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Amtrak to end food service losses

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Posted by Paul Milenkovic on Monday, October 7, 2013 12:21 PM

I do not think the problem is with Amtrak, and I do not think the problem is with Congress, except perhaps indirectly.  I do think the problem is with and within the advocacy community, and I advance the discussion here as Exhibit A in making my case.

I mean who is Congress apart from the people who elect its members and inform its members on what we want.  And most people are rather indifferent to trains except for the minority of people who really care about trains, whose views are represented here.

I have never said "get rid of the long distance trains and concentrate on the corridor trains" or the other way around.  I have, however, expressed the opinion that the "goodness" that we achieve from Amtrak, and yes, taking into account the subsidies that go to highways and airways, is not great enough in relation to the per passenger or per passenger mile expenditure on Amtrak to justify a serious expansion of Amtrak beyond current funding levels.

The politics of Amtrak has been such that Amtrak has been pretty much on an even keel of public expenditure, adjusted for inflation, since its inception.  There are Perils of Pauline threats that gets Amtrak tied to the tracks (in front of a rushing freight train), and a lot of energy gets expended complaining about these threats, which haven't materialized after years of trying by the anti-train people.  There are other proposals to expand Amtrak -- I guess we shall see how the CA HSR works out -- but to date they haven't gotten very far either. 

So maybe when I observe that the cost-benefit ratio does not favor expanding Amtrak, I am simply commenting on the state of affairs rather than advocating that Amtrak not expand.

But what happens is that there is a faction within the community of people who like trains and want trains, I speak of this as the "advocacy community" as a shorthand for the long run of words.  There is a faction within the greater advocacy community of persons who likes Amtrak or at least the modes of Amtrak service-thank-you-very-much and is resistant to any and all proposals to "reform" Amtrak in any serious way.  The cost-benefit ratio is dismissed with "all the other modes receive subsidy" and that it is "a matter of political will to come up with the money (to run Amtrak or perhaps even expand Amtrak in its current form)."

Traditionally it had been railroad industry people with a conservative streak of "That idea was tried, and it was a 'failure'", but as of late it is people in the advocacy community who are set in what they want from Amtrak and don't want to see any changes.

I am pretty set in my ways and don't want to see any changes either -- with a lot of things.  But in the absence of changes in Amtrak, we are going to see Amtrak pretty much the way it is, with the Perils of Pauline thing happening every few years as the pendulum swings in political cycles.  And Amtrak the-way-it-is carries about a tenth of 1 percent of total U.S. passenger miles and is making a microscopic difference in congestion relief, providing a less stressful travel mode, reducing fuel consumption, accomodating people who cannot or will not take a cramped bus or plane, and so on.

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by henry6 on Monday, October 7, 2013 12:39 PM

Buy an automobile for basic transportation.  All you need is a frame, a cab for a seat, a steering wheel and a motor.  A comfortable and adjustable seat, heat and air conditioning, wipers, radio are all beyond basic.  What will you buy?

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Posted by schlimm on Monday, October 7, 2013 1:15 PM

henry6

Buy an automobile for basic transportation.  All you need is a frame, a cab for a seat, a steering wheel and a motor.  A comfortable and adjustable seat, heat and air conditioning, wipers, radio are all beyond basic.  What will you buy?

Not much of an analogy.   A more accurate one is you want a subsidized (by other car buyers and the government) BMW instead of the Honda Civic.

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Posted by schlimm on Monday, October 7, 2013 1:18 PM

Paul Milenkovic
But in the absence of changes in Amtrak, we are going to see Amtrak pretty much the way it is, with the Perils of Pauline thing happening every few years as the pendulum swings in political cycles.  And Amtrak the-way-it-is carries about a tenth of 1 percent of total U.S. passenger miles and is making a microscopic difference in congestion relief, providing a less stressful travel mode, reducing fuel consumption, accomodating people who cannot or will not take a cramped bus or plane, and so on.

Well said!!   I could not agree more.   You call them "the advocacy community" while I call them "nostalgia buffs" but we are talking about the same resistance to improving Amtrak so it can strive toward any of the desirable outcomes you mention above.

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Posted by henry6 on Monday, October 7, 2013 1:42 PM

Totally disagree with the idea that all passenger rail supporters are nostalgia buffs.  Totally disagree.  While I enjoy looking at and remembering the past, I in no way consider it the way passenger railroads should operate now or in the future....the past is a great place to visit and dream about, but no a place to live.  No where else in the world could one say that when you see how technologically advanced and how much used rail service are in Europe and Asia.  The US is too stuck in the mentality of the American Wild West as portrayed by Hollywood and not look at the future to be nothing more than a replay of the past.  And I know all of you are skating around your political views but lets face it: many of you don't want to accept the fact that government has to get involved in passenger rail as deeply as they are in water, air, and highways. But if you want Amtrak closed down and done away with, say so and not dance around the topic.  If you believe in a future for passenger rail, a need for it, that is has to be included in the transportation mix, no holds barred, then say that.  But picking little things and each other apart isn't going to prove or do anything but fill forum pages.

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Posted by schlimm on Monday, October 7, 2013 1:57 PM

henry6
And I know all of you are skating around your political views but lets face it: many of you don't want to accept the fact that government has to get involved in passenger rail as deeply as they are in water, air, and highways. But if you want Amtrak closed down and done away with, say so and not dance around the topic.  If you believe in a future for passenger rail, a need for it, that is has to be included in the transportation mix, no holds barred, then say that.

I do not hold any such views.  You attempt to smear those who disagree with your insistence that Amtrak must preserve an out-of-date long distance passenger service.  If anything, your (and the NRPA's) rigid nostalgia for days gone by is why 40 years later, other than the NEC and some state-supported short corridors, Amtrak is a mess.  If the LD services were shut down tomorrow, few would notice or mourn.

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Posted by henry6 on Monday, October 7, 2013 2:06 PM

But Schlimm, I don't believe Amtrak should preserve an out of date anything but modernize to the latest technology and philosophies of passenger train operations.  The past is gone...I'm over it, I'm looking at what can be built on, what has to be thrown away, and what has to be done.  But I disagree that a loss of LD service would not be noticed or mourn.  LD trains serve a purpose for transportation of local people from place to place but in order to pay the bills, longer distance, non daily riders have to be enticed aboard. Marketing...that is planning, designing equipment and schedules and frequency, pricing, advertising, to provide a service...is what is needed and not second guessing by politicians.

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Posted by schlimm on Monday, October 7, 2013 2:07 PM

henry6
 No where else in the world could one say that when you see how technologically advanced and how much used rail service are in Europe and Asia.  

I am personally very familiar with train services in Europe and to a lesser extent, in China.  Their services are used heavily because they are not providing 50 year old-style services as we do with our LD trains which you and the NRPA so adamantly support.  They are providing a modern rail network with HSR and HrSR as the centerpieces..

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Posted by schlimm on Monday, October 7, 2013 2:13 PM

Marketing starts with a product, and trying to sell LD trains with sleepers and diners to a shrinking generational cohort is like trying to sell some 1955 Buick Roadmasters.   The nostalgia buffs might buy (if cheap enough) but not the general public.  

Insistence on the sleepers and diners for occasional riders would be fine, IF they helped offset the losses the LD train incur.  But they don't.  They add to the loss, maybe even double it. 

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Posted by henry6 on Monday, October 7, 2013 2:31 PM

Schlimm your last two posts support what I am saying should be done but making me seem to have said something else!

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Posted by V.Payne on Monday, October 7, 2013 9:29 PM

I guess I am Oltmannd's #3. The primary problem with current LD operations is that a revenue capacity of about twice what is provided today is needed for each train to reach a financial efficiency point where short-term variable costs (including food service) and some capital are covered. You don't get there by eliminating opportunities to attract more markets to the same train schedule by reducing amenities. 

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Posted by schlimm on Monday, October 7, 2013 10:21 PM

And that is why a cost analysis is needed.  You won't increase revenue to the break-even point by continuing to underprice the product because the costs are not fixed and extra passengers will not add sufficient marginal revenue to cover even above the rails costs.   The labor component is not competitive and too often sub-standard.

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Posted by AMTRAKKER on Tuesday, October 8, 2013 3:49 AM

What level of government spending was required in these countries to build and then sustain this level of service?

Would you accept an initial outlay to Amtrak to build a similar service , then an ongoing  Amtrak subsidy that was proportionate to these countries if Amtrak provided high speed service?

 

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Posted by oltmannd on Tuesday, October 8, 2013 6:25 AM

henry6
Buy an automobile for basic transportation.  All you need is a frame, a cab for a seat, a steering wheel and a motor.  A comfortable and adjustable seat, heat and air conditioning, wipers, radio are all beyond basic.  What will you buy?

What will I buy?  With my money?  Or, some of my money and some from my "supporters"?  Or, with somebody else's money?

Gotta finish the question properly in order for the analogy to work.

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Posted by oltmannd on Tuesday, October 8, 2013 6:30 AM

AMTRAKKER

What level of government spending was required in these countries to build and then sustain this level of service?

Would you accept an initial outlay to Amtrak to build a similar service , then an ongoing  Amtrak subsidy that was proportionate to these countries if Amtrak provided high speed service?

My feeling is the US citizens and Congress would not blanch at billions to build some HSR routes (or even HrSR routes) as long as they weren't on the hook for long term operating subsidies.  

This may not be the optimum case - e.g. you might be better off spending a fraction on construction of HrSR and feed it an operating subsidy than multiples on HSR to avoid the operating subsidy.  

The two, pivotal events right now are the California HSR project and "All Aboard Florida".  Any measure of success on these could lead to more of the same.

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Posted by oltmannd on Tuesday, October 8, 2013 6:43 AM

henry6
Buy an automobile for basic transportation.  All you need is a frame, a cab for a seat, a steering wheel and a motor.  A comfortable and adjustable seat, heat and air conditioning, wipers, radio are all beyond basic.  What will you buy?

Or is the analogy for Amtrak's equipment capital plan?   "Amfleet is getting old.  I don't want to think about catching up on all the deferred maintenance and mods in the fleet.  That makes me tired just thinking about it. We'd like some new coaches.  What should we get?"   Instead of "Marketing tells us we will have 5% growth a year on these routes.  We need 5000 new seats in coaches to support that growth.  What is the lowest cost of ownership path to acquire that capacity?"

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Posted by schlimm on Tuesday, October 8, 2013 7:59 AM

oltmannd

My feeling is the US citizens and Congress would not blanch at billions to build some HSR routes (or even HrSR routes) as long as they weren't on the hook for long term operating subsidies.  

This may not be the optimum case - e.g. you might be better off spending a fraction on construction of HrSR and feed it an operating subsidy than multiples on HSR to avoid the operating subsidy.  

The two, pivotal events right now are the California HSR project and "All Aboard Florida".  Any measure of success on these could lead to more of the same.

1. Distance between major nodes is a major factor in terms of needed speed.

2. Incremental approaches are also useful, as you and others have noted.

3. A middle ground between 225 and 110 mph (175?) might make more sense and be cheaper.

4. Amtraker seems to think HSR and HrSR are too expensive for us, yet so many other industialized nations seem to be able to afford.  I would ask why it is that folks like him who apparently like Amtrak don't want HSR here?   After all, the only portion of Amtrak that covers above rail expenses is the Acela service, actually showing a surplus.

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Posted by henry6 on Tuesday, October 8, 2013 8:21 AM

Need 5000 seats....ok...but you need 5000 usable and saleable seats.  Tie down some Adirondack chairs on a flat car or upholstered turn back seat with head rests and antimacassars and leg rests and cup holders,  two by two with tinted picture windows?  Tilt back for sleeping or ridged?  

The seat capacity is also not just determined by the 5000 actual seats but also by how many times the car is used per day,..thus a 80 seat car on four trains a day is actual 320 seat capacity....more if the seat is turned over, used more than once per trip...

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Posted by Anonymous on Tuesday, October 8, 2013 9:02 AM

In FY12 all three of the NEC service lines (Acela, NE Regional, and NE Special Trains) generated an operating profit ($206.5 million, $72.2 million, and $3.2 million).

The Washington-Lynchburg, Washington-Newport News, and Carolinian State Supported....... trains also generated an operating profit ($8.4 million, $3.0 million, and $.9 million).  The Washington-Lynchburg and Washington-Newport News trains are really extended NEC regional trains.  Whether the Virginia extensions generated an operating profit is unclear.

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Posted by oltmannd on Tuesday, October 8, 2013 9:29 AM

henry6
The seat capacity is also not just determined by the 5000 actual seats but also by how many times the car is used per day,..thus a 80 seat car on four trains a day is actual 320 seat capacity....more if the seat is turned over, used more than once per trip...

Geez, no kidding! 

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Posted by oltmannd on Tuesday, October 8, 2013 9:31 AM

henry6
Need 5000 seats....ok...but you need 5000 usable and saleable seats.

But, you don't let the Mechanical department make that determination!  (Exactly who do you think was the primary author of Amtrak's fleet plan?)

The "old school" of railroading is one where the Mechanical Dept. "owns" the equipment, so they'll have something to work on, I suppose.  If you are lucky, they'll let the operating dept use it once and a while.  Marketing's job is to figure out how to price the service the operating dept decides to provide.  Sales gets to advertise it.  It's classic "Tail wagging the dog".

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Posted by oltmannd on Tuesday, October 8, 2013 9:33 AM

schlimm
Amtraker seems to think HSR and HrSR are too expensive for us,

I'm not sure they think much about it at all. Wink

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Posted by schlimm on Tuesday, October 8, 2013 9:40 AM

Sam1

In FY12 all three of the NEC service lines (Acela, NE Regional, and NE Special Trains) generated an operating profit ($206.5 million, $72.2 million, and $3.2 million).

The Washington-Lynchburg, Washington-Newport News, and Carolinian State Supported....... trains also generated an operating profit ($8.4 million, $3.0 million, and $.9 million).  The Washington-Lynchburg and Washington-Newport News trains are really extended NEC regional trains.  Whether the Virginia extensions generated an operating profit is unclear.

Even better!   More evidence of the value of short corridors - people use them, heavily.  And the operating loss of the long distance trains is...?   And what percentage is that of Amtrak's overall operating loss?
Fares on NEC between NYP and PHL = .$.58 - 1.65 per mile.  Fare between CHI and Fargo = $ .14 - .24 per mile.  So Amtrak is charging a premium in the NEC to subsidize the below cost fares for the EB, a typical LD train (not the worst performer).  This is not right.

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Posted by Paul Milenkovic on Tuesday, October 8, 2013 11:22 AM

Don, this is what I find absolutely amazing.

You come along, and you didn't propose some kind of dodgy "Amtrak reform", you merely linked to Amtrak drafting a plan to improve the management of onboard food service.  This is something that Amtrak wants to do, apply modern management methods to their dining and cafe cars.

And the kind folks who are participating in this forum have run this thread up to, what is it, 5 or 6 pages, arguing the merits of this?

This isn't Congress mandating something, this isn't the Heritage Foundation with a crazy idea, this is Amtrak's management, out of their dedication to their jobs, wanting to make food service work better according to some metric, and this is controversial?  People are arguing about this?

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by PNWRMNM on Tuesday, October 8, 2013 11:25 AM

schlimm
Fares on NEC between NYP and PHL = .$.58 - 1.65 per mile.  Fare between CHI and Fargo = $ .14 - .24 per mile.  So Amtrak is charging a premium in the NEC to subsidize the below cost fares for the EB, a typical LD train (not the worst performer).  This is not right.

What is not right and why?

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Posted by cx500 on Tuesday, October 8, 2013 11:40 AM

Sam1

In FY12 all three of the NEC service lines (Acela, NE Regional, and NE Special Trains) generated an operating profit ($206.5 million, $72.2 million, and $3.2 million).

The Washington-Lynchburg, Washington-Newport News, and Carolinian State Supported....... trains also generated an operating profit ($8.4 million, $3.0 million, and $.9 million).  The Washington-Lynchburg and Washington-Newport News trains are really extended NEC regional trains.  Whether the Virginia extensions generated an operating profit is unclear.

 

What the NEC does is provide service in volume, and that makes the difference.  The more volume, the cheaper the unit cost, in virtually any field.  The problem with passenger trains in North America is that a single daily (or tri-weekly) train will never be able to generate volume.  For certain corridors, expanding the service may generate the volumes necessary to look as good as the NEC financials.  Frequent departures mean that a train may be available at the time a passenger wishes to travel, and so it becomes a viable option.  But to expand requires investment in additional equipment and tracks, which is almost impossible with today's negative attitude.  Note that while speed helps, frequency is more important.  The best way to save 2 hours on a trip is not having to wait four hours (or until tomorrow) for the next train.

While this obviously best fits the corridor model, we should not lose sight of the fact that many LD trains also serve a corridor function in certain segments of their route.  But with only one daily schedule the times are mostly too inconvenient to encourage use.  Or the seats are already filled with longer distance travelers.

John

 

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Posted by schlimm on Tuesday, October 8, 2013 1:01 PM

Paul Milenkovic

Don, this is what I find absolutely amazing.

You come along, and you didn't propose some kind of dodgy "Amtrak reform", you merely linked to Amtrak drafting a plan to improve the management of onboard food service.  This is something that Amtrak wants to do, apply modern management methods to their dining and cafe cars.

And the kind folks who are participating in this forum have run this thread up to, what is it, 5 or 6 pages, arguing the merits of this?

This isn't Congress mandating something, this isn't the Heritage Foundation with a crazy idea, this is Amtrak's management, out of their dedication to their jobs, wanting to make food service work better according to some metric, and this is controversial?  People are arguing about this?

Blame me, in part,  then for expanding the topic to examining LD services.  

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Posted by Anonymous on Tuesday, October 8, 2013 1:44 PM

schlimm

Sam1

In FY12 all three of the NEC service lines (Acela, NE Regional, and NE Special Trains) generated an operating profit ($206.5 million, $72.2 million, and $3.2 million).

The Washington-Lynchburg, Washington-Newport News, and Carolinian State Supported....... trains also generated an operating profit ($8.4 million, $3.0 million, and $.9 million).  The Washington-Lynchburg and Washington-Newport News trains are really extended NEC regional trains.  Whether the Virginia extensions generated an operating profit is unclear.

Even better!   More evidence of the value of short corridors - people use them, heavily.  And the operating loss of the long distance trains is...?   And what percentage is that of Amtrak's overall operating loss?

In FY12 the long distance trains carried 15.2% of Amtrak's system passengers, generated 24.4% of system revenues, and accounted for 41.4% of operating costs. They had an operating loss of $600.9 million or 120% of Amtrak's operating loss. This seeming anomaly occurs because of the offsetting operating profit on the NEC.
Sleeping car passengers accounted for 14.6% of long distance passengers and 2.2% of system passengers. They generated 35.2% of the long distance revenues.  Amtrak does not report publicly the operating costs of serving sleeping car passengers.
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Posted by oltmannd on Tuesday, October 8, 2013 1:50 PM

Paul Milenkovic

Don, this is what I find absolutely amazing.

You come along, and you didn't propose some kind of dodgy "Amtrak reform", you merely linked to Amtrak drafting a plan to improve the management of onboard food service.  This is something that Amtrak wants to do, apply modern management methods to their dining and cafe cars.

And the kind folks who are participating in this forum have run this thread up to, what is it, 5 or 6 pages, arguing the merits of this?

This isn't Congress mandating something, this isn't the Heritage Foundation with a crazy idea, this is Amtrak's management, out of their dedication to their jobs, wanting to make food service work better according to some metric, and this is controversial?  People are arguing about this?

Down the rabbit hole, we go!

There aren't any forum restrictions on animal burrows, apparently.

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Posted by oltmannd on Tuesday, October 8, 2013 2:28 PM

Paul Milenkovic

Don, this is what I find absolutely amazing.

You come along, and you didn't propose some kind of dodgy "Amtrak reform", you merely linked to Amtrak drafting a plan to improve the management of onboard food service.  This is something that Amtrak wants to do, apply modern management methods to their dining and cafe cars.

And the kind folks who are participating in this forum have run this thread up to, what is it, 5 or 6 pages, arguing the merits of this?

This isn't Congress mandating something, this isn't the Heritage Foundation with a crazy idea, this is Amtrak's management, out of their dedication to their jobs, wanting to make food service work better according to some metric, and this is controversial?  People are arguing about this?

There's a couple things going on, I think.  

One is the "protect the LD train" crowd gets a bit anxious anytime someone suggests a change to the service.  Every change often gets looked at as a veiled attempt to somehow destroy LD trains and all of Amtrak with it.  It's even been suggested here that breaking even on food service means getting rid of food service on LD trains even though Amtrak's plans include nothing of the sort.  Perhaps some of the anxiety is born from knowing deep down that the LD trains are extremely hard to justify to non railfans?

The second is related and I think it's trying to square up that Amtrak may actually agree with some of their harshest critics on some things.  Mica holds his circus about Amtrak losing money on food.  Amtrak reacts by coming up with a plan to break even on food.  Coincidence?  Not likely.  Might the critics be right about other things?  I think it's more of an indication that Amtrak is slowly waking up - which can't be anything but good. Maybe being forced to wear the clown suit you unknowingly wove for yourself in public is embarrassing?   If you don't want to be a "target", then don't paint bulls-eyes on yourself!

If you mind is made up that...

1) Amtrak is doing the best they can with what they have (I used to think this)

2) Amtrak is staffed by "true believers" who run a tight ship and know what a "real" passenger train is. (I used to think this, too!)

3) A map full of lines is a transportation network and more are better.  (I like maps!)

...you're going to have a hard time assimilating any information that runs contrary to your beliefs.  It's pretty well known that people tend to ignore new, conflicting information, or at the minimum, try to bend it to fit their beliefs. I think that's what's going on here.

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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