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Author Topic: One of the reasons Amtrak loses money
MontanaJim
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Because of the excessive lateness of many of its trains, Amtrak oftentimes has to provide accomodation or alternative transportation to many passengers.

For example, in 1994 I was on a tardy Empire Builder into Chicago. I was connecting to the Texas Eagle.

Amtrak paid for me an many others to fly from Chicago to St louis to catch our train.

Im sure that wasnt cheap for Amtrak.

Anyone else have a similar experience?

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jgart56
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There is some truth to your statement MontanaJim,
but sometimes things are out of Amtrak's control.

-if a freight derails and prevents their trains from getting through, Amtrak must make some decisions.....hotel room, alternate transportation, etc.

-if the host railroad continually puts Amtrak trains on the siding to favor their freights (UP and CSX come to mind here), Amtrak must make some decisions.....hotel room, alternate transportation, etc.

-if the weather is uncooperative (blizzard, hurricane, flooding), Amtrak must make some decisions.....hotel room, alternate transportation, etc.

-if the equipment fails, then yes, it is Amtrak's fault and they should do something about it.....hotel room, alternate transportation, etc.

There is much that can impact the running of their trains, and thus affect the bottom line. Yet it is often out of their control and then they have to do what they have to do.

My only and ongoing wish for Amtrak: "when a problem occurs, please tell your passengers what is going on! Regularly and with as much consideration as possible" I think that is the biggest and regular Amtrak failure!

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Tanner929
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Mountain Jim
How many of you had to make the connection? they flew you? would renting a bus or van? been cheaper. heck you might have been able to catch up with train before St Louis. I'm not sure where the airport is to the railstation in St Louis. Did they pay for your cab or bus between areas? Sounds like only a Government run and owned organization would due something so stupid? From Amtrak to FEMA its incompetence and wastefull. Any idea what the airline charged Amtrak? With all the subsidies in the airline industry did they get free tickets or did the airline charge the walk up fare and basically "double dip" Uncle Sam?

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notelvis
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I would submit that Amtrak is in better hands than was FEMA.......after all, Amtrak's CEO brings a full rail and transit industry resume to the table!

--------------------
David Pressley

Advocating for passenger trains since 1973!

Climbing toward 5,000 posts like the Southwest Chief ascending Raton Pass. Cautiously, not nearly as fast as in the old days, and hoping to avoid premature reroutes.

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MontanaJim
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"How many of you had to make the connection? they flew you? would renting a bus or van? been cheaper. heck you might have been able to catch up with train before St Louis. I'm not sure where the airport is to the railstation in St Louis. Did they pay for your cab or bus between areas? Sounds like only a Government run and owned organization would due something so stupid? From Amtrak to FEMA its incompetence and wastefull. Any idea what the airline charged Amtrak? With all the subsidies in the airline industry did they get free tickets or did the airline charge the walk up fare and basically "double dip" Uncle Sam?"
---------------------------

There were about 12 of us who were making the EB-Texas Eagle Connection. Amtrak gave us extra money (about 30 dollars each) to take a cab from the st louis airport to the train station (about 10 miles). (We were all bussed in chicago to midway airport). but we got together and shared cabs and each pocketed about 20 bucks.

I dont know how much the airline charged amtrak.

Our train was really late that day and im sure the other passengers going elsewhere were provided with something as well. When the EB arrived in Chicago everyone was told to go to a room and there they told each passenger what was going to happen. I was shocked when they told me they were going to fly me to St Louis....

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MontanaJim
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i wonder if the railroads have to reimburse amtrak for passengers accomodation, etc if it was the fault of the freight RR?
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jgart56
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i wonder if the railroads have to reimburse amtrak for passengers accomodation, etc if it was the fault of the freight RR?
__________________________________________________

I sincerely, doubt that MontanaJim. The railroads get some sort of bonus from Amtrak if they run their trains on time. UP and CSX must consider (this money) small potatoes since they don't seem to worry about it. While BNSF does make an effort to collect. It must have something to do with corporate philosophy as to whether to make an effort or not.

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Mr. Toy
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quote:
Originally posted by MontanaJim:
i wonder if the railroads have to reimburse amtrak for passengers accomodation, etc if it was the fault of the freight RR?

It is my understanding that they don't, at least not directly.

jgart56 points out that Amtrak makes incentive payments for on time trains. It should also be noted that Amtrak also collects penalty payments from the freight railroads for late trains. I would imagine that those penalties cover a fair chunk of the alternate transportation costs, if not all.

Might note that if the host railroads ran every train on time, the incentive payments would actually exceed the basic costs Amtrak pays for access. In other words, the host railroads would more than double their income from Amtrak if they ran all the trains on time.

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St. Louis rail fan
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Well, I guess the bottom line is, if you travel via Amtrak you better be sure to have plenty of time on your hands. Ok, that said I would just like to point out something. Isn't it a shame that the Federal government is always on Amtraks case because they aren't profitable. Why are they expected to be profitable? If that's the case why isn't the interstate highway system expected to be also? Million of dollars get poured into that every year and there's not a cent of profit. At least Amtraks generates a few bucks.
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notelvis
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quote:
Originally posted by St. Louis rail fan:
Well, I guess the bottom line is, if you travel via Amtrak you better be sure to have plenty of time on your hands. Ok, that said I would just like to point out something. Isn't it a shame that the Federal government is always on Amtraks case because they aren't profitable. Why are they expected to be profitable? If that's the case why isn't the interstate highway system expected to be also? Million of dollars get poured into that every year and there's not a cent of profit. At least Amtraks generates a few bucks.

Been awhile since any major airline posted a profit as well.....in spite of a lifetime of hidden subsidies coupled with outright federal bailouts.

--------------------
David Pressley

Advocating for passenger trains since 1973!

Climbing toward 5,000 posts like the Southwest Chief ascending Raton Pass. Cautiously, not nearly as fast as in the old days, and hoping to avoid premature reroutes.

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Tanner929
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Much of the problem with the National Train System is that when traveling by train you are at the "mercy" of the trains. I'm not just talking about train delays but its about schedules. Reading this forum it looks to me most train trips are done on extended vacations. I think the only way Train Service will be viable is if the High Speed or at least the LD's have there on delegated tracks.
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Gilbert B Norman
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At this time, Mr. Pressley, Sixth largest Southwest and Eleventh largest Jet Blue are profitable.

http://www.nytimes.com/2005/10/21/business/21air.html

However, there is much to suggest that the only reason Southwest remains profitable is because thay have some savvy commodities traders in their corner, rather than strictly speaking from flight operations:

http://www.nytimes.com/2005/10/16/business/16southwest.html

However, I think it is a safe statement that the air transport industry has not made a $$$ since Kitty Hawk.

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jgart56
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Tanner929,

Who exactly is going to pay for the dedicated tracks? Amtrak gets barely enough to keep it going. The freight railroads are certainly not going to pay for extra trackage, and the states are certainly not going to pick up the tab. In fact, most railroads cut capacity in the 80's...IC comes to mind here...they used to have a marvelous 2 track main from Chicago all the way to New Orleans. Now it's one track with occasional long passing sidings. They could certainly use the 2 track capacity now.

Also, how many billions in loans and grants were given to the Airlines after 911? And do you think our Federal Government will ever demand the loans back in a timely manner? I doubt it...the general favoritism towards air and road vs. railroad still exists. We'll back up a money losing airline like United, and then turn around and starve Amtrak, when it could be a great help to the traveling public

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notelvis
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quote:
Originally posted by Gilbert B Norman:
At this time, Mr. Pressley, Sixth largest Southwest and Eleventh largest Jet Blue are profitable.

Point taken Mr. Norman and thanks for the links.

For whatever reason I don't yet consider Southwest a major airline even though I realize that they are. (Maybe it's because one can't book Southwest through Expedia?)

I've used Southwest a number of times to whisk me out of either Raleigh or Nashville (home is almost at exactly the midpoint between these two) and on to someplace where I can catch a train!

--------------------
David Pressley

Advocating for passenger trains since 1973!

Climbing toward 5,000 posts like the Southwest Chief ascending Raton Pass. Cautiously, not nearly as fast as in the old days, and hoping to avoid premature reroutes.

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George Harris
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quote:
Originally posted by jgart56:
most railroads cut capacity in the 80's...IC comes to mind here...they used to have a marvelous 2 track main from Chicago all the way to New Orleans. Now it's one track with occasional long passing sidings. They could certainly use the 2 track capacity now.

Actually, IC is a rather interesting and very sad story: Firstly they were not actually double track all the way. They were double track Chicago to Memphis and then Jackson MS to New Orleans. Between Memphis and Jackson, they had two parallel lines, the Grenada District more or less parallel to I-55 was the passenger main with very little freight traffic and the Yazoo District through Yazoo City, slightly longer but much flatter, was the freight main. The second track was removed between Hammond LA and Kenner LA sometime in the 50's. The second track between Cairo IL and Fulton KY was removed in about 1961. It may have been removed to as far north as Carbondale IL somewhere in here as well, because most freight moved via the Edgewood Cutoff between just south of Centralia IL and Fulton. By the early 80's the Grenada District was suffering from years of neglect. It was mostly in 112 lb jointed rail that was so worn the tops of the joint bars were shiny from wheel flange contact. In the late 80's the railroad was sold off, and the new owners covered part of their purchase price by single tracking the rest of the railroad and selling off the materials. At the same time the ATC or ATS or whatever system they had in Illinois was removed so all the 90 mph territory became 79 mph. Even the 90 was a reduction from the 100 mph limit still in place for this section into the 1960's. As a result of this policy, the best rails they owned were SOLD, not installed in other tracks to upgrade them. Somewhere in here, Amtrak was moved to the Yazoo district and the Grenada district downgraded. I believe the signals are gone and parts are up for abandonment.

A lot of this is a result of the development of "IC Industries" years ago and diversification resulting in the managmetn forgetting they were supposed to be running a railroad.

George

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jgart56
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Thanks for correcting me George,

I do recall riding the City of New Orleans in the late 80's and watching a work train rip up sections of the double track near New Orleans. I could still see the place where the second track used to be, last year, when my wife and I traveled to the Big Easy.

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Tanner929
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Never could figure the sense of tearing up the second track I understand about maitenence and upkeep but now one track is being used twice as much. What did they do with land they sold that had the 2nd track on? I'm sure the loss of efficiency and productivity has never been gained by the maitenence of the 2nd track, or at least add more passing siddings.
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Mr. Toy
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Tanner, I suspect one reason why railroads ripped up second tracks is that it reduced the assessed value of the right-of-way for property tax purposes.

--------------------
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espeefoamer
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And the number 1 reason Amtrak trains are late...UNION PACIFIC [Mad] !

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George Harris
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There is no land left over to be sold when a second track is removed, unless they happen to be on different alignments, which is usually not the case. (Yes, I do know of several cases where they are, but it is a very small percentage of the whole.) When it is simply parallel, the land uncovered is a strip 13 feet to 14 feet wide, depending upon track centers. The ditches anc cut and fill slopes stay the same as they were. Sometimes the superstructure of the bridges under the second track is removed, sometimes not. When there is a single set of girders or trusses supporting both tracks, then obviously no part of the bridge can be removed except the bridge ties, and even these are usually left in place.

Mr. Toy is quite right. Taxes are a big reason for removing tracks that you can live without. Property taxes are based on assessed valuation of the property, and for a railroad, the value of the track materials is a big chunk of the value. Supposedly taxes were a big factor in SP/UP's decision to shut down the Pheonix line. I would also suspect that the Pheonix line was on the verge of needing a lot of work to keep it from falling below the 60 mph passenger standard it had.

Another reason to take up a second track is that it gives a one-time reduction in the need to by new track materials because the track material taken out can be reused. Then there was the IC situation where the new owners turned it into cash.

Rail life is usually directly related to gross tonnage carried. Ties partly wear out and partly rot out. Tamping is also primarily traffic carried related. Ditching and right of way maintenance expenses are usually independent of traffic carried, and alos number of tracks between them. Road crossing maintenance is primarily a function of the volume of road traffic, so there is real savings there by ruducing a crossing from two tracks to one.

Of course costs related to train delays go up with single tracking. Also maintenance costs per unit of work go up if the work crews spend a lot of time watching trains go by. Therefore, there is a sag point in the cost curve where the reduction maintenance cost of the track is overcome by increased operation costs. As a business, this is the traffic volume below which you take out the second track and above which you leave it in. The catch is, once the track is out, the cost savings must be much higher to justify its restoration.

George

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JONATHON
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"resones Amtrak loses money?" heres one:

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Mike Smith
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Johnathon, that's OK. When you are young and dumb, you're supposed to act young and dumb. In a year or two, when you have US Government in school, please pay attention, so you can learn how our government works.

BTW, did you know that HUD loses more money than Amtrak gets each year? And by lose, I really mean lost the money. They don't know where it went.

However, you still need to work on your spelling... Or do they still teach that in school?

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MontanaJim
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Good point Jonathon!
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JONATHON
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quote:
Originally posted by mikesmith:
Johnathon, that's OK. When you are young and dumb, you're supposed to act young and dumb. In a year or two, when you have US Government in school, please pay attention, so you can learn how our government works.

BTW, did you know that HUD loses more money than Amtrak gets each year? And by lose, I really mean lost the money. They don't know where it went.

However, you still need to work on your spelling... Or do they still teach that in school?

I am who I am, Like it or Love it.

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Mike Smith
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Johnathan, there was no animosity or mean-spirited intent in my post. In fact, there is nothing there that I didn't tell my kids when they were your age. It was meant as an informational post, only.

And bashing Bush is a national passtime for the young people {physically and mentally young} of this Nation, so it is not surprising that "young" people, such as yourself, bash him.

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JONATHON
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quote:
Originally posted by mikesmith:
Johnathan, there was no animosity or mean-spirited intent in my post. In fact, there is nothing there that I didn't tell my kids when they were your age. It was meant as an informational post, only.

And bashing Bush is a national passtime for the young people {physically and mentally young} of this Nation, so it is not surprising that "young" people, such as yourself, bash him.

oh- ok [Smile]

.

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4021North
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Who ever said Amtrak was supposed to make money anyway? If I recall, when Amtrak was set up around 1970 their mission was to operate a national railroad passenger service. The "self-sufficiency" idea which came to the forefront around 1997 seems to have been used recently to mislead people into thinking passenger trains have to make a profit. It's rather ironic how passenger rail, which is among the more efficient and economical modes of transportation, is being called a waste of money. I hope we will consider these things in forming our political opinions.
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MontanaJim
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well there is a difference between making money and spending wastefully and losing excessive amounts of it.......
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CG96
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When Amtrak was created, one of the methods by which the rail service was "sold" to our elected representatives at the time was that it would be profitable. IIRC, the "profitability" language remained in the Amtrak authorization legislation until the early 1980s, when Reagan Administration Budget Director Dave Stockman made every effort to eliminate funding for Amtrak. It was only through the efforts of "we, the people," who contacted our elected representatives and told them "Don't eliminate Amtrak - No way!"

There is a flip side to the argument, as Amtrak has done severla things over the years that were penny-wise and pound foolish, like trying to cut the way towards growth, and putting microwave meals in the diners when passengers instead wanted something more conventional (note I didn't say extravagant).

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4021North
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>IIRC, the "profitability" language remained in the Amtrak authorization legislation until the early 1980s

You're probably right. I would be curious to see the passages about profitability in the authorization. I'll concede that the most desirable trains economically would likely be the profitable ones; however, given what's been pointed out earlier in this thread about the non-profitability of highways and aviation, trains shouldn't be required to be profitable in order to exist.

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Tanner929
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What administration did the trains run on time? Oh yeah the Mussolini administration.
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jgart56
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Although I cannot remember the amount, I believe the highly touted Reauthorization Act of 1997 did say that Amtrak had to be self-sufficient within 5 years. However, and many media writers fail to point this out, the Congress did promise to fully fund Amtrak and also provide it with capital funds. None of which happened. On a yearly basis, funds were cut and capital never provided...but still, Amtrak was expected to make a profit.

It would be like you or I hired for a $50,000 a year job and then be told on the first day, oh yeah, we can only pay you $30,000 this year but you will be required to do all the work in your contract for the same amount.

I used this analogy with my Congressional Rep (Dennis Hastert) earlier this year and he actually agreed that there was a problem with how Amtrak was funded in that 5 year period. He also stated that he supported Amtrak.

There is a difference, however, between supporting and actually voting to provide the monies!

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George Harris
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A lot of these clowns in congress need to be reminded of the old saying, "Put your money where your mouth is."
Posts: 2808 | From: Olive Branch MS | Registered: Nov 2002  |  IP: Logged | Report this post to a Moderator
Tanner929
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Although I cannot remember the amount, I believe the highly touted Reauthorization Act of 1997 did say that Amtrak had to be self-sufficient within 5 years. However, and many media writers fail to point this out, the Congress did promise to fully fund Amtrak and also provide it with capital funds. None of which happened. On a yearly basis, funds were cut and capital never provided...but still, Amtrak was expected to make a profit.
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How many 5 year plans did it take the Soviet Union to crumble?

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Mr. Toy
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As I understand it, the 1997 act mandated operational self sufficiency. After 2002 Amtrak wasn't supposed to receive any operating subsidies, but Congress was still obligated to provide capital indefinitely. During that 5 year period, Congress was supposed to provide a specific amount of capital in order for Amtrak to expand its fleet (and thus its sales potential), but only half of it was actually appropriated. Then Amtrak sunk that into Acela, under the mistaken notion that it would be so successful it would "cross subsidize" the rest of the national system.

Plenty of mistakes were made by just about everyone involved.

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jgart56
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I don't know how many 5 year plans it took the Soviet Union to crumble, however, I do think the "Warrington years" were an unmitigated disaster as far as the Management of Amtrak was concerned. A highly trumpted expansion plan which came to naught, passenger trains started because of possible freight revenue, pursuing freight that forced trains to be late when adding subtracting mail/frieght cars, employee morale going down the tubes, etc. etc.

An interesting read into recent Amtrak history is an article in the November Trains magazine about the recruitment and arrival of David Gunn as the new CEO. I recommend it!

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