[Federal Register: February 7, 2003 (Volume 68, Number 26)]
[Rules and Regulations]
[Page 6355-6359]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07fe03-9]
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DEPARTMENT OF ENERGY
48 CFR Parts 923, 936 and 970
RIN 1991-AB47
Acquisition Regulation: Affirmative Procurement Program--
Acquisition of Products Containing Recovered Materials
AGENCY: Department of Energy.
ACTION: Final rule.
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SUMMARY: The Department of Energy (DOE) is amending the Department of
Energy Acquisition Regulation (DEAR) to further implement Executive
Order 13101, Greening the Government Through Waste Prevention,
Recycling, and Federal Acquisition, dated September 14, 1998. On June
6, 2000, the Federal Acquisition Regulation (FAR) was amended to
implement the Executive Order by a final rule published in the Federal
Register. Today's amendment to the DEAR is necessary to supplement the
FAR regarding agency policy applicable to DOE's facility management
contractors.
EFFECTIVE DATE: March 10, 2003.
FOR FURTHER INFORMATION CONTACT: Richard Langston, U.S. Department of
Energy, Office of Procurement and Assistance Management, ME-61, 1000
Independence Avenue, SW., Washington, DC 20585 at (202) 586-8247, or
via e-mail at richard.langston@pr.doe.gov.
SUPPLEMENTARY INFORMATION:
I. Background
II. Discussion of Public Comments
III. Section-by-Section Analysis
IV. Procedural Requirements
A. Review Under Executive Order 12866
B. Review Under Executive Order 12988
C. Review Under the Regulatory Flexibility Act
D. Review Under the Paperwork Reduction Act
E. Review Under the National Environmental Policy Act
F. Review Under Executive Order 13132
G. Review Under the Unfunded Mandates Reform Act of 1995
H. Review Under the Treasury and General Government
Appropriations Act, 1999
I. Review Under the Small Business Regulatory Enforcement
Fairness Act of 1996
J. Review Under Executive Order 13211
K. Approval by the Office of the Secretary of Energy
I. Background
This action follows a Notice of Proposed Rulemaking published in
the Federal Register on November 30, 2000 (65 FR 71292). The public
comment period for the notice ended January 2, 2001. The purpose of
this rule is to provide additional guidance regarding Executive Order
13101, dated September 14, 1998 (63 FR 49641), entitled Greening the
Government Through Waste Prevention, Recycling, and Federal
Acquisition, which superceded Executive Order 12873 dated October 20,
1993, entitled Federal Acquisition, Recycling, and Waste Prevention.
Among the changes made by this rule is the revision of the clause at
section 970.5223-2 of the DEAR to
[[Page 6356]]
include subcontract flow down of Affirmative Procurement Program
requirements in certain limited circumstances.
Subsequent to the publication of the Notice of Proposed Rulemaking,
a separate final rule was published December 22, 2000, 65 FR 80994,
amending the DEAR. That final rule amended the numbering structure of
Part 970, Management and Operating Contracts. As a result of that final
rule, the clause at 970.5204-39 in the proposed rule was redesignated
970.5223-2.
II. Discussion of Public Comments
Five organizations submitted comments in 9 areas as discussed
below.
1. 923.405, Procedures [DOE supplemental coverage--paragraph (e)].
The Department had proposed that the percentage of recovered/recycled
content, recommended by the Environmental Protection Agency (EPA) in
their Recovered Materials Advisory Notices (RMANs) be specified in the
solicitation as the minimum percentage of recycled content.
Comment: One reviewer suggested that this created a problem as the
EPA RMANs often do not specify a specific content but rather a range of
content as the content sometimes varies by geographical area.
Response: The Department agrees with this comment and has added the
phrase ``or range of content'' at 923.405(e).
2. 923.705, Contract clause, specifies the use of the clause at FAR
52.223-10.
Comment: A reviewer did not believe the meaning of the phrase
``prime support service awards being performed at Government-owned or
Government-leased facilities'' was clear. The same reviewer suggested
the word ``awards'' was unnecessary in the same phrase.
Response: The Department has chosen not to finalize proposed
section 923.705 because it would be unnecessarily duplicative of
existing FAR coverage at 23.705.
3. 936.601-3, Applicable contract procedures. The Department had
proposed to add a new Section 936.601 addressing topics that
requirements personnel should consider when designing and constructing
or modifying facilities. No comments were received but the Department
has chosen to delete the addition of a section 936.601-3 from this rule
as it is unnecessarily duplicative of existing FAR coverage at 36.601-
3.
4. 970.5223-2, Affirmative Procurement Program. The rule would
extend the Affirmative Procurement Program to certain subcontracts.
Comment: A reviewer suggested that flow down would be contrary to
other DOE efforts to implement more economical and efficient commercial
procurement practices. The reviewer suggested this would entail
substantial cost to implement on the part of subcontractors who would
have to develop additional compliance procedures, including an
inspection program.
Response: The Department disagrees. The Resource Conservation and
Recovery Act of 1976, 42 U.S.C. 6962, as amended, and EPA regulations,
found at 40 CFR part 247, require Federal agencies to acquire products
with recovered/recycled content which have been designated by EPA in
the Comprehensive Procurement Guidelines. Executive Order 13101,
Greening the Government Through Waste Prevention, Recycling, and
Federal Acquisition, Section 701, requires contracts for contractor
operation of a Government-owned or Government-leased facility to
include provisions that obligate the contractor to comply with the
requirements of the Executive Order. The result of the statute, EPA
regulations, and the Executive Order are that this portion of the
operation of a Federal facility cannot be operated as though it were a
commercial facility. Disregarding these requirements when a
subcontractor operates a portion of a Government facility would be
contrary to the intent of the requirements. The purpose of this
rulemaking is not to flow down the Affirmative Procurement Program to
all subcontracts. The purpose of the rulemaking is to capture those
instances in which a facility management contractor subcontracts for a
significant portion of the operation of the Government facility which
involves acquisition of items designated in EPA's Comprehensive
Procurement Guidelines that Federal agencies and their contractors are
to acquire with recovered/recycled content. The flow down applies only
to such subcontracts not to all subcontracts. The reviewer is concerned
that our flow down in this limited area will include extensive
certifications or inspections. The Department has chosen not to flow
down this level of detailed guidance. The contractor and subcontractor
may agree on what degree of detail is appropriate to the circumstance.
No inspection programs are contemplated or mandated by this rulemaking.
5. 970.5223-2, Affirmative Procurement Program. The Department had
proposed changing the clause title from ``Acquisition and Use of
Environmentally Preferable Products and Services'' to ``Affirmative
Procurement Program.''
Comment: A reviewer asked the origin of the title of the clause.
The same reviewer suggested we add ``for EPA Designated Products.''
Another reviewer suggested ``environmentally preferable'' should be
retained in the title as the program guidance materials address this
topic.
Response: The title ``Affirmative Procurement Program'' is the
title used by the Resource Conservation and Recovery Act, 42 U.S.C.
6962, to describe a preference program for Federal acquisition of
products with recovered/recycled content. The DOE Affirmative
Procurement Program Guidance materials do include consideration of
environmentally preferable aspects of procurement; however, the primary
focus of the program is products with recycled content. Environmentally
preferable procurement is generally viewed as a separate program area
which seeks to acquire products and services that have a lesser or
reduced effect on human health and the environment when compared with
competing products or services that serve the same purpose.
Accordingly, the Department is not accepting the suggestion that we
retain''environmentally preferable'' in the title. The suggestion that
we add ``for EPA designated products'' is not adopted as the Department
prefers the shorter title.
6. 970.5223, Affirmative Procurement Program. Paragraph (a) advises
the reader that the Department's Affirmative Procurement Program
Guidance is available on the Internet.
Comment: Two reviewers questioned the meaning of this. They were
concerned that posting the guidance on the Internet would allow the
Government to revise the Guidance without notice.
Response: The guidance provided at the DOE Executive Order 13101
home page is extensive and includes Federal, EPA and DOE regulatory
materials, Executive Orders, strategic plans, and related information.
The specific portion considered to be the DOE Affirmative Procurement
Program Guidance, for purposes of compliance with the clause at
970.5223-2, is entitled DOE's Affirmative Procurement Program Guidance.
It was developed after extensive coordination within the Department. It
is the same guidance referred to in current contracts and it is posted
on the Internet only for the convenience of all. Any changes will be
coordinated within the Department.
[[Page 6357]]
Posting the Guidance on the Internet is only for the convenience of all
parties and will have no effect on the formal means through which
revisions may be made.
7. 970.5223-2, Affirmative Procurement Program. Paragraph (c)
addresses submission of contract reports.
Comment: A reviewer suggested that the requirement for the
submission of subcontract reports at the ``conclusion of each fiscal
year'' would be problematic for supply item subcontracts in particular
since a set delivery date generally would not cross fiscal years. The
reviewer suggested that it be revised to read ``at the end of the
Federal fiscal year and the end of the contract.''
Response: The intent of this suggestion has been adopted but the
text has been included at paragraph (d) for clarity since paragraph (d)
addresses subcontract matters. The added text allows submission of the
report upon completion of the subcontract unless the subcontract term
is multiple year, in which case it provides that the parties will agree
to an annual report submission schedule.
8. 970.5223-2, Affirmative Procurement Program. Paragraph (d)
addresses applicability to subcontracts.
Comment: A reviewer suggested that the facility management
contractor be allowed to flow down a clause substantially the same as
that at 970.5223-2. The reviewer suggested it might be easier to
accomplish the intent of the instruction if it is possible to tailor
the clause to the circumstances of the subcontract situation. The
reviewer also suggested that there was no reason to flow down the
clause if the parties can determine the amount of products with
recycled content that will be acquired under the subcontract at the
time of the subcontract award.
Response: The Department agrees. The instructions, at 970.2304-2,
and in paragraph (d) of the clause, have been revised to allow use of a
clause substantially the same as the 970.5223-2 clause. Additionally,
the instructions, at 970.2304-2, and in paragraph (d) of the clause,
have been revised to provide that in situations in which the facility
management contractor can reasonably determine the amount of products
with recovered/recycled content that will be acquired under the
subcontract, the facility management contractor may include such
quantities in its own report and only flow down a requirement that the
subcontractor will procure such products with recovered/recycled
content. When it is not possible to determine the amount to be acquired
under the subcontract, such as an ``as required'' supply or service
subcontract, the clause should be included in the subcontract.
9. 970.5223-2, Affirmative Procurement Program. Paragraph (e)
concerns terminology to be used when the clause is used in a
subcontract.
Comment: A reviewer questioned whether all facility management
contractors have a recycling coordinator.
Response: Yes, all DOE facility management contractors have a
recycling coordinator.
III. Section-by-Section Analysis
The Department of Energy amends the regulation as follows:
1. The authority citation for Parts 923 and 936 is revised.
2. A new section 923.405, Procedures, is being added to note that
the recommended percentage of recycled content or range of recycled
content included in the EPA Recovered Materials Advisory Notices
(RMANs) is to be specified in the solicitation and contract as the
minimum recycled content or range of content.
3. Section 923.471, Policy, is being deleted as unnecessarily
duplicative of FAR coverage at 23.403.
4. Section 936.602-70 is modified by the addition of a new
paragraph (a)(8) regarding consideration of the Architect-Engineer
firm's experience in energy efficiency, pollution prevention, waste
reduction, and the use of recovered and environmentally preferable
materials when performing Architect-Engineer evaluations.
5. Section 970.2304 is being updated to include reference to 48 CFR
(FAR) 23.4 and 23.704 and is revised to provide guidance concerning
circumstances under which the clause at 970.5223-2 should be included
in subcontracts. The list of circumstances under which recycled content
products need not be purchased is revised to conform to the wording of
the Federal Acquisition Regulation.
6. The clause at 970.5223-2 is being updated and revised to include
guidance concerning circumstances under which the clause should be
included in certain subcontracts. The list of circumstances under which
recycled content products need not be purchased is revised to conform
to the wording of the Federal Acquisition Regulation.
IV. Procedural Requirements
A. Review Under Executive Order 12866
Today's regulatory action has been determined not to be a
``significant regulatory action'' under Executive Order 12866,
``Regulatory Planning and Review'' (58 FR 51735, October 4, 1993).
Accordingly, this rule is not subject to review under that Executive
Order by the Office of Information and Regulatory Affairs of the Office
of Management and Budget (OMB).
B. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on
Executive agencies the general duty to adhere to the following
requirements: (1) Eliminate drafting errors and ambiguity; (2) write
regulations to minimize litigation; and (3) provide a clear legal
standard for affected conduct rather than a general standard and
promote simplification and burden reduction. With regard to the review
required by section 3(a), section 3(b) of Executive Order 12988
specifically requires that Executive agencies make every reasonable
effort to ensure that the regulation: (1) Clearly specifies the
preemptive effect, if any; (2) clearly specifies any effect on existing
Federal law or regulation; (3) provides a clear legal standard for
affected conduct while promoting simplification and burden reduction;
(4) specifies the retroactive effect, if any; (5) adequately defines
key terms; and (6) addresses other important issues affecting clarity
and general draftsmanship under any guidelines issued by the Attorney
General. Section 3(c) of Executive Order 12988 requires Executive
agencies to review regulations in light of applicable standards in
section 3(a) and section 3(b) to determine whether they are met or it
is unreasonable to meet one or more of them. DOE has completed the
required review and determined that, to the extent permitted by law,
this final rule meets the relevant standards of Executive Order 12988.
C. Review Under the Regulatory Flexibility Act
This final rule has been reviewed under the Regulatory Flexibility
Act, 5 U.S.C. 601 et seq., which requires preparation of an initial
regulatory flexibility analysis for any role that is likely to have
significant economic impact on a substantial number of small entities.
This rule, which would implement provisions of Executive Order 13101
concerning the use of recycled materials, would not have a significant
economic impact on small entities. While rule requirements may flow
down to subcontractors in certain
[[Page 6358]]
circumstances, the costs of compliance are not estimated to be large
and, in any event, would be reimbursable expenses under the contract or
subcontract.
Accordingly, DOE certifies that this rule would not have a
significant economic impact on a substantial number of small entities,
and, therefore, no regulatory flexibility analysis has been prepared.
D. Review Under the Paperwork Reduction Act
Information collection or record keeping requirements contained in
this rulemaking have been previously cleared under Office of Management
and Budget paperwork clearance package Number 1910-0300. There are no
new burdens imposed by this rule.
E. Review Under the National Environmental Policy Act
DOE has concluded that promulgation of this rule falls into a class
of actions which would not individually or cumulatively have
significant impact on the human environment, as determined by DOE's
regulations (10 CFR part 1021, subpart D) implementing the National
Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.).
Specifically, this rule is categorically excluded from NEPA review
because the amendments to the DEAR would be strictly procedural
(categorical exclusion A6). Therefore, this rule does not require an
environmental impact statement or environmental assessment pursuant to
NEPA.
F. Review Under Executive Order 13132
Executive Order 13132 (64 FR 43255, August 4, 1999) imposes certain
requirements on agencies formulating and implementing policies or
regulations that preempt State law or that have federalism
implications. Agencies are required to examine the constitutional and
statutory authority supporting any action that would limit the
policymaking discretion of the States and carefully assess the
necessity for such actions. DOE has examined today's rule and has
determined that it does not preempt State law and does not have a
substantial direct effect on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government. No further
action is required by Executive Order 13132
G. Review Under the Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each agency to assess the effects of Federal regulatory
action on State, local and tribal governments, and the private sector.
The Department has determined that today's regulatory action does not
impose a Federal mandate on State, local or tribal governments or on
the private Sector.
H. Review Under the Treasury and General Government Appropriations Act,
1999
Section 654 of the Treasury and General Government Appropriations
Act, 1999 (Pub. L. 105-277), requires Federal agencies to issue a
Family Policymaking Assessment for any rule or policy that may affect
family well-being. This rulemaking will have no impact on family well-
being.
I. Review Under the Small Business Regulatory Enforcement Fairness Act
of 1996
As required by 5 U.S.C. 801, the Department of Energy will report
to Congress promulgation of this rule prior to its effective date. The
report will state that it has been determined that the rule is not a
``major rule'' as defined by 5 U.S.C. 804(3).
J. Review Under Executive Order 13211
Executive Order 13211, Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use, (66 FR 28355,
May 22, 2001) requires Federal agencies to prepare and submit to the
Office of Information and Regulatory Affairs (OIRA), Office of
Management and Budget, a Statement of Energy Effects for any proposed
significant energy action. A ``significant energy action'' is defined
as any action by an agency that promulgates or is expected to lead to
promulgation of a final rule, and that: (1) Is a significant regulatory
action under Executive Order 12866, or any successor order; and (2) is
likely to have a significant adverse effect on the supply,
distribution, or use of energy, or (3) is designated by the
Administrator of OIRA as a significant energy action. For any proposed
significant energy action, the agency must give a detailed statement of
any adverse effects on energy supply, distribution, or use should the
proposal be implemented, and of reasonable alternatives to the action
and their expected benefits on energy supply, distribution, and use.
Today's rule is not a significant energy action. Accordingly, DOE
has not prepared a Statement of Energy Effects.
K. Approval by the Office of the Secretary of Energy
Issuance of this final rule has been approved by the Office of the
Secretary of Energy.
List of Subjects in 48 CFR Parts 923, 936 and 970
Government procurement.
Issued in Washington, DC, on January 28, 2003.
Richard H. Hopf,
Director, Office of Procurement and Assistance Management, Office of
Management, Budget and Evaluation, Department of Energy.
Robert C. Braden, Jr.,
Director, Office of Procurement and Assistance Management, National
Nuclear Security Administration.
For the reasons set out in the preamble, DOE amends Chapter 9 of
Title 48 of the Code of Federal Regulations as set forth below.
1. The authority citations for Parts 923 and 936 are revised to
read as follows:
Authority: 42 U.S.C. 7101 et seq.; 41 U.S.C. 418b; 50 U.S.C.
2401 et seq.
PART 923--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-
FREE WORKPLACE
2. Section 923.405 is added to read as follows:
923.405 Procedures [DOE supplemental coverage--paragraph (e)].
(e) When acquiring items designated in the EPA Comprehensive
Procurement Guidelines, the EPA recommended percentage of recovered/
recycled content or range of content contained in the Recovered
Materials Advisory Notice (RMAN) shall be specified in the solicitation
and contract as the minimum percentage of recovered/recycled content or
range of content. Acquisition of a product with recycled content
exceeding the RMAN recommended content or range of content is
encouraged if the product performs acceptably.
923.471 [Removed and Reserved].
3. Section 923.471 is removed and reserved.
PART 936--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS
4. Section 936.602-70 is amended by adding paragraph (a)(8) to read
as follows:
936.602-70 DOE selection criteria.
* * * * *
(a) * * *
[[Page 6359]]
(8) In addition to these requirements, consider the Architect-
Engineer firm's experience in energy efficiency, pollution prevention,
waste reduction, and the use of recovered and environmentally
preferable materials and other criteria at FAR 36.602-1.
* * * * *
PART 970--MANAGEMENT AND OPERATING CONTRACTS
5. The authority citation for Part 970 continues to read as
follows:
Authority: 42 U.S.C. 2201; 42 U.S.C. 7101, et seq.; 50 U.S.C.
2401 et seq.
6. The subpart title for subpart 970.23 is revised to read as
follows:
Subpart 970.23--Environment, Conservation, Occupational Safety, and
Drug Free Work Place
7. Sections 970.2304-1 and 970.2304-2 are revised to read as
follows:
970.2304-1 General.
The policy for the acquisition and use of EPA designated items,
i.e., items with recovered/recycled content, is set forth at 48 CFR
(FAR) 23.4--Use of Recovered Materials as supplemented by 48 CFR (DEAR)
923.405(e) and by 48 CFR (FAR) 23.704, Application to Government-owned
or leased facilities, and 48 CFR (FAR) 23.705, Contract clause.
970.2304-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR (FAR)
52.223-10, Waste Reduction Program, and the clause at 48 CFR (DEAR)
970.5223-2, Affirmative Procurement Program, in contracts for the
management of DOE facilities, including national laboratories. If the
contractor subcontracts a significant portion of the operation of the
Government facility which includes the acquisition of items designated
in EPA's Comprehensive Procurement Guidelines, the subcontract shall
contain a clause substantially the same as that at 48 CFR (DEAR)
970.5223-2. The EPA Comprehensive Procurement Guidelines identify
products which Federal agencies and their contractors are to procure
with recycled content pursuant to 40 CFR part 247. Examples of such
subcontracts would be operation of the facility supply function,
construction or remodeling at the facility, or maintenance of the
facility motor vehicle fleet. In situations in which the facility
management contractor can reasonably determine the amount of products
with recovered/recycled content to be acquired under the subcontract,
the facility management contractor is not required to flow down the
reporting requirement of the 970.5223-2 clause. Instead, the facility
management contractor may include the subcontract quantities in its own
report and include an agreement in the subcontract that such products
will be acquired with recovered/recycled content and that the
subcontractor will advise if it is unable to procure such products with
recovered/recycled content because the product is not available:
(a) Competitively within a reasonable time;
(b) At a reasonable price; or,
(c) Within the performance requirements.
Subpart 970.52--Solicitation Provisions and Contract Clauses for
Management and Operating Contracts
8. Section 970.5223-2 is revised to read as follows:
970.5223-2 Affirmative procurement program.
As prescribed in 48 CFR (DEAR) 970.2304-2, insert the following
clause in contracts for the management and operation of DOE facilities,
including national laboratories.
Affirmative Procurement Program--March 2003
(a) In the performance of this contract, the Contractor shall
comply with the requirements of Executive Order 13101 and the U.S.
Department of Energy (DOE) Affirmative Procurement Program Guidance.
This guidance includes requirements concerning environmentally
preferable products and services, recycled content products and
biobased products. This guidance is available on the Internet.
(b) In complying with the requirements of paragraph (a) of this
clause, the Contractor shall coordinate its activities with the DOE
Recycling Coordinator. Reports required by paragraph (c) of this
clause shall be submitted through the DOE Recycling Coordinator.
(c) The Contractor shall prepare and submit reports, at the end
of the Federal fiscal year, on matters related to the acquisition of
items designated in EPA's Comprehensive Procurement Guidelines that
Federal agencies and their Contractors are to procure with
recovered/recycled content.
(d) If the Contractor subcontracts a significant portion of the
operation of the Government facility which includes the acquisition
of items designated in EPA's Comprehensive Procurement Guidelines,
the subcontract shall contain a clause substantially the same as
this clause. The EPA Comprehensive Procurement Guidelines identify
products which Federal agencies and their Contractors are to procure
with recycled content pursuant to 40 CFR 247. Examples of such a
subcontract would be operation of the facility supply function,
construction or remodeling at the facility, or maintenance of the
facility motor vehicle fleet. In situations in which the facility
management contractor can reasonably determine the amount of
products with recovered/recycled content to be acquired under the
subcontract, the facility management contractor is not required to
flow down the reporting requirement of this clause. Instead, the
facility management contractor may include such quantities in its
own report and include an agreement in the subcontract that such
products will be acquired with recovered/recycled content and that
the subcontractor will advise if it is unable to procure such
products with recovered/recycled content because the product is not
available:
(i) Competitively within a reasonable time;
(ii) At a reasonable price; or,
(iii) Within the performance requirements.
If reports are required of the subcontractor, such reports shall
be submitted to the facility management contractor. The reports may
be submitted at the conclusion of the subcontract term provided that
the subcontract delivery term is not multi-year in nature. If the
delivery term is multi-year, the subcontractor shall report its
accomplishments for each Federal fiscal year in a manner and at a
time or times acceptable to both parties
(e) When this clause is used in a subcontract, the word
``Contractor'' will be understood to mean ``subcontractor'' and the
term ``DOE Recycling Coordinator'' will be understood to mean
``Contractor Recycling Coordinator.''
[FR Doc. 03-2911 Filed 2-6-03; 8:45 am]
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