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CITY OF MUSKEGON CITY COMMISSION MEETING NOVEMBER 23, 2021 @ 5:30 P.M. MUSKEGON CITY COMMISSION CHAMBERS 933 TERRACE STREET, MUSKEGON, MI 49440 MINUTES The Regular Commission Meeting of the City of Muskegon was held at City Hall, 933 Terrace Street, Muskegon, MI at 5:30 p.m., Tuesday, November 23, 2021, Pastor Jeremy Lenertz, First Wesleyan Church, opened the meeting with a prayer, after which the Commission and public recited the Pledge of Allegiance to the Flag. ROLL CALL FOR THE REGULAR COMMISSION MEETING: Present: Mayor Stephen J. Gawron, Vice Mayor Eric Hood, Commissioners Dan Rinsema-Sybenga, Willie German, Jr., Ken Johnson, and Teresa Emory, City Manager Frank Peterson, City Attorney John Schrier, and City Clerk Ann Meisch. Absent: Commissioner Michael Ramsey HONORS, AWARDS, AND PRESENTATIONS: A. Years of Service Award/Recognition The Mayor and Commissioners congratulated and thanked city employees for various levels of years of distinguished, loyal service. Certificates of Appreciation were presented to those employees that were in attendance. B. 2021 Lead Program Success The City’s Community and Neighborhood Services department achieved a major milestone of being #1 in the State of Michigan for lead abatement through the Medicaid CHIP grant. Twenty-five units were made lead safe within Muskegon County through this work to prevent and treat childhood lead poisoning. PUBLIC COMMENT ON AGENDA ITEMS: Public comments were received. 2021-103 CONSENT AGENDA: A. Approval of Minutes City Clerk SUMMARY OF REQUEST: To approve the minutes of the November 8, 2021 Worksession and the November 9, 2021 Regular Meeting. STAFF RECOMMENDATION: To approve the minutes. Page 1 of 12 B. DDA/BRA Board Resignation City Clerk SUMMARY OF REQUEST: To accept the resignation of Francena DePung from the Downtown Development Authority/Brownfield Redevelopment Board, effective immediately. Term expires 1/31/2023. STAFF RECOMMENDATION: To accept the resignation. C. First Quarter Budget Reforecast Finance SUMMARY OF REQUEST: At this time staff is asking for approval of the 1st Quarter Budget Reforecast for the FY 2021-22 budget year. In the General Fund we are now projecting revenues of $34,335,322 and expenses of $36,081,416 for a net loss of $1,746,094. The Finance Director’s First Quarter Budget Reforecast highlights are provided in the packet. STAFF RECOMMENDATION: To approve the 1st Quarter FY2021-22 Budget Reforecast as presented. D. Extension of the CDBG Program Administration Agreement between Norton Shores and City of Muskegon for Fiscal Year 2021 CNS SUMMARY OF REQUEST: To approve a one-year extension of the 2019-2020 CDBG Program Administration Agreement between Norton Shores and City of Muskegon to cover July 1, 2021 through June 30, 2022. Norton Shores is requesting a one-year extension of the two-year CDBG Programs Administrative Agreement. STAFF RECOMMENDATION: To approve a one-year extension of the CDBG Program Administration Agreement between Norton Shoes and City of Muskegon from July 1, 2021-June 30 2022. E. Brownfield Development & Reimbursement Agreement, Adelaide Pointe QOZB, LLC (Adelaide Pointe Project) 1148 and 1204 West Western Avenue Economic Development SUMMARY OF REQUEST: Approval of the Brownfield Development and Reimbursement Agreement for the Adelaide Pointe Project QOZB, LLC (Adelaide Pointe Project) and to consider the resolution. The project seeks to transform the 35-acre site into a development that will expand public access to waterfront activities through the creation of a 280-slip marina, up to 400 new residential condominium units, dry stack marina and boat storage, and commercial/retail space. Plans for the site have begun and will continue through Fall 2030. Total private investment, not including property acquisition, is approximately $250 million. The Brownfield Plan Amendment was approved by the Authority on October 12, 2021 and the City Commission on October 26, 2021. The Brownfield Plan is for a period of 30 years and includes total Brownfield Eligible Activity costs estimated Page 2 of 12 at $66,775,378; which includes $54,166,757 of Developer Eligible Activities and $12,608,621 of City Eligible Activities. The property is within the DDA and it is anticipated that all taxes captured will go towards the Brownfield TIF during the life of the Plan. Developer Eligible Activity expenses include – due care, environmental response activities, asbestos, demolition, site preparation, infrastructure improvements, Brownfield Plan preparation, administration costs, and interest expenses (5%). City Eligible Activity expenses include – roadways, water and sewer infrastructure, boat ramp/lift well and site preparation. The Development & Reimbursement Agreement outlines the procedures for the Authority to reimburse the City and Developer for eligible expenses within the Brownfield Plan. The Authority shall first pay 100% of the available Brownfield TIF Revenue to the City to reimburse the costs of City Eligible Activities. The Authority, following reimbursement to the City, shall pay 100% of the available Brownfield TIF Revenue to the Developer to reimburse the cost of Developer Eligible Activities. The Developer and City will provide the BRA a request for payment of eligible expenses. The BRA has 30 days to approve the request. Payments are made on a semi-annual basis when incremental local taxes are captured and available. The BRA approved this Agreement at its November 9, 2021 meeting. STAFF RECOMMENDATION: Approval of the Adelaide Pointe QOZB, LLC Brownfield Development and Reimbursement Agreement and authorize the Mayor and City Clerk to sign. H. MMRMA Settlement Agreement EEO & Employee Relations SUMMARY OF REQUEST: On July 24, 2021 the property of Don & Thearetta Bailey at 1360 8th Street sustained damages due to a sewer backup. Mrs. Bailey filed a claim with the City of Muskegon on July 26, 2021. Michigan Municipal Risk Management Authority known as MMRMA represents the City of Muskegon with its self-insurance program. We have negotiated a settlement agreement for the mitigation/clean-up of the property, and for damaged and lost property in the amount of $30,000. AMOUNT REQUESTED: $30,000 FUND OR ACCOUNT: Insurance Fund STAFF RECOMMENDATION: Approve $30,000 as final settlement of the claim for 1360 Eighth Street, for services and loss associated with the claim from July 24, 2021. I. Bridge Bundle #1 – Removal of Ottawa Bridge Public Works SUMMARY OF REQUEST: Staff is seeking formal resolution and support confirming concurrence for bridge removal of the Ottawa Street Bridge. Staff is seeking funds from the Michigan Department of Transportation (MDOT) Page 3 of 12 Bridge Bundle #1 program. MDOT piloted a Bridge Bundle program last year with the hopes of reducing the number of critical condition bridges by combining several bridges into one package. More information about the program and an online tracking tool can be found here: https://www.michigan.gov/som/0,4669,7-192-47796-564509--,00.html MDOT is seeking a formal resolution of commitment and support. Ottawa Street Bridge: This bridge only serves Richards Park and is already closed to traffic via concrete barriers. It is open to pedestrians. At this time, the city has no plans to replace the bridge. Staff is recommending a resolution of commitment and support to remove the Ottawa Street Bridge. STAFF RECOMMENDATION: Approve the Resolution of Commitment and Support for the Statewide Local Agency Bridge Bundle Program and authorize the Mayor and Clerk to sign. J. Sale – 434 Abbey Street Planning SUMMARY OF REQUEST: City staff is seeking authorization to sell the City owned vacant lot at 434 Abbey Street to James Williams. Mr. Williams would like to purchase the City owned buildable lot at 434 Abbey for $4,875 (75% of the True Cash Value of $6,500) plus half of the closing costs and the fee to register the deed. Mr. Williams will be constructing two (2) single- family homes on the property. STAFF RECOMMENDATION: Authorize the Code Coordinator to complete the sale of 434 Abbey Street as described in the purchase agreement and to have the Mayor and Clerk sign the deed. K. Approve the re-assignment of Building Contract for 769 Catawba Avenue CNS SUMMARY OF REQUEST: To re-award the Building Contract for the rehabilitation of 769 Catawba Avenue to Custom Exteriors, LLC – Mike Murphy, for the City of Muskegon’s Homebuyers Program. The Commission recently approved the rehabilitation contract of 769 Catawba Avenue to Nassau Construction LLC after the lowest bidder was unable to continue. Since that time the Lead Abatement work is near completion and ready for the rehabilitation process. I am requesting that the Rehabilitation Contract be re-awarded to the original contractor, Mike Murphy of Custom Exteriors, LLC. 1. Nassau Construction LLC is an abatement contractor for or LEAD Safe Muskegon Program with 3 current lead units to complete; 2. Custom Builders, LLC is requesting to fulfill its original obligation and ready to start; Page 4 of 12 3. Due to post-pandemic circumstances, CNS supports the re-assignment of this award to Custom Exteriors, LLC AMOUNT REQUESTED: $89,264.00 AMOUNT BUDGETED: $110,000 FUND OR ACCOUNT: HOME Program 2020 STAFF RECOMMENDATION: To award Custom Exteriors LLC the rehabilitation contract in the amount of $89,264.00, for the Community and Neighborhood Services Office Homebuyers Program. Motion by Commissioner Rinsema-Sybenga, second by Vice Mayor Hood, to accept the consent agenda as presented minus items, F, G, L, M, and N. ROLL VOTE: Ayes: Rinsema-Sybenga, Emory, Johnson, Gawron, Hood, and German Nays: None MOTION PASSES 2021-104 REMOVED FROM CONSENT AGENDA: F. Brownfield Development & Reimbursement Agreement, Viridian Land Shores Co, LLC (Viridian Shores at Harbor 31 Redevelopment Project), 150 Viridian Drive Economic Development SUMMARY OF REQUEST: Approval of the Brownfield Development and Reimbursement Agreement for the Viridian Land Shores Co, LLC (Viridian Shores at Harbor 31 Redevelopment Project) and to consider the resolution. The 3.5-acre property represents a portion of the former Teledyne Continental Motors industrial facility and would result in the construction of an approximately 63,000 square foot multi-story 118-unit senior living building with surrounding asphalt parking areas, concrete walkways and landscaping. The Brownfield Plan Amendment was approved by the Authority on May 11, 2021 and the City Commission on May 25, 2021. The Brownfield Plan is for a period of 22 years and includes Brownfield Eligible Activity costs estimated at $4,018,080. The property is within the DDA and it is anticipated that all taxes captured will go towards the Brownfield TIF during the life of the Plan. Eligible costs include due care, environmental response activities, demolition, asbestos abatement, site preparation, infrastructure improvements, Brownfield Plan preparation, administration costs, and interest expense (5%). The Development & Reimbursement Agreement outlines the procedures for the City to reimburse the Developer for eligible expenses with the Brownfield Plan. The Authority shall pay 100% of the available Brownfield TIF Revenue to the Developer to reimburse the costs of Developer Eligible Activities. The Developer will provide the BRA a request for payment of eligible expenses. The BRA has 30 days to approve the request. Payments are made on a semi-annual basis when Page 5 of 12 incremental local taxes are captured and available. The BRA approved this Agreement at its November 9, 2021 meeting. STAFF RECOMMENDATION: Approval of the Viridian Land Shores Co, LLC Brownfield Development and Reimbursement Agreement and authorize the Mayor and City Clerk to sign. ORIGINAL MOTION: Motion by Commissioner Johnson, second by Commissioner Rinsema-Sybenga, to approve the Viridian Land Shores Co, LLC Brownfield Development and Reimbursement Agreement and authorize the Mayor and City Clerk to sign. AMENDMENT: Motion by Commissioner Johnson, second by Vice Mayor Hood, to amend the motion to reflect a term expiring December 31, 2047. ROLL VOTE ON AMENDMENT: Ayes: Johnson, Gawron, Hood, German, Rinsema-Sybenga, and Emory Nays: None MOTION PASSES ROLL VOTE ON ORGINAL MOTION W/ AMENDMENT: Ayes: Emory, Johnson, Gawron, Hood, German, and Rinsema-Sybenga Nays: None MOTION PASSES G. Brownfield Development & Reimbursement Agreement, Ryerson Creek Land Co, LLC (Trilogy Senior Housing Redevelopment Project), 60 Viridian Drive Economic Development SUMMARY OF REQUEST: Approval of the Brownfield Development and Reimbursement Agreement for the Ryerson Creek Land Co, LLC (Trilogy Senior Housing Redevelopment Project) and to consider the resolution. The 5-acre property is the site of the former Teledyne Continental Motors industrial facility and would result in the construction of an approximately 63,000 square foot multi-story 118-unit senior living building with surrounding asphalt parking areas, concrete walkways and landscaping. The Brownfield Plan Amendment was approved by the BRA on October 12, 2021 and the Commission on October 26, 2021. The Brownfield Plan is for a period of 24 years and includes total Brownfield Eligible Activity costs estimated at $4,392,244. The property is within the DDA and it is anticipated that all taxes captured will go towards the Brownfield TIF during the life of the Plan. Eligible costs include due care, environmental response activities, demolition, site preparation, infrastructure improvements, Brownfield Plan preparation, administration costs, and interest expense (4%). Page 6 of 12 The Development & Reimbursement Agreement outlines the procedures for the City to reimburse the Developer for eligible expenses within the Brownfield Plan. The Authority shall pay 100% of the available Brownfield TIF Revenue to the Developer to reimburse the costs of Developer Eligible Activities. The Developer will provide the BRA a request for payment of eligible expenses. The BRA has 30 days to approve the request. Payments are made on a semi-annual basis when incremental local taxes are captured and available. The BRA approved this agreement at its November 9, 2021 meeting. STAFF RECOMMENDATION: Approval of the Ryerson Creek Land Co, LLC Brownfield Development and Reimbursement Agreement and authorize the Mayor and City Clerk to sign. ORIGINAL MOTION: Motion by Commissioner Johnson, second by Commissioner Rinsema-Sybenga, to approve Ryerson Creek Land Co, LLC Brownfield Development and Reimbursement Agreement and authorize the Mayor and City Clerk to sign. AMENDMENT: Motion by Commissioner Johnson, second by Vice Mayor Hood, to amend the motion to reflect a term expiring December 31, 2049. ROLL VOTE ON AMENDMENT: Ayes: Hood, German, Rinsema-Sybenga, Emory, Johnson, and Gawron Nays: None MOTION PASSES ROLL VOTE ON ORGINAL MOTION W/ AMENDMENT: Ayes: Gawron, Hood, German, Rinsema-Sybenga, Emory, and Johnson Nays: None MOTION PASSES L. 880 First Street Development and Purchase Agreement Development Services SUMMARY OF REQUEST: The team has been working with the developer at 880 First Street LLC to negotiate mutually favorable terms on a purchase and development agreement that will stipulate schedule of development and pricing for the city owned property and future expansion onto the City owned parking lot. The final draft is mutually agreed upon by staff and the developer. The structure of this development agreement has taken some time to negotiate due to an existing parking lease agreement with Parkland Properties that obligates the city to certain conditions it must maintain in the City owned lot behind the development site. The long-term phasing for this development, as described in previous presentations to the commission, includes a multi-story parking deck on that lot with liner apartments along Clay Street. This is set to Page 7 of 12 come after the renovation of and addition to the existing tower, but the parking structure would have to come along with the tower due to the lack of our ability to dedicate spaces in the existing parking lot. Due to the parking agreement and our obligations, there was a possibility that we would have to participate in a floor of that parking structure, at a cost of roughly a million dollars to the City. This was not favorable to us or the developer, so we in Development Services have been working on a concept to reorient parking on-street and introduce a permit system that would allow dedicated parking for permit holders in the phase 1 tower. In the packet, we have included a graphic that illustrates our ability to reorient the parking on this block that will provide additional spaces without impacting the lot, thereby allowing the parking structure to remain in phase 2 as intended and removing any need for the city to participate in a floor of the deck to meet our parking lease obligations. The proposed payment for the site is $400,000, and the Developer would buy out our eligible activities for a Brownfield TIF that we have already expended, such as the partial demolition and asbestos removal. They would then be able to add these to the Brownfield TIF plan amendment, but we get paid up front as opposed to sharing in the TIF to be repaid. Please note as a condition of closing, we are to enter into a separate parking agreement for the street parking, and to develop a permit parking ordinance. STAFF RECOMMENDATION: To accept the development agreement as presented and authorize the Mayor and Clerk to sign. Motion by Commissioner German, second by Commissioner Johnson, to accept the development agreement as presented and authorize the Mayor and Clerk to sign. ROLL VOTE: Ayes: German, Rinsema-Sybenga, Emory, Johnson, Gawron, and Hood Nays: None MOTION PASSES M. Project Capital Contributions City Manager SUMMARY OF REQUEST: Three ongoing transformational community projects have requested city financial commitments. Each of these projects have received substantial community support in addition to the support requested from the City. Staff is recommending that the city make financial commitments to the capital campaigns of the Boys and Girls Club, the Community Foundation for Muskegon County, and the Muskegon Museum of Art. The Boys and Girls Club (BGC) campaign will raise funds to convert the former YMCA and MCC Fitness Center into a year-round club. This renovated waterfront facility and ed programming will provide for a larger physical Page 8 of 12 activity space accessible to all City’s youth. They have raised $5.6 Million of their $7.5 Million budget. To assist in significantly narrowing the remaining financial gap, staff is recommending that $1 Million be committed to the Club for this transformational campaign. https://bgclubmuskegon.com/clubhouse The Muskegon Museum of Art is undergoing a capital campaign to expand the museum to include a new grand hall, two new galleries and more community space. Staff is recommending that $1 Million be committed to the Museum for this campaign. They have raised $9.85 Million in community support. Our $1 Million contribution will nearly complete the $11.5 Million project. More information is available here: https://muskegonartmuseum.org/shaping-the-future/ The Community Foundation for Muskegon County is undergoing a capital campaign to renovate the Frauenthal Center. The City has already committed funds to install heated sidewalks around the facility. Staff is recommending a total of $1 Million be committed to the Foundation, including funds already allocated to the heated sidewalk project. The Community Foundation has raised $4.8 Million of the total $6.1 Million budget. Based on our current interpretation of the interim final rule, all three projects qualify for assistance from the City’s ARPA allotment. Additionally, the expenses will be held until July 1, 2022 to allow for further guidance and for the city to complete collections of the second phase of ARPA and explore future funding opportunities from the State and Federal levels that could fund one or more of these commitments. The contributions are payable only if the ARPA funds can be utilized for the stated purpose. AMOUNT REQUESTED: $3 Million FUND OR ACCOUNT: 482: State Grants STAFF RECOMMENDATION: Approve the capital commitments as described and direct staff to budget the expenses from Fund 482 during FY 2022-23. Motion by Commissioner German, second by Commissioner Rinsema-Sybenga, to approve the capital commitments as described, and direct staff to budget expenses from Fund 482 during FY 2022-23. The contributions are payable only if the ARPA funds can be utilized for the stated purpose. ROLL VOTE: Ayes: German, Rinsema-Sybenga, Emory, Johnson, Gawron, and Hood Nays: None MOTION PASSES N. Environmental Work – Former Farmers Market Site City Manager SUMMARY OF REQUEST: Staff is seeking approval to hire Envirologic to provide environmental assessment and planning services at the former farmers market Page 9 of 12 site. The site was originally included in a city pilot program to build a mix of housing types to attract residents at various income levels. The original plans called for 53+ rental unites – some single-family structures and some multi-family structures. In an effort to meet the community’s goal of focusing on single family houses in lieu of duplexes and multiplexes, the proposed program has been scaled back to include a total of 21 single family houses and no duplexes or multiplexes. In January 2021, the City Commission authorized Soils and Structures to complete a soil assessment to determine the buildability of the site. The report is provided in the packet. The next step is to complete the environmental assessment. Envirologic is the City’s preferred contractor, as they have completed significant work on this site as part of the original FARM proposal. This work will be qualified for reimbursement in the scattered site brownfield program. AMOUNT REQUESTED: $22,000 FUND OR ACCOUNT: Brownfield STAFF RECOMMENDATION: Approve the expense of $22,000 to complete environmental assessment services at the former farmers market site. Motion by Commissioner Johnson, second by Commissioner Rinsema-Sybenga, to approve the expense of $22,000 to complete environmental assessment services at the former farmers market site. ROLL VOTE: Ayes: Rinsema-Sybenga, Emory, Johnson, Gawron, Hood, and German Nays: None MOTION PASSES 2021-105 UNFINISHED BUSINESS: A. Amendment to Lakeside Form Based Code – Marihuana Facilities Planning – 2ND READING SUMMARY OF REQUEST: Staff initiated request to amend the Lakeside Form Based Code to allow caregivers, microbusinesses, designated consumption establishments, class A recreational grows, class B recreational grows, class A medical grows and temporary marihuana events as a special use permitted in the Lakeside Commercial and Lakeside Heavy Commercial context areas. The Planning Commission’s motion to recommend approval of the request ended in a tie, with three Commissioners voting yes and three Commissioners voting no, with three Commissioners absent. Staff presented this idea to the City Commission at the September work session. STAFF RECOMMENDATION: To approve the request to amend the Lakeside Form Based Code to allow caregivers, microbusinesses, designated Page 10 of 12 consumption establishments, class A recreational grows, class B recreational grows, class A medical grows and temporary marihuana events as a special use permitted in the Lakeside Commercial and Lakeside Heavy Commercial context areas. Motion by Commissioner Johnson, second by Commissioner Rinsema-Sybenga, approve the request to amend the Lakeside Form Based Code to allow caregivers, microbusinesses, designated consumption establishments, class A recreational grows, class B recreational grows, class A medical grows and temporary marihuana events as a special use permitted in the Lakeside Commercial and Lakeside Heavy Commercial context areas. ROLL VOTE: Ayes: Johnson, Hood, German, and Rinsema-Sybenga Nays: Emory and Gawron MOTION PASSES 2021-106 NEW BUSINESS: A. 2022 POLC Contract City Manager SUMMARY OF REQUEST: Staff is seeking approval of the proposed collective bargaining agreement with the Police Officers Labor Council. City Staff and Police Officers labor Council representatives previously agreed upon new contract terms that would take effect January 1, 2022. Since that time, a number of small issues related to the original tentative agreement have been identified and subsequently reconciled. This is a formal request to approve the collective bargaining agreement. The POLC has already ratified the contract and city staff is prepared to begin enforcing the provisions of the contract on January 1, 2022. The new agreement is beneficial to both parties and is expected to help with police officer recruiting and retention; there is no financial impact on the budget as part of the new agreement. STAFF RECOMMENDATION: To approve the Collective Bargaining Agreement with the Police Officers Labor Council as presented. Motion by Commissioner German, second by Commissioner Emory, to approve the Collective Bargaining Agreement with the Police Officers Labor Council as presented. ROLL VOTE: Ayes: Johnson, Gawron, Hood, German, Rinsema-Sybenga, and Emory Nays: None MOTION PASSES B. 1183 Terrace Street – Purchase City Manager SUMMARY OF REQUEST: Staff is seeking approval to purchase the home at 1183 Page 11 of 12 Terrace Street from Francena DePung. This property was originally acquired from the Land Bank, and the owner has been unable to make the repairs necessary to save the home. Our on-staff builder reached out to the owner to inquire about purchasing the site. The home has significant historical appeal and we would like to save the structure as part of our infill housing program. The structure is vacant but has been used as a three-unit building. Staff would intend to convert it into either a two-unit or a single-family building. The renovation will likely take 12 months and cost between $275,000 and $350,000. Staff anticipates budgeting much of the renovation costs in FY 2022-23 but would like to replace the roof and address immediate concerns with the foundation. AMOUNT REQUESTED: $120,000 FUND OR ACCOUNT: Public Improvement STAFF RECOMMENDATION: Approve the purchase of 1183 Terrace Street from Francena DePung for $20,000 and amend the FY 2021-22 Public Improvement Fund Budget to include a total of $200,000 for the project during the fiscal year. Motion by Commissioner Rinsema-Sybenga, second by Vice Mayor Hood, to approve purchase of 1183 Terrace Street from Francena DePung for $20,000 and amend the FY 2021-22 Public Improvement Fund Budget to include a total of $200,000 for the project during the fiscal year. ROLL VOTE: Ayes: Gawron, Hood, German, Rinsema-Sybenga, Emory, and Johnson Nays: None MOTION PASSES ANY OTHER BUSINESS: Commissioner Emory asked DPW Director Leo Evans about the streetlight upgrades on the west side of the city. Commissioner German commended DPW on the Amity/Wood project and asked about street lighting near alleyways. City Manager Frank Peterson reminded everyone to keep porch lights on to increase neighborhood safety and that the winter parking rules will soon go into effect. PUBLIC COMMENT ON NON-AGENDA ITEMS: No public comments were received. ADJOURNMENT: The City Commission meeting adjourned at 7:35 p.m. Respectfully Submitted, Ann Marie Meisch, MMC – City Clerk Page 12 of 12
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