Washington State's Multifamily Housing Laws for 2026: A Comprehensive Guide for Property Owners
Olive Tree Property Management - February 5, 2026
Washington State's Multifamily Housing Laws for 2026: A Comprehensive Guide for Property Owners
Washington State has undergone a dramatic transformation in housing policy over the past year, with 2025 marking one of the most significant legislative sessions for multifamily property owners in state history. From statewide rent control to parking reform and transit-oriented development, these changes will reshape how landlords operate throughout 2026 and beyond. This comprehensive guide breaks down the key laws affecting multifamily properties, with citations to help you understand your obligations.
The Context: Washington's Housing Policy Evolution
Before diving into specific laws, it's important to understand the trajectory. Washington has been systematically dismantling barriers to housing production since 2023, when the legislature passed landmark middle housing and ADU legalization bills. In 2024, single-room occupancy buildings became fully legal in apartment zones. The 2025 session completed the trifecta with rent stabilization, parking reform, and transit-oriented development requirements.[^1]
As Representative Julia Reed (D-36th, Seattle), author of 2025's transit-oriented development bill, told The Urbanist: "There's still more to do, but I think that in terms of these really, really big regulatory regimes, we've sort of put those in place."[^2]
The 2026 session, by contrast, is expected to be much quieter on housing issues, focusing on technical refinements rather than sweeping reforms. This makes understanding the 2025 changes critical—they represent the new operating framework for years to come.
[^1]: Multifamily Dive. "Washington governor signs rent control into law." May 13, 2025. https://www.multifamilydive.com/news/rent-control-Washington-legislation/747994/
[^2]: The Urbanist. "2026: The Year the Washington Legislature Catches Its Breath on Housing." January 2026. https://www.theurbanist.org/2026/01/14/2026-washington-legislature-catches-breath-on-housing/
HB 1217: Statewide Rent Control (Effective May 7, 2025)
Overview
House Bill 1217, signed into law by Governor Bob Ferguson on May 7, 2025, established Washington's first statewide rent control measures. The law took effect immediately, making Washington the third state (after Oregon and California) to implement statewide rent control.[^3]
Critical Note: The law applies to ALL rental agreements, including those signed before May 7, 2025. Any rent increases taking effect after May 7, 2025, must comply with HB 1217, even if notice was sent earlier.[^4]
[^3]: Stoel Rives LLP. "Washington Enacts Statewide Rent Control | Key Landlord Obligations Under HB 1217." https://www.stoel.com/insights/publications/washington-enacts-statewide-rent-control-key-rules-now-in-effect
[^4]: Limitless Law PLLC. "Washington State's New Rent Control Law (HB 1217)." June 8, 2025. https://www.limitlesslaw.com/washington-s-new-rent-control-law-hb-1217-what-landlords-need-to-know
Rent Increase Caps for 2026
For Standard Residential Tenancies:
- Maximum increase: 9.683% for calendar year 2026
- Formula: 7% + Consumer Price Index (CPI), or 10%, whichever is less
- The Washington Department of Commerce calculates and publishes this annually based on June CPI data for the Seattle-Tacoma-Bellevue area[^5]
For Manufactured/Mobile Home Tenancies:
- Maximum increase: 5% annually
- This lower cap does not sunset and is permanent[^6]
No Increases During First Year: Landlords may not increase rent for any tenancy type during the first 12 months after the tenancy begins, regardless of whether the lease is month-to-month or fixed-term.[^7]
[^5]: Washington State Department of Commerce. "HB 1217 Landlord Resource Center." https://www.commerce.wa.gov/housing-policy/hb1217-landlord-resource-center/
[^6]: Washington State Attorney General. "AG Brown begins enforcing Washington's new housing law." https://www.atg.wa.gov/news/news-releases/ag-brown-begins-enforcing-washington-s-new-housing-law-yielding-refunds-0
[^7]: Multifamily NW. "New Rent Increase Limits for Washington State (2025-2026)." https://www.multifamilynw.org/news/new-rent-increase-limits-for-washington-state-2025-2026
Notice Requirements
Landlords must provide 90 days' written notice before implementing any rent increase, up from the previous 60-day requirement. For manufactured/mobile home tenancies, at least three months' notice prior to the anniversary date is required.[^8]
Notice Must Include:
- Specific language mandated by HB 1217
- If claiming an exemption, specific facts and supporting documentation
- The notice must be served in accordance with RCW 59.12.040 (same as eviction service requirements)
- Cannot be sent via email alone—must attempt personal service[^9]
[^8]: Lasher. "Takeaways from Washington's New Rent Control Law." https://www.lasher.com/takeaways-from-washingtons-new-rent-control-law/
[^9]: TMG Property Management Services NW. "Washington's New Rent Cap Law Is In Effect." September 4, 2025. https://tmgnorthwest.com/washingtons-new-rent-cap-law-is-in-effect/
Rental Parity Between Lease Types
HB 1217 requires "rental parity" between different lease types for the same dwelling unit. Landlords may not charge more than a 5% difference in rent between month-to-month and fixed-term leases for the same unit.[^10]
This provision prevents landlords from charging significantly higher rents to discourage month-to-month tenancies or to incentivize longer lease terms.
[^10]: Stoel Rives LLP. "Washington Enacts Statewide Rent Control."
Exemptions from Rent Caps
Certain tenancies are exempt from the rent increase limitations:
- New Construction: Properties exempt for 12 years from the date of first certificate of occupancy
- Owner-Occupied Small Buildings: Duplexes, triplexes, and fourplexes where the owner resides in one unit as their principal residence at tenancy inception and continues to reside there
- Single-Family Owner-Occupied: Residences where the owner rents no more than two units/bedrooms, including ADUs
- Nonprofit-Owned Properties: Properties owned by nonprofit organizations
- Low-Income Housing Tax Credit Properties: Tenancies in qualified developments with enforceable regulatory agreements
- Shared Facilities: Tenancies where tenants share bathroom or kitchen facilities with the owner who resides on the property
- Vacancy Increases: Rent adjustments after a tenant vacates are not subject to caps (though notice requirements still apply)[^11]
Important: Landlords claiming exemptions must include specific supporting facts and documentation in their rent increase notices.
[^11]: Multifamily NW. "WA State House Bill 1217 - Limits to Rent Increases." https://www.multifamilynw.org/news/wa-state-house-bill-1217---limits-to-rent-increases-changes-to-notice-requirements-and-tenancy-rules
Enforcement and Penalties
Washington Attorney General Enforcement: The Attorney General can pursue civil penalties of up to $7,500 per violation under the Consumer Protection Act. By August 2025, the AG's office had already secured resolutions with eight landlords across the state who violated the law, resulting in withdrawn rent increase notices and refunds to tenants.[^12]
Private Tenant Lawsuits: Tenants have a private right of action and can recover:
- Any excess rent, fees, or costs paid
- Up to three months' rent for unlawful charges
- Reasonable attorneys' fees and costs[^13]
Tenant Remedies: Before suing, tenants must provide landlords with a written demand to reduce unauthorized increases to compliant amounts (opportunity to cure). Tenants may also terminate their rental agreement with 20 days' written notice if rent increases exceed legal caps, without incurring lease break penalties.[^14]
[^12]: Washington State Attorney General. "AG Brown begins enforcing Washington's new housing law."
[^13]: Limitless Law PLLC. "Washington State's New Rent Control Law (HB 1217)."
[^14]: Stoel Rives LLP. "Washington Enacts Statewide Rent Control."
Sunset Provision
Most provisions of HB 1217 expire after 15 years on July 1, 2040. However, the rental caps on manufactured/mobile homes do not have an expiration date and are permanent.[^15]
[^15]: Stoel Rives LLP. "Washington Enacts Statewide Rent Control."
SB 5184: Parking Reform and Modernization Act (Effective July 27, 2025)
Overview
Senate Bill 5184, also signed by Governor Ferguson on May 7, 2025, fundamentally reforms parking requirements statewide. The law aims to reduce development costs, encourage alternative transportation, and increase housing supply by eliminating excessive parking mandates that legislators determined drive up costs and discourage housing production.[^16]
[^16]: WA-Law.org. "SB 5184 - Minimum parking requirements." https://wa-law.org/bill/2025-26/sb/5184/1/
Maximum Parking Requirements
For cities with populations of 30,000 or more, the following maximum parking requirements apply:
Residential:
- Multifamily housing: 0.5 spaces per dwelling unit maximum
- Single-family homes: 1 space per home maximum
Commercial:
- 2 spaces per 1,000 square feet maximum[^17]
These are MAXIMUMS—cities cannot require more than these amounts. Developers may choose to provide additional parking based on market demand and project needs.
[^17]: Washington State Legislature. "ESSB 5184 As Amended By The House." https://lawfilesext.leg.wa.gov/biennium/2025-26/Pdf/Bills/Session%20Laws/Senate/5184-S.SL.pdf
No Parking Requirements Allowed For:
Cities may not impose ANY minimum parking requirements for:
- Residences under 1,200 square feet
- Commercial spaces under 3,000 square feet
- Affordable housing (any size)
- Senior housing
- Licensed child care centers
- Ground-level non-residential spaces in mixed-use buildings
- Buildings undergoing change of use (e.g., converting from office to residential)
- Existing buildings changing use[^18]
[^18]: MRSC. "2025 Legislation Affecting Local Government Planning." August 2025. https://mrsc.org/stay-informed/mrsc-insight/august-2025/2025-planning-legislation
Transit-Adjacent Properties
Cities with populations of at least 10,000 (within counties with population density exceeding 100 people per square mile) may not require off-street parking as a condition of permitting development of multifamily, middle housing, or ADUs located within one-half mile walking distance of transit service.
For this provision, "transit service" means at least one route providing service at least four times per hour for 12 or more hours per day.[^19]
[^19]: Senator Jessica Bateman. "Parking reform legislation passes Senate." February 21, 2025. https://senatedemocrats.wa.gov/bateman/2025/02/19/parking-reform-legislation-passes-senate/
Implementation Timeline
The parking reform law's implementation varies by city size:
- Cities over 50,000 residents: Must comply by December 2026
- Cities with 30,000-50,000 residents: Must comply by July 2028
- Cities under 30,000: Generally exempt from requirements[^20]
[^20]: PSRC. "Washington State Growth Management Program June 2025 New TOD and Parking Laws." https://www.psrc.org/media/9707
Exemptions and Exceptions
The parking reform law provides exemptions for:
- Cities and counties with populations under 30,000
- Areas near large commercial airports (where demonstrated parking needs exist)
- Jurisdictions that can demonstrate safety concerns through empirical studies[^21]
ADA Requirements: Nothing in SB 5184 affects parking requirements under the Americans with Disabilities Act, which remain in full effect.[^22]
[^21]: BillTrack50. "WA SB5184 - Concerning minimum parking requirements." https://www.billtrack50.com/billdetail/1770714
[^22]: Your Voice Renton. "State Law ESSB 5184 - Parking Reform." https://yourvoice.rentonwa.gov/state-law-essb-5184-parking-reform
What This Means for Multifamily Development
The parking reforms create significant opportunities for multifamily developers:
Cost Savings: Structured parking can cost $30,000-$70,000 per space. Reducing required parking from 1.5 spaces per unit to 0.5 spaces per unit on a 50-unit project could save $1.5-$3.5 million in construction costs.
Land Use Efficiency: Less land devoted to parking means more land available for residential units or amenities, increasing project feasibility on constrained urban sites.
Flexibility: Developers can now build projects that match actual parking demand rather than arbitrary minimums that often exceed actual usage.
Transit-Oriented Development: Projects near transit can eliminate parking entirely, making higher-density development more feasible near bus and rail lines.
Other Significant 2025 Housing Laws Affecting Multifamily
HB 1757: Multifamily Conversions
Requires cities to create rules facilitating the conversion of non-residential buildings to multifamily housing. This law recognizes that many commercial buildings (especially offices) have become underutilized and can be repurposed for housing.[^23]
[^23]: Multifamily Dive. "Washington governor signs rent control into law."
SB 5313: Prohibited Rental Agreement Provisions
Expands the list of provisions prohibited in residential rental agreements, providing additional tenant protections regarding lease terms and conditions.[^24]
[^24]: Multifamily Dive. "Washington governor signs rent control into law."
SB 5529: Affordable Housing Tax Incentives
Expands existing affordable housing tax incentive programs, making it more financially attractive for developers to include affordable units in multifamily projects.[^25]
[^25]: Multifamily Dive. "Washington governor signs rent control into law."
SB 5611: Reduced Permit Timelines
Establishes requirements for reducing housing permit review timelines, helping expedite multifamily development approvals. This builds on earlier legislation (SB 5290 from 2023) that created mandatory review timelines for jurisdictions.[^26]
[^26]: Multifamily Dive. "Washington governor signs rent control into law."
Co-Living Housing Requirements (2024 Law, 2025-26 Implementation)
While technically passed in 2024, local jurisdictions are implementing co-living housing requirements through late 2025 and 2026. Cities must allow co-living housing (single-room occupancy, boarding houses) on any lot within urban growth areas that allows at least six multifamily units.
Key requirements include:
- Cannot require room dimensions larger than state building code
- May not treat sleeping units as more than ¼ of a dwelling unit for density purposes
- Cannot require more than 0.25 parking spaces per sleeping unit (or any parking within ½ mile of major transit)
- Must reduce sewer connection fees to half of standard dwelling unit rates[^27]
[^27]: MRSC. "Six Housing and Planning Bills that Help Washington Communities." August 2024. https://mrsc.org/stay-informed/mrsc-insight/august-2024/six-housing-and-planning-bills-that-help-washington-communities-confront-the-housing-crisis
Looking Ahead: 2026 Legislative Session Priorities
SB 6026: Residential Uses in Commercial Zones
One of the most significant bills expected in the 2026 session, SB 6026 (requested by Governor Ferguson) would bar cities and counties over 30,000 population from excluding residential development in areas zoned for commercial or mixed-use. The bill would also prohibit requiring ground-floor commercial space in mixed-use zones as a condition of housing development.[^28]
This represents a major philosophical shift: instead of preserving commercial-only zones, the state would prioritize housing production by allowing residential uses anywhere commercial uses are permitted.
[^28]: Rental Housing Journal. "Washington State Legislation To Boost Housing Construction." January 2026. https://rentalhousingjournal.com/washington-state-legislation-to-boost-housing-construction/
SB 5156: Residential Elevator Standards Reform
Senator Jesse Salomon's bill to legalize smaller elevators in buildings six stories or shorter with 24 units or less is expected to return. Current requirements mandate elevators large enough for a full 24-inch by 84-inch stretcher, which makes elevators prohibitively expensive for smaller buildings. The reform would allow smaller, more affordable elevators, making mid-rise development more feasible.[^29]
[^29]: The Urbanist. "2026: The Year the Washington Legislature Catches Its Breath on Housing."
SB 5496: Restricting Institutional Investor Home Purchases
This proposal would prohibit large investor entities owning more than 25 single-family homes from acquiring additional houses, with exceptions for nonprofits or if adding units. The bill aims to curb bulk home purchases by institutional buyers that some argue reduce homeownership opportunities for individuals.[^30]
[^30]: Rental Housing Journal. "Washington State Legislation To Boost Housing Construction."
Housing Trust Fund Expansion
Governor Ferguson has championed a $225 million boost to the Housing Trust Fund, which would provide significant new capital for affordable housing development across the state.[^31]
[^31]: Rental Housing Journal. "Washington State Legislation To Boost Housing Construction."
Industry Response and Concerns
Opposition from Multifamily Associations
The Washington Multi-Family Housing Association and Rental Housing Association of Washington both strongly opposed HB 1217, expressing concerns that rent control will:
- Discourage new investment in Washington's rental market
- Exacerbate housing shortages by reducing development incentives
- Create regulatory uncertainty that makes long-term planning difficult
- Lead to property deterioration as landlords face constrained revenues[^32]
"This bill adds new regulatory uncertainty at a time when the industry is already grappling with rising costs, labor shortages and shifting economic conditions," the Washington Multi-Family Housing Association stated.
"Laws like HB 1217 make it harder to continue operating here, and harder to attract capital."[^33]
[^32]: Rental Housing Association of Washington. "Major Law Changes Now in Effect: What Residential Housing Providers Need to Know." https://www.rhawa.org/blog/major-law-changes-what-providers-need-to-know
[^33]: Multifamily Dive. "Washington governor signs rent control into law."
Support from Housing Advocates and Tech Industry
Conversely, housing advocacy organizations and some major employers support the housing production legislation. Amazon and Microsoft executives penned a Seattle Times op-ed urging lawmakers to cut red tape and "build our way out" of the housing crisis, specifically backing initiatives like SB 6026 and faster permitting processes.[^34]
Representative Strom Peterson (D-Edmonds), a key sponsor of HB 1217, defended the rent control law: "The landlords made mistakes but were able to work with the Attorney General's Office to make it right. This is one way we can start to turn the tide on the housing affordability crisis."[^35]
[^34]: Rental Housing Journal. "Washington State Legislation To Boost Housing Construction."
[^35]: Washington State Attorney General. "AG Brown begins enforcing Washington's new housing law."
Compliance Checklist for Multifamily Property Owners
Immediate Actions (If Not Already Completed)
For Rent Control Compliance:
- Review All Rent Increase Notices: Any increases taking effect after May 7, 2025, must comply with HB 1217, even if notice was sent earlier
- Update Lease Templates: Ensure all leases comply with rental parity requirements (no more than 5% difference between lease types)
- Implement 90-Day Notice Procedures: Update your systems to provide 90 days' notice for all rent increases
- Verify Exemption Status: If claiming exemptions (new construction, owner-occupied, etc.), gather supporting documentation
- Train Staff: Ensure all property management personnel understand the new requirements and notice procedures
- Calculate 2026 Increases: Use the 9.683% cap for standard residential; 5% for manufactured/mobile homes
- Update Forms: Use the specific language required by HB 1217 in all rent increase notices
For Parking Reform Compliance:
- Determine Your Deadline: Cities over 50,000 must comply by December 2026; cities 30,000-50,000 by July 2028
- Review In-Process Projects: Ensure pending developments comply with new maximum parking requirements
- Consider Design Changes: For projects still in planning, reconsider parking allocation to reduce costs
- Update Pro Formas: Adjust financial models to reflect reduced parking costs and potentially higher unit counts
- Communicate with Cities: Engage with local planning departments about implementation timelines
Ongoing Compliance
Monthly:
- Review rent increase calculations to ensure compliance with caps
- Monitor CPI updates from Washington Department of Commerce
- Track notice timing to ensure 90-day minimum is met
Quarterly:
- Review lease agreements for rental parity compliance
- Audit property exemption documentation
- Update staff training on evolving requirements
Annually:
- Review maximum rent increase percentages published by Department of Commerce (typically released July)
- Assess parking requirements for compliance with SB 5184
- Conduct legal compliance audit with qualified attorney
- Update all forms and templates
Resources for Compliance
Government Resources:
- Washington Department of Commerce HB 1217 Resource Center: https://www.commerce.wa.gov/housing-policy/hb1217-landlord-resource-center/
- Department of Commerce Multifamily Housing: https://www.commerce.wa.gov/multifamily-rental-housing/
- Washington Attorney General Consumer Protection: File complaints or seek guidance
Industry Associations:
- Washington Multi-Family Housing Association (WMFHA): https://www.wmfha.org/
- Rental Housing Association of Washington (RHAWA): https://www.rhawa.org/
- Multifamily NW: https://www.multifamilynw.org/ (serves Washington and Oregon)
Legal Resources:
- Both WMFHA and RHAWA maintain lists of attorneys specializing in landlord-tenant law
- Many firms offer compliance audits specifically for HB 1217 and SB 5184
Strategic Considerations for Investors and Developers
New Construction Advantage
The 12-year exemption from rent control for new construction creates a significant competitive advantage for new developments. Properties delivered in 2026 won't be subject to rent caps until 2038, providing long-term flexibility for rent growth that existing properties lack.
Investment Implication: New construction may command premium pricing in acquisition markets due to this exemption, and pro formas can include higher rent growth assumptions during the exemption period.
Parking Reform Opens New Development Sites
The dramatic reduction in parking requirements makes previously infeasible sites viable for multifamily development:
- Transit-Adjacent Sites: Properties near bus and rail lines can now be developed with minimal or no parking, drastically reducing costs
- Constrained Urban Lots: Smaller urban sites that couldn't accommodate both housing and excessive parking can now deliver more residential units
- Adaptive Reuse: Converting commercial buildings to residential becomes more economically viable without parking requirements
Rent Control Impact on Existing Properties
For properties subject to rent caps, the 9.683% maximum for 2026 provides some runway, but over time the 7% + CPI formula will constrain rent growth below market rates in strong markets.
Portfolio Strategies:
- Value-Add Repositioning: Complete major renovations to maximize rents before long-term holds under rent control
- Selective Disposition: Consider selling assets in markets where rent growth expectations exceed caps
- Focus on Operations: With limited rent growth potential, operational efficiency becomes critical to NOI growth
- Tenant Retention: Turnover provides opportunity for market-rate resets; focus on keeping quality tenants long-term
Market Outlook Differences
The impact of these laws will vary significantly across Washington's markets:
Seattle and Major Urban Areas:
- Rent control caps will constrain growth in strong submarkets where market rents would otherwise rise faster
- Parking reform will have the biggest impact, enabling more urban infill and transit-oriented development
- Expect increased development activity as projects become more feasible with reduced parking costs
Smaller Cities (30,000-50,000 population):
- Rent control may have less immediate impact in markets with weaker rent growth
- Parking reform implementation delayed until July 2028, providing planning time
- Watch for impacts from 2026 commercial-to-residential zoning reforms (SB 6026)
Manufactured Home Communities:
- The 5% cap (without sunset) presents the most significant long-term constraint
- Park owners face constitutional challenge (lawsuit filed arguing cap is unconstitutional)
- Expect continued industry opposition and potential legislative modifications
Long-Term Trends and Policy Direction
Washington's housing policy evolution shows clear directional momentum:
Supply-Side Focus
The legislature has prioritized eliminating barriers to housing production over demand-side interventions. Middle housing legalization, ADU reforms, parking reduction, and commercial-to-residential conversion all aim to increase supply rather than restrict landlord operations (with rent control being the notable exception).
State Preemption of Local Control
Increasingly, the state is overriding local zoning and planning decisions in favor of statewide housing production goals. This represents a significant philosophical shift from Washington's historical deference to local control.
Ongoing Evolution
Despite the 2026 "breather" session, expect continued refinement of housing policy. As Representative Reed noted, the focus shifts from sweeping reforms to targeted fixes: "We need the state to write the model code."
Uncertainty for Investors
The pace of change creates planning challenges for long-term investors. What's legal today may be required tomorrow, and what's prohibited today may be mandated next session. Successful operators will need to stay engaged with legislative developments and maintain flexibility in their business models.
Conclusion
Washington State's 2025 legislative session fundamentally restructured the regulatory framework for multifamily housing. Between statewide rent control, parking reform, and various housing production initiatives, nearly every aspect of multifamily operations has been touched by new legislation.
For property owners, 2026 represents a critical implementation year. The rent control law is already in effect and being actively enforced by the Attorney General. Parking reforms must be implemented by December 2026 for large cities. Additional changes will roll out through 2027-2028 as smaller jurisdictions come into compliance.
The most successful multifamily operators will be those who:
- Understand and comply with the specific requirements of each new law
- Implement robust systems and processes for tracking compliance
- Train staff thoroughly on new procedures, especially for rent increases
- Stay engaged with industry associations and monitor legislative developments
- Adapt investment and operational strategies to the new regulatory environment
While the industry has expressed significant concerns about rent control's long-term impacts, the immediate reality is that these are the new rules of the game. Property owners who adapt quickly, maintain rigorous compliance, and find opportunities within the new framework will be best positioned for success in Washington's evolving multifamily market.
The combination of rent control (limiting revenue growth) and parking reform (reducing development costs) creates an interesting dynamic: constrained returns on existing assets but improved feasibility for new development. This suggests a market that may favor new construction over existing assets, development over acquisition, and operational excellence over rent growth as the path to value creation.
For investors evaluating Washington's multifamily market, the question isn't whether these laws are good or bad—it's how to build a business model that succeeds within this new regulatory reality. Those who can answer that question will find opportunities even as the competitive landscape shifts beneath their feet.
This article is for informational purposes only and does not constitute legal advice. Property owners should consult with qualified legal counsel regarding specific compliance questions and requirements. Laws and regulations are subject to change, and implementation details may vary by jurisdiction.
Key Dates to Remember:
- May 7, 2025: HB 1217 (rent control) took effect
- July 27, 2025: SB 5184 (parking reform) took effect
- December 2026: Large cities (50,000+) must comply with parking reform
- July 2028: Medium cities (30,000-50,000) must comply with parking reform
- July 1, 2040: Most HB 1217 provisions sunset (except manufactured home caps)
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