07-22-2019 Minutes CITY OF SALINA, KANSAS
REGULAR MEETING OF THE BOARD OF COMMISSIONERS
July 22,2019
4:00 p.m.
The City Commission convened at 2:30 p.m. for Parks Master Plan Prioritization List & Animal
Shelter Grant Funds Report and at 3:45 p.m. for Citizens Forum at City-County Building, Room
H 107.
aThe Regular Meeting of the Board of Commissioners was called to order at 4:00 p.m. in Room 107,
City-County Building. Roll call was taken followed by the Pledge of Allegiance and a moment of
silence.
Those present and comprising a quorum: Mayor Trent W. Davis, M.D. (presiding), Commissioners
Joe Hay,Jr., Melissa Rose Hodges,Mike Hoppock, and Karl Ryan.
Also present: Michael Schrage, City Manager;Jacob Wood, Deputy City Manager; Greg Bengtson,
City Attorney; and Shandi Wicks, City Clerk.
AWARDS AND PROCLAMATIONS
None.
CITIZENS FORUM
None.
PUBLIC HEARINGS AND ITEMS SCHEDULED FOR A CERTAIN TIME
None.
CONSENT AGENDA
(6.1) Approve the minutes of July 15, 2019.
19-0208 Moved by Commissioner Hoppock, seconded by Commissioner Hodges, to approve Agenda Item
No. 6.1. Aye: (5). Nay: (0). Motion carried.
ADMINISTRATION
(7.1) Approve Change Order No. 1 for the 2017 Water Main Replacement Project No. 2-
70016, Kansas Public Water Supply Loan Fund Project No. 2957.
Martha Tasker, Director of Utilities, explained the request, the project, fiscal impact and
action options.
Commissioner Hodges stated there was 203 miles of cast iron pipe and currently had taken
care of 31 ' miles and asked how much would be added with the change order. Ms. Tasker
stated the change order would add another half a mile so the total would be 32 miles. She
continued to state project 1 & 2 totaled $4 million and would cover approximately 7 miles.
Commissioner Hodges asked with the added $2 million dollars a year, it would add an
additional 3' to 4 miles. Ms. Tasker stated 3' miles would be about the right number.
Mayor Davis asked if there would be a point where we would get caught up. Ms. Tasker •
stated she did not think we would ever catch up, each year the pipe gets older.
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Mayor Davis asked if there was any health risk in the old wrought iron pipes. Ms. Tasker
stated it was in the water supply and there were some chemicals that were used in the
water.
Michael Schrage, City Manager, stated our approach was more proactive than many
= communities.
Commissioner Hodges asked if we had done any numbers on what our water rates would
y do if the population does not increase and remained flat. Ms. Tasker stated staff had
1,1 E worked with a spreadsheet that allows the population growth to be included. Debbie Pack,
Director of Finance & Administration, stated the totals were currently ran as pretty flat but
could be ran as a negative or with an increase. Mr. Schrage also provided additional
information on the numbers.
19-0209 Moved by Commissioner Hay, seconded by Commissioner Ryan, to approve Change Order No. 1
for the 2017 Water Main Replacement Project No. 2-70016, Kansas Public Water Supply Loan Fund
Project No. 2957 for Stevens Contractors, Inc. of Salina, Kansas revising the Total Contract Amount
to $1,751,094 and extending the Final Completion Date to April 5, 2020. Aye: (5). Nay: (0).
Motion carried.
(7.2) Resolution No. 19-7714 authorizing the offering for sale of water and sewer system
revenue refunding bonds,Series 2019B, including approval of a fiduciary agreement
for municipal advisory services specific to this revenue bond refunding action with
George K. Baum and approval of underwriter's selection.
Debbie Pack, Director of Finance & Administration, explained the issuance, the agreement
and the underwriter's selection.
Commissioner Hoppock asked if approved, how long before the sale would take place.
David Arteberry, George K. Baum & Company, stated the rating call with Moody's was
scheduled for July 25, 2019 and the rating would be released on August 5, 2019 and the sale
of the bonds later that same week or the next week.
Commissioner Hodges thanked staff and George K. Baum for their hard work.
19-0210 Moved by Commissioner Ryan, seconded by Commissioner Hay, to adopt Resolution No. 19-7714
authorizing the offering for sale of water and sewer system revenue refunding bonds, Series
2019B, including approval of a fiduciary agreement for municipal advisory services specific to
this revenue bond refunding action with George K. Baum and select Raymond James as the
underwriter for the bonds. Aye: (5). Nay: (0). Motion carried.
(7.3) Authorize publication of the Notice of Budget Hearing for the 2020 budget which
sets August 5th as the date of public hearing on the 2020 budget, and establishes the
maximum limits of the 2020 budget.
Debbie Pack, Director of Finance & Administration, explained the process, public hearing
dates, mill levy and maximum limits of the 2020 budget.
19-0211 Moved by Commissioner Hoppock, seconded by Commissioner Hodges, to authorize publication
of the Notice of Budget Hearing for the 2020 budget which sets August 5th as the date of public
hearing on the 2020 budget, and establishes the maximum mill rate and expenditure limits of the
2020 budget.
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Commissioner Ryan thanked staff for all of the background information and work on the process
for the budget. Michael Schrage, City Manager, thanked the City Commission and stated that staff
had identified items for improvement and would begin debriefing as soon as the 2020 budget was
behind us.
Mayor Davis called the question to authorize publication of the Notice of Budget Hearing for the
2020 budget which sets August 5th as the date of public hearing on the 2020 budget, and establishes
N the maximum limits of the 2020 budget. Aye: (5). Nay: (0). Motion carried.
(7.4) Resolution No. 19-7722 expressing the intent of the governing body of the City of
Salina, Kansas in response to the proposal by Salina Athletic Partners to enhance the -
baseball and softball experience in the City of Salina.
Michael Schrage, City Manager, explained the request, resolution of intent, fiscal impact
and action options.
Commissioner Hodges wanted to confirm that the way the funding mechanism was
proposed and the way the resolution was written, the City Commission would have to pass
two charter ordinance changes. Mr. Schrage stated yes. She continued to ask if those charter
ordinance changes would be subject to a protest petition. Mr. Schrage stated correct. She
further asked if going down the road we are now, a protest petition would be the only way
the citizenry at large would have a voice in this project through a public election. Mr.
Schrage stated the citizens could address the Governing Body but as far as the process goes,
that was the only thing he was aware of. Greg Bengtson, City Attorney, stated to the extent
the ultimate plan would require an increase beyond the current authorized limit, that
would be what prompts the need for the amendment and the resulting potential for a
petition and referendum.
Commissioner Hodges asked if the reason for the change in the charter ordinance was due
to the contractual agreement with Visit Salina or was it due to a state defined statutorily
defined use of transient guest tax. Mr. Schrage stated the process to set or increase the
transient guest tax rate was by charter ordinance. He continued to state it was not a
function of the agreement with Visit Salina; it was the process to amend the transient guest
tax rate.
Commissioner Hodges asked if the transient guest tax was required to be used for specific
purposes. Mr. Schrage stated there were statutory limitations on the uses of the transient
guest tax. He continued to state the project was a permissible use of the transient guest tax
under the stated purposes in the statute.
Commissioner Hodges asked if there had been similar projects for recreational facilities that
had used the transient guest tax as a funding source. Mr. Schrage stated the Bicentennial
Center wasn't necessarily recreational but noted that in 2009 the charter ordinance was
amended to increase the transient guest tax rate and a model was developed to allocate
funds between conventions and visitors bureau and the Bicentennial Center debt financing,
operation and maintenance.
Commissioner Hodges asked if the State of Kansas could adjust the transient guest tax rules
_ once a rate was set. Mr. Schrage stated STAR Bonds were an example, if transient guest tax
was in place and a STAR Bond district was approved, it would not necessarily capture the
existing transient guest tax revenue but any increment that the City consents to capturing
could be used for that purpose. He continued to state that the Department of Commerce
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factored that into their review and approval of a STAR Bond district. Mr. Schrage asked Mr.
Bengtson if he wanted to speak to an application of change in transient guest tax statutes
after a rate had been set. Mr. Bengtson stated it was difficult for him to anticipate a scenario
where that would be a problem once a previously authorized purpose was in place. He
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continued to state it was a question to answer with more than an off the cuff response that
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could be looked at in more detail.
Commissioner Hodges provided information on the STAR Bond districts and the potential
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for changes to STAR Bonds in the future and asked if the transient guest tax was secure and
= in the future we would not be looking to find an alternate funding source to cover the debt
payments. Mr. Schrage stated what you are really referring to might be how a statutory
change would affect a current process. Commissioner Hodges stated yes. Mr. Schrage
stated generally there was a premise that would observe and preserve something that was
already in place but to really be able to answer your question the City Attorney would need
to review the specifics related to a scenario that would affect transient guest tax statutes.
Commissioner Hodges asked who pays to play at East Crawford Recreation Area (ECRA)
and Bill Burke at the present time. Mr. Schrage stated there were no parks and recreation
programming at Dean Evans Stadium based on the dimensions of the field and the age of
the players but stated there was a fee structure for field play and for tournaments. He
continued to state that from a cost recovery standpoint let alone a revenue generation
standpoint to fund something like this, the fees that were in place were not where they
need to be to do that.
Commissioner Hodges noted Section 3B of the resolution and would like to remove "as
necessary" from the title. Mr. Schrage stated the expectation was to have the details of the
agreement simultaneously with the charter ordinance amendments and any financial
decisions. Mr. Bengtson stated that having including the "as necessary" language was
intended to cover the potential number of agreements necessary.
Commissioner Hoppock asked if the written agreements with the other parties would have
to go before the Governing Body for approval. Mr. Schrage stated yes.
Commissioner Hodges noted Section 3B5 and asked for clarification. Mr. Schrage stated the
language was intended to revisit the Cultural Arts Regional Marketing and the Bicentennial
Center debt.
Commissioner Hoppock asked if Section 3B5 could be addressed now or down the road.
Mr. Schrage stated it could be addressed now or in the future.
Commissioner Hodges stated the Parks Master Plan called out $2.8 million in deferred
maintenance and asked if that was the bulk of the items that was in phase 1 or were those
things divided amongst the phases. Mr. Schrage noted that most projects would have to be
value engineered and stated he would defer to Baseball Enterprises to determine if they
were included. Byron Tomlins, Salina Athletic Partners, stated that the patio project would
be paid for entirely out of private donations and stated the first phase would include re-
turfing the field, the drainage issues, the concessions stands and restrooms at Dean Evans
Stadium and resurfacing four (4) fields at Bill Burke Park. He continued to state Phase 1
did mention some of the items listed but not all of them.
Commissioner Hodges provided her thoughts on the potential partnership. Mr. Schrage
provided information on the drainage issue.
Commissioner Hodges asked if the patio experience was best to be completed first when
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other portions of the phases could have to be value engineered. Mr. Tomlins stated that the
patio experience would need to be completed prior to turfing Dean Evans Stadium.
Commissioner Hodges asked what the timeline looked like for the City's standpoint. Mr.
Tomlins stated that he had raised enough money to fully fund Phase 1 of the project
without City money. Mr. Schrage stated that details needed to be worked out and there
was a 60 day protest period for the Charter Ordinances and to get the financing completed
y
next year.
Mayor Davis asked what the latest date was that the protest petition would need to be
submitted. Mr. Schrage stated that once the charter ordinance was passed, there was a 60
day protest period.
Commissioner Hav asked how many votes would be required on a protest petition that
would require the question to go to a vote. Mr. Schrage stated the protest petition to make
it a valid petition would need to have signatures equivalent to 10% of the number of votes
casted in the last general election. He continued to state based on the November 2017
election, there were 5556 votes cast in the City election so the required number of
signatures equates to 556 valid signatures of registered voters.
Commissioner Hodges asked ' if there would be formal agreements with Baseball
Enterprises, USD #305, Kansas Wesleyan University and Sacred Heart. Mr. Tomlins stated
all of the other entities legal teams would like to review the written agreements and sign off
on them.
Commissioner Hodges asked have we received actual numbers of maintenance for artificial
turf versus the natural grass we have now. Mr. Schrage stated staff had conversations with
Baseball Enterprises on The maintenance of the turf and it being included in the modeling
completed by Baseball Enterprises.
Commissioner Hodges stated she had received requests from parents asking for an
additional entrance/exit to Bill Burke Park. Mr. Schrage stated there was an emergency exit
from the park in the case of inclement weather.
Commissioner Hodges stated that she had heard that we were going to lose the KSHSAA
events from Salina if we do not pursue this. Eric Brown, Salina Area Chamber of
Commerce, Executive Director, stated yes but KSHSAA would not go on record to say that
but the other venues were in better condition than ours. Mr. Schrage stated that the
tournament this year had to be relocated to Maize due to the wet weather and had
Conventions &Tourism staff commuting to Maize to work the tournament.
Commissioner Ryan asked staff to explain the transient guest tax, who it affects and what
other options would affect the community. Mr. Schrage stated staff had inventoried the
options and explained transient guest tax, mill levy, property tax, sales tax.
Commissioner Ryan stated that other communities were using the transient guest tax to
fund a similar project. Mr. Schrage stated yes, staff had looked at peer communities and
provided that information in the agenda item.
Commissioner Hodges asked what the total room tax was. Mr. Schrage stated it was 8.75%
plus 6.7%, totaling 15.45% and if a hotel was in the CID district, there would be an
additional percentage on top of the 15.45%.
Mayor Davis asked every mill increase was how much per year. Commissioner Hoppock
stated .84 mills to debt service$4 million.
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Mayor Davis asked if Section 3 just listed the items that the agreement would have in it. Mr.
Schrage stated the items listed in Section 3 were the topics that would be taken into
consideration.
Mayor Davis asked if there was any work being done for the patio now. Mr. Tomlins stated
not at the present time but could start at anytime. Mr. Schrage asked if design work had
been done. Mr. Tomlins stated that the design work was done but not physical work had
TTI been done. Kenny Hancock, Salina Baseball Enterprises Board Member, stated they had not
2 been on site to perform any work but stated they had asked to get on-site to conduct core
samplings.
0
U Mayor Davis asked about Section 3B5. Mr. Schrage stated it was part of the agreement with
Conventions & Visitors Bureau and was there to allow them to be included in the
agreement.
Mayor Davis asked if the agreement would specify what the City of Salina would be
responsible for. Mr. Schrage stated his intent would be to issue debt for the project and if
there was a shortfall it would have to be covered by the City of Salina. David Arteberry,
George K. Baum & Company, stated staff was correct that if there was a shortfall from
transient guest tax the City of Salina would still be required to cover the bond payments.
Lyle Parks provided information on the KSHSAA tournaments, specifically a newspaper
article regarding KSHSAA tournaments in Great Bend.
Stanley Weilert, S & B Motels, represented the hoteliers in the community, stated that none
of the hoteliers were against the project but we do not agree with how it is being financed.
He asked if there were any City Commissioners on the Committee for the Salina Athletic
Partners. The City Commission announced no. Mr. Weilert provided information to the
City Commission on transient guest tax, explained the total room tax and how the increase
would affect the hotel industry in Salina. He continued to provide information on the
financing of the Bicentennial Center. He asked if the money was coming privately, by
grants, or by USD #305. Mr. Tomlin stated he did not want to answer that question. Mr.
Weilert continued to provide information on the affect the request would have on the
hoteliers. Mr. Schrage provided clarification on items discussed, he stated that a
discussion was made by the city Commission three (3) weeks ago and explained the STAR
Bond project and the bond financing in relation to the new hotel in downtown Salina.
Makish Patel asked if Baseball Enterprises would fall short of their goal, what would
happen. Mr. Tomlins stated they would not fall short. Mr. Schrage stated that if a shortfall
occurred, that would need to be identified and addressed at the time financing for the
project occurred. Mr. Patel stated that it was said that the tournaments would not remain in
town if the fields were not improved. Mr. Schrage stated it was his understanding that the
tournaments would not remain in town unless improvements were made to the fields. Mr.
Patel stated that his hotels were in favor of the additional tax.
Norman Mannel, Salina, stated another funding source should be used and asked if a
protest petition would be filed, would the follow-up action be required to be approved by
all members of the City Commission. Mr. Bengtson stated an initial action amending a
charter ordinance required a 2/3rd majority and if there was a successful protest petition
that would become a referendum that would determine if action would be taken or not. He
stated that there was a statute that dealt with a legislative act that would require an item to
not be acted on again for ten (10) years.
Page 6
Nick Bhakta, Baymont Inn & Suites and American Inn & Suites, asked if it was too late to
propose the increase towards sales tax instead of transient guest tax and asked which
process was quicker to amend the sales tax or transient guest tax. Mr. Schrage stated the
charter ordinance process was quicker than raising the sales tax which had to go for a vote
for approval. Mr. Schrage provided information on the process for a sales tax increase.
2
Jon Blanchard, 250 S. Ninth Street, provided information on the request of Stanley Weilert
on approval of funding for a convention center and hotel in the past. He continued to
provide his thoughts on the financing of the project. He further asked if there were any
= attorney general opinions on the statute regarding the definition of promotion of
convention and tourisms. He lastly recommended to the City Commission to find a way to
let the voters vote on this request.
Mayor Davis asked if anyone would have the authority to place an item on the November
ballot. Mr. Bengtson stated the approval for the issuance of bonds for this type of project
was something that could be structured to include the referendum aspect and if the
transient guest tax was the means of financing or supporting the debt service on the bonds,
the charter ordinance would be need to be amended due to a modification of a statute.
Commissioner Hodges asked if the City Commission did put something to the vote of the
people could you deal with both questions within the one question or would it need to be
two separate questions. Mr. Schrage stated there were two (2) questions there; (1) whether
raising the transient guest tax was a topic that could be put on the ballot for a vote; and (2)
could that all be turned into one ballot question rather than two separate votes. He
continued to state that staff had approached bond counsel on whether this project was an
eligible expenditure of transient guest tax and they indicated that it was. He further stated
that he could not state whether that was based on an attorney general opinion or whether
bond counsels legal opinion.
Roger Struble, member of Salina Athletic Partners, provided historical background on
baseball in the community,his thoughts on the request and the need for citizen input on the
request.
Paul McAfee, 2509 Calcutta Drive, provided his thoughts on the request.
Eric Brown, President & CEO, Salina Area Chamber of Commerce, stated it was hard for
his organization and it was a double edge sword, apologized to the hoteliers for not
providing enough information to them and stated that the loss of income from the softball
and baseball community would affect the community. He continued to state that Visit
Salina would not be writing a check to the project but would be supporting the project and
continue to support the retail and trade that happens in the community.
The City Commission recessed at 6:32 p.m. for a break. The meeting resumed at 6:48 p.m.
Commissioner Hay stated that he had received several phone calls to encourage the project
and mentioned one phone call that was against the project. He continued to state that if we
let this go,we are missing the boat and the youth deserve it.
Commissioner Ryan stated he felt it was the most reasonable financing and was all for the
project and funding it in this form.
Commissioner Hoppock stated that Salina as usual had done a great job using the public-
private partnership and liked the development agreement that would help prioritize the
project and where the funds were coming from and how they were going to be used. He
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continued to state the funds of the private partnership would be used first before the public
funds. He further stated all the documents would be approved by the City Commission
and was concerned of the deferred maintenance that could fall to the taxpayers with a
potential property tax increase. He continued to provide information on the use of transient
guest tax for the project and stated that he was hoping it would be a pass through and Visit
Salina would continue to market the City.
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Commissioner Hodges asked if there was a specific reason why Salina Baseball Enterprises
did not want to elaborate on where the money was from. Mr. Tomlin stated that the
=7.2 donations they had were from private donors that did not want to be made public.
Commissioner Hodges stated that there was no painless taxing mechanism and it was an
extremely tough decision that she did not take lightly. She continued to ask staff, if it was
palatable to the rest of the Governing Body to include in Section 3B documents by written
agreements including but not limiting to.
Commissioner Hoppock asked if the charter ordinance could not be placed for transient
guest tax directly on a ballot. Mr. Bengtson stated that was correct. He continued to state
the charter ordinance process was set forth in the Constitution and was the section that
pertained to the home rule amendment. He further stated the home rule amendment
allowed cities to take care of their own affairs and the charter ordinance was applicable in
this case because of the change in the transient guest tax. He continued to explain the home
rule amendment and a charter ordinance amendment.
Commissioner Hoppock asked if a charter ordinance was used to fund the fieldhouse. Mr.
Schrage stated there was a charter ordinance to raise the self-imposed debt limit but not
related to funding. He also asked if there was a charter ordinance used for the Tony's Pizza
Events Center. Mr. Schrage stated there was a charter ordinance passed in 2009 that
increased the transient guest tax rate at that time and part of that agreement at that time
related to the allocation to the conventions and visitors' bureau and the Bicentennial
Center.
Mayor Davis stated the use of sales tax was not a favorable option due to the sales tax on
food. He continued to state that he was concerned about the hole we would have if we do
not do this and could not afford to go backwards. He further stated the protest petition
process works if there was enough will out there, and provided an example of the clean
indoor air act going before a vote.
Mr. Schrage stated that staff would stand ready to proceed in whatever direction the City
Commission wanted to move in.
Mayor Davis asked if the proposal was to raise the transient guest tax 1.3% or 1.5%. Mr.
Schrage stated the proposed increase would be 1.3%.
Mr. Bengtson wanted to be sure that we were clear that we want to address the clarification
on Section 3 subsection B. Commissioner Hodges stated she would like it to read
"document by written agreements including but not limiting to the following items"
19-0212 Moved by Commissioner Hoppock, seconded by Commissioner Ryan, to adopt Resolution No. 19-
7722 expressing the intent of the governing body of the City of Salina, Kansas in response to the
proposal by Salina Athletic Partners to enhance the baseball and softball experience in the City of
Salina with the change to Section 3B reading document by written agreement including but not
limited to the following items. Aye: (5). Nay: (0). Motion carried.
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DEVELOPMENT BUSINESS
None.
OTHER BUSINESS
(9.1) Request for executive session (legal).
I move the city commission recess into executive session for _ minutes to discuss
g the subject of the City of Salina's legal options in response to a request from the low
bidder for the Police Training Facility project, Cheney Construction, Inc., to
withdraw its previously submitted bid with legal counsel based upon the need for
consultation with an attorney for the public body which would be deemed
privileged in the attorney-client relationship pursuant to K.S.A. 75-7319(b)(2). The
open meeting will resume in this room at p.m.
19-0213 Moved by Commissioner Hodges, seconded by Commissioner Hay, to recess into executive
session for 30 minutes to discuss the subject of the City of Salina's legal options in response to a
request from the low bidder for the Police Training Facility project, Cheney Construction, Inc., to
withdraw its previously submitted bid with legal counsel based upon the need for consultation
with an attorney for the public body which would be deemed privileged in the attorney-client
relationship, pursuant to K.S.A. 75-7319(b)(2),. The open meeting will resume in this room at 7:45
p.m. Aye: (5). Nay: (0). Motion carried.
The City Commission took a 10 minute break and then recessed into executive session at
7:15 p.m. and reconvened at 7:45 p.m.
19-0214 Moved by Commissioner Hoppock, seconded by Commissioner Hodges, that the July 17, 2019
notice of withdrawal of bid by Cheney Constriction, Inc. for the Salina Regional Training Center be
accepted and staff be directed to proceed with review of the remaining bids in preparation for
consideration of award of the contract by the Governing Body. Aye: (5). Nay: (0). Motion carried.
ADJOURNMENT
19-0215 Moved by Commissioner Hoppock, seconded by Commissioner Hodges, that the regular meeting
of the Board of City Commissioners be adjourned. Aye: (5). Nay: (0). Motion carried. The meeting
adjourned at 7:48 p.m. •
[SEAL] Trent W. Davis, M.D., Mayor
ATTEST
Shandi Wicks,CMC,City Clerk
II
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