Forbes still at the developer's elbow puts himself in political jeopardy. This associates Polensek too closely to Forbes.

Jacobs, after all he's gotten from the city - hundreds of millions of dollars in tax abatements and loans, the ability to speculate with city properties for 10 years at 12th and St. Clair, and the hundreds of millions for Jacobs Field - deserves no special consideration.

Further, taxpayers have invested some $150 million in highway and road improvements to accommodate the Chagrin Highlands development. [THE INTERCHANGE]

Jacobs should not be allowed now to utilize that land for easy but unnecessary retail development, especially since he and the city ended their legal battle with Jacobs giving up that right ...

In 1988 Carl Stokes wrote that the Figgie project was bad for Cleveland. He concluded, "We will see more of the same kind of humdrum development that competes with Cleveland's downtown everywhere in our region."

That's just what Jacobs wants from Council now. And the question is what does Polensek want Jacobs to do for Council in this election year? "

e-mail Roldo Bartimole at

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``Angry White calls Highlands a swindle

For seven years the businessmen behind the Chagrin Highlands development publicly promised to build a ritzy campus for corporate headquarters in the woods of Cleveland s eastern suburbs.

Privately, internal memos show, they spent those seven years planning to include a mall bigger than Beachwood Place.

"The Chagrin Highlands project has been one of the greatest swindles in Cleveland's history," Mayor Michael R. White said last week.

While keeping the mall plans secret, the businessmen publicly peddled their idea for an office park to get taxpayers to prepare the land for development.

It worked.

Enamored of the prospect of Fortune 500 companies settling in Cuyahoga County, two governors ponied up more than $100 million in tax dollars to add express lanes to Interstate 271 and to build a Chagrin Highlands interchange at Harvard Rd.

What the government officials didn't know was that developers Richard E. Jacobs and Harry E. Figgie Jr. also wanted that interchange for the mall they planned on part of Chagrin Highlands.

"The timetable we suggested for the regional mall always has been closely related to the construction of the Harvard/I-271 interchange," Jacobs wrote to Figgie in August 1991.

White's top staff members, City Councilman Jay Westbrook and other leaders say they never would have approved a huge public investment in Chagrin Highlands if they had known about the mall plans. White said Jacobs and Figgie snookered the public.

"They attempted through deception and other forms of trickery to destroy the very principles upon which the Chagrin Highlands development deal was created," he said.

Twelve years after Jacobs began planning the mall - and eight months after the interchange finally opened - Jacobs still wants shoppers in Chagrin Highlands. Only now he wants "big-box" stores instead of a mall ...

Cleveland bought the land, which stretches along Harvard Rd. from Green Rd. to just east of the interstate, in 1902 for a jail and work farm. The tract remained mostly vacant until 1988, when the city offered development rights to Figgie International, a Fortune 500 company that had abandoned Cleveland for Virginia a few years earlier.

Figgie accepted the lucrative deal and promised to build its world headquarters as the centerpiece of the campus. To design a "world-class" office park, Figgie hired Wallace, Roberts & Todd, the firm that designed Baltimore's acclaimed Inner Harbor.

Wallace, Roberts & Todd envisioned Chagrin Highlands as rolling, wooded hills with more than 3 million square feet of office space in stately buildings. The plan included a few hotels and 80,000 square feet of specialty stores.

Figgie took the Wallace, Roberts & Todd plan to dozens of state, county and local government officials to win approvals and public spending. The interstate express lanes and Chagrin Highlands interchange were designed to handle traffic based on office buildings in the Wallace, Roberts & Todd plan.

From the start, however, Figgie, along with his secret partner, Jacobs, had plans to build a 900,000-square-foot shopping mall on the highlands, according to company correspondence obtained by the city of Cleveland. The city obtained the records through a lawsuit about Chagrin Highlands development rights ...

Jacobs began pushing for big-box stores in Chagrin Highlands two years ago. The plan became public in January [2001], and it quickly brought a storm of protest from suburban leaders and White.

The main reason for the opposition is that store clerks pay less income tax than corporate executives. White has argued that Cleveland will lose millions of dollars if low-paying jobs are permitted in Chagrin Highlands.

For the moment, no big stores can be built at the site. Jacobs and Cleveland settled their lawsuit in 1996 with a contract that set strict limits on stores and hotels. City Council unanimously approved the limits, which White demanded after learning in 1995 that Jacobs long had planned a megamall.

"I've never quite gotten over this," Ken Silliman, an executive assistant to White, said of the revelation about the mall plans.

Jacobs wants Cleveland City Council to erase the limits, and his newly stated goal is to put three big stores on 46 acres in Warrensville Heights. The first store would be The Great Indoors, an interior decorating showroom run by Sears.

Championing Jacobs' proposal is City Council President Mike Polensek, who argues that the development decisions should be left to the suburbs. If the suburbs want stores in Chagrin Highlands, they should have them, according to Polensek.

If the suburbs had had that kind of control five years ago, Beachwood would have built a garbage-recycling plant in Chagrin Highlands, records show ...

The White administration contends that Jacobs' latest plan proves he never intended to honor his commitment to build ritzy offices.

"Converting our original campus-style office park vision into big-box retail or a regional mall may mean short-term profit for Jacobs Group, but over the long haul increases the glut of retail," the administration said in a written statement ...

Jacobs said developing the office park would take many years, while he can attract stores right away.

Jacobs also said he did tell some public officials of his mall plans, but he said they were pretending he did not. Among those he said he told was Westbrook.

Not so, said Westbrook.

"I would have raised holy hell," he said.

Westbrook is one of many opponents lining up against Jacobs as the retail proposal nears a council hearing, probably next month.

Jacobs is undeterred.

"I don't give up that easily," he said.

Countered White:

"If it passes, I will veto it. If council overrides my veto, I will bring a citizens' suit ... so fast it will make their heads spin." ''




``A century ago, Cleveland's newly elected Mayor Tom L. Johnson acquired 1,200 acres in what were then the wilds of southeastern Cuyahoga County. Like many in his day, he saw "the country" as a redemptive place where the problems of urban life could be cured.

Over the years, Cleveland would build a workhouse for convicts on the land, as well as a sanitarium for patients infected with tuberculosis.

But most of the land remained vacant even as surrounding fields erupted into suburbia. Then, in the early 1980s, ... Mayor George V. Voinovich asked city planners what could be done with the remaining 630 acres.

Led by Hunter Morrison, then and now the city's planning director, they proposed a campus of grand corporate headquarters and office complexes, high-end hotels, restaurants and specialty stores.

In 1987, Voinovich cut a deal with industrialist Harry Figgie ...

Fourteen years later, that dream remains unfulfilled. One office building is up, and land is being cleared for a second ...

Now, at Jacobs urging, Cleveland City Council may amend a 1997 agreement between developers and the city.

... as introduced by Council President Michael Polensek, the ordinance would gut the accord that belatedly set a master plan for Chagrin Highlands. Caps on retail throughout the development would be scuttled. So would requirements for the green space and amenities designed to make Chagrin Highlands "world-class."

That would be a very bad idea.

Jacobs argues that despite dogged work by his firm, few of the major corporate tenants envisioned by Morrison's planners are interested in Chagrin Highlands ...

Jacobs argues that loosening the master plan would not lead to willy-nilly development because of local zoning rules. But one reason for binding all parties was so that no town could cut its own deal and undermine the overall effort. That principle should still hold.

Keep in mind that Ohio taxpayers paid $150 million for the Interstate 271 interchange at Harvard Rd. that opened last summer. Regional planners approved it to serve a corporate campus, not a shopping center... ''

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``Jacobs should pay for roads if Highlands goes retail, Trakas says

State Rep. James Trakas wants developer Richard E. Jacobs to pay $155 million if Jacobs adds more stores to plans for the Chagrin Highlands office park in Cleveland's eastern suburbs.

Yesterday, Trakas said the payment would reimburse the state for Interstate 271 express lanes and a Harvard Rd. interchange that were built based on past assurances that the 630-acre site would attract corporate headquarters and high-paying jobs.

"I think the taxpayers were misled and deserve to be reimbursed," he said at a City Hall news conference. The Independence Republican said he would introduce state legislation requiring Jacobs to repay the $155 million over 20 years if plans for the park are changed.

Officials for the Westlake-based Jacobs Group declined to comment. The Jacobs Group is the lead partner developing the site, which sits in Beachwood, Highland Hills, Orange and Warrensville Heights.

Cleveland Mayor Michael R. White joined Trakas to speak against a proposed ordinance that would lift restrictions on retail development at the city-owned park.

Cleveland City Council President Mike Polensek, who sponsored the ordinance, said protests by White and Trakas will not deter council ...

Trakas contends that Cleveland and the suburbs, which will share in income taxes from the development, are better off waiting for the developer to bring in high-paying corporate jobs.

He called efforts to open the site to more stores a "cheap attempt to get quick dollars." ''


Wednesday, March 21, 2001


``More mayors to fight Jacobs retail plan

WARRENSVILLE HEIGHTS - Four more suburban mayors vowed yesterday to fight developer Richard E. Jacobs plan for retail development in the Chagrin Highlands office park.

Mayors of Beachwood, Orange, Shaker Heights and Cleveland Heights joined the mayors of Highland Hills, North Randall and Warrensville Heights in opposing "big box" stores at Harvard Rd. and Interstate 271.

At a press conference on the site, six of the seven mayors said taxpayers have invested money in the Chagrin Highlands project with the idea that it would lead to a first-class office park. The state gave $155 million to build an I-271 interchange at Harvard Rd.

That type of development would galvanize the region and create a stable revenue stream for Greater Cleveland, the mayors said.

"All of our communities are competing in a global marketplace," said Shaker Heights Mayor Judy Rawson, a Cuyahoga County Planning Commission member. "This general site is the last, best chance to position Northeast Ohio in this arena." ...

Warrensville Heights Mayor Marcia L. Fudge said a Jacobs Group official told her that corporate businesses do not want a Warrensville Heights address, but "big box" retail stores have no problem locating in the city.

"This recent ploy results in insidious economic redlining," Fudge said ...''


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``I am writing in response to Councilman Bill Patmon's comments on the Chagrin Highlands project ("Battle for the Highlands," March 7 [2001]).

There are enormous environmental, social and economic costs attached to the Chagrin Highlands project.

Chagrin Highlands is really a misnomer for the 630 acres leased by the City of Cleveland to the Jacobs Group. The area should be truthfully called "Mill Creek Headwaters." Visualize wildlife, wetlands and land area the size of a Metroparks reservation and you get an idea of the possible impact.

This project affects thousands of homeowners and local retailers. The traffic issues have been studied by NOACA [Northeast Ohio Areawide Coordinating Agency] for over 10 years.

In 1996, Chris Warren from the city's economic development department met with local representatives from the Sierra Club to listen to concerns over the proposed I-271 interchange.

Ironically, the main objective was to protect Camp Forbes, the only outdoor recreational camp experience available to many city kids. Camp Forbes is adjacent to the project.

The taxpayers of Ohio footed half of the bill to construct the I-271 interchange at Harvard and Richmond roads under the condition that "big box" retail and its subsequent parking and traffic impact would be prohibited.

Now Jacobs is making yet another questionable deal with some members of Cleveland City Council. To Councilman Bill Patmon -- who claims this isn't about issues, but about "friends and enemies" -- I say, take a good look at Jacobs' South Park mall.''

Laura McShane, Cleveland

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