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[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3719 Introduced in House (IH)]

<DOC>

116th CONGRESS
  1st Session
                                H. R. 3719

To amend the Security and Accountability for Every Port Act of 2006 to 
 reauthorize the Customs Trade Partnership Against Terrorism Program, 
                        and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             July 11, 2019

   Mr. Higgins of Louisiana (for himself, Mr. McCaul, Mr. Rogers of 
Alabama, Mr. Cuellar, and Mr. Buchanan) introduced the following bill; 
        which was referred to the Committee on Homeland Security

_______________________________________________________________________

                                 A BILL

 
To amend the Security and Accountability for Every Port Act of 2006 to 
 reauthorize the Customs Trade Partnership Against Terrorism Program, 
                        and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``CTPAT Reauthorization Act of 2019''.

SEC. 2. CUSTOMS TRADE PARTNERSHIP AGAINST TERRORISM.

    (a) In General.--Subtitle B of title II of the Security and 
Accountability for Every Port Act of 2006 (6 U.S.C. 961 et seq.) is 
amended to read as follows:

       ``Subtitle B--Customs Trade Partnership Against Terrorism

``SEC. 211. ESTABLISHMENT OF THE CUSTOMS TRADE PARTNERSHIP AGAINST 
              TERRORISM PROGRAM.

    ``(a) In General.--There is established within U.S. Customs and 
Border Protection a voluntary government-private sector partnership 
program to be known as the Customs Trade Partnership Against Terrorism 
(CTPAT).
    ``(b) Purpose.--The purposes of the CTPAT program are to--
            ``(1) strengthen and improve the overall security of the 
        international supply chain and United States border security;
            ``(2) facilitate the movement of secure cargo through the 
        international supply chain;
            ``(3) ensure compliance with applicable law; and
            ``(4) serve as the Authorized Economic Operator program for 
        the United States.
    ``(c) Director.--There shall be at the head of the CTPAT program a 
Director, who shall report to the Executive Assistant Commissioner of 
the Office of Field Operations (in this subtitle referred to as the 
`Executive Assistant Commissioner') of U.S. Customs and Border 
Protection.
    ``(d) Duties.--The Director of the CTPAT program shall--
            ``(1) oversee the activities of the CTPAT program, 
        including certification of CTPAT participants;
            ``(2) evaluate and make revisions to security criteria 
        pursuant to subsections (c) and (d) of section 213;
            ``(3) ensure that participants receive a tangible and 
        measurable benefit for participation; and
            ``(4) carry out other duties and powers prescribed by the 
        Executive Assistant Commissioner.

``SEC. 212. ELIGIBLE ENTITIES AND NOTICE OF BENEFITS.

    ``(a) Eligible Entities.--
            ``(1) In general.--Importers, exporters, customs brokers, 
        forwarders, air, sea, and land carriers, contract logistics 
        providers, and other entities in the international supply chain 
        and intermodal transportation system are eligible to apply for 
        participation in the CTPAT program.
            ``(2) Expansion.--The Commissioner may expand the list of 
        entities eligible to apply for CTPAT participation only in 
        accordance with the purpose of the CTPAT program.
    ``(b) Tiered Participation.--
            ``(1) In general.--Applicants specified in subsection (a) 
        may be eligible to participate as Tier 1 or Tier 2 
        participants.
            ``(2) Importers.--Importers may be eligible to participate 
        as Tier 3 participants.
            ``(3) Extension.--The Commissioner may extend Tier 3 
        participation to other entity types, if appropriate, and to 
        specific Tier 2 CTPAT program participants in accordance with 
        section 217(b).
    ``(c) Notice of Benefits.--
            ``(1) In general.--The Commissioner shall publish, on the 
        U.S. Customs and Border Protection website and through other 
        appropriate online publication, information about benefits 
        available under each tier of the CTPAT program.
            ``(2) Changes.--The Commissioner shall publish, on the U.S. 
        Customs and Border Protection website and through other 
        appropriate online publication, notice of any changes to 
        benefits available under each tier of the CTPAT program not 
        later than 30 days before any such changes take effect.

``SEC. 213. PARTICIPATION ELIGIBILITY.

    ``(a) In General.--The Executive Assistant Commissioner shall 
review all documentation submitted by an applicant pursuant to 
subsection (b)(2), conduct a background investigation of such 
applicant, and vet such applicant.
    ``(b) General Requirements.--To be eligible for participation in 
the CTPAT program, an entity shall, at a minimum--
            ``(1) have a designated company employee authorized to bind 
        such entity who is a direct company employee and will serve as 
        the primary point of contact responsible for participation of 
        such entity in the CTPAT program;
            ``(2) at the time of initial application and annually 
        thereafter, including in advance of any recertification or 
        revalidation, submit an international supply chain security 
        profile, which shall identify how such entity meets the minimum 
        security criteria of the CTPAT program established by the 
        Commissioner and how such entity will maintain and enhance 
        internal policies, procedures, and practices related to 
        international supply chain security; and
            ``(3) meet any specific requirements for eligible entities, 
        as established by the Commissioner.
    ``(c) Minimum Security Criteria.--The Commissioner shall establish 
minimum security criteria for participants in the CTPAT program, review 
such minimum security criteria not less than once every two years, and 
update such minimum security criteria as necessary. Such minimum 
security criteria shall seek to address security vulnerabilities in the 
international supply chain.
    ``(d) Additional and Updated Criteria.--The Commissioner may 
establish additional and updated security criteria for individual CTPAT 
program participants, categories of CTPAT program participants, or 
particular entity types to meet in order to address a security 
vulnerability in the international supply chain.
    ``(e) Consultation.--When establishing or updating security 
criteria in accordance with subsection (c), and when establishing new 
or updated security criteria in accordance subsection (d), the 
Commissioner shall consult with CTPAT program participants and other 
interested parties, and shall--
            ``(1) conduct a cost benefit analysis of such proposed new 
        or updated security criteria, as the case may be, in 
        consultation with the Commercial Customs Operations Advisory 
        Committee established under section 109 of the Trade 
        Facilitation and Trade Enforcement Act of 2015 (Public Law 114-
        125; 19 U.S.C. 4316);
            ``(2) determine operational feasibility and, where 
        appropriate, provide best practices for meeting such new or 
        updated security criteria to CTPAT program participants 
        specific to their entity type;
            ``(3) conduct a phased implementation of such proposed new 
        or updated security criteria; and
            ``(4) provide CTPAT program participants and other 
        interested parties a 90-day comment period to review and 
        comment on such proposed new or updated security criteria.
    ``(f) Waiver.--The Commissioner may waive the requirements of 
subsection (e) if the Commissioner determines there is a significant 
and imminent risk to the national security of the United States and 
such a waiver is necessary to protect such national security. Not later 
than 120 days after the issuance of any such waiver, the Commissioner 
shall announce on the U.S. Customs and Border Protection website and 
through other appropriate online publication the Commissioner's intent 
to either withdraw such waiver or maintain such waiver while commencing 
efforts to establish new or updated security criteria in accordance 
with subsection (c) or (d), respectively.

``SEC. 214. BENEFITS FOR CTPAT PROGRAM PARTICIPANTS.

    ``(a) In General.--The Executive Assistant Commissioner shall 
extend certain benefits to each CTPAT program participant. Minimum 
benefits for each such participant shall include the following:
            ``(1) Assignment of a U.S. Customs and Border Protection 
        Supply Chain Security Specialist.
            ``(2) Access to the CTPAT program's web-based Portal 
        system, training materials, and a mechanism by which to verify 
        other CTPAT program participants' CTPAT status.
            ``(3) Timely supply chain threat alerts categorized by 
        CTPAT program participant entity type, and an annual and 
        unclassified update made available in such web-based Portal 
        system regarding regional and other relevant threats to the 
        international supply chain.
    ``(b) Annual Assessment.--
            ``(1) In general.--The Executive Assistant Commissioner 
        shall conduct, on an annual basis, an assessment of the 
        benefits conferred to CTPAT program participants by tier and 
        entity type. The Executive Assistant Commissioner shall 
        determine a process to carry out such assessments, including 
        projected milestones and completion dates for addressing data 
        reliability issues and, as necessary, correcting data 
        weaknesses, in order that U.S. Customs and Border Protection 
        can produce accurate and reliable annual assessments that can 
        be compared year-to-year.
            ``(2) Elements.--Each annual assessment conducted pursuant 
        to paragraph (1) shall at a minimum include the following:
                    ``(A) The average reduced security exam rate by 
                CTPAT program participant tier and entity type.
                    ``(B) The average reduction in penalties for CTPAT 
                program participants by tier and entity type.
                    ``(C) The average reduction in risk assessment for 
                CTPAT program participants by tier and entity type.
            ``(3) Public availability.--The Executive Assistant 
        Commissioner shall make each annual assessment publicly 
        available on the CTPAT portal for at least one year.
    ``(c) Consultation.--When assessing benefits in accordance with 
subsection (b), the Executive Assistant Commissioner shall consult with 
the Commercial Customs Operations Advisory Committee established under 
section 109 of the Trade Facilitation and Trade Enforcement Act of 2015 
(Public Law 114-125; 19 U.S.C. 4316) and the National Maritime Security 
Advisory Committee established under section 70112 of title 46, United 
States Code.

``SEC. 215. TIER 1 PARTICIPANTS.

    ``(a) Certification.--The Executive Assistant Commissioner shall 
certify the security measures and international supply chain security 
practices of all applicants to and participants in the CTPAT program in 
accordance with section 213(b)(2) and the guidelines referred to in 
subsection (c) of this section. Certified participants shall be Tier 1 
participants.
    ``(b) Benefits for Tier 1 Participants.--Upon completion of the 
certification under subsection (a), a CTPAT program participant shall 
be certified as a Tier 1 participant. The Executive Assistant 
Commissioner shall extend limited benefits to a Tier 1 participant.
    ``(c) Criteria.--Not later than 180 days after the date of the 
enactment of this subtitle, the Commissioner shall update the criteria 
for certifying a CTPAT program participant's security measures and 
supply chain security practices under this section. Such criteria shall 
include a background investigation and review of appropriate 
documentation, as determined by the Commissioner.
    ``(d) Timeframe.--To the extent practicable, the Executive 
Assistant Commissioner shall conclude the Tier 1 certification process 
within 90 days of receipt of a completed application for participation 
in the CTPAT program.

``SEC. 216. TIER 2 PARTICIPANTS.

    ``(a) Validation.--The Executive Assistant Commissioner shall 
validate the security measures and international supply chain security 
practices of a Tier 1 CTPAT program participant in accordance with the 
guidelines referred to in subsection (c) to validate such participant 
as a Tier 2 participant. Such validation shall include on-site 
assessments at appropriate foreign and domestic locations utilized by 
such Tier 1 participant in its international supply chain.
    ``(b) Benefits for Tier 2 Participants.--The Executive Assistant 
Commissioner, shall extend benefits to each CTPAT participant that has 
been validated as a Tier 2 participant under this section. Such 
benefits may include the following:
            ``(1) Reduced scores in U.S. Customs and Border 
        Protection's Automated Targeting System or successor system.
            ``(2) Reduced number of security examinations by U.S. 
        Customs and Border Protection.
            ``(3) Penalty mitigation opportunities.
            ``(4) Priority examinations of cargo.
            ``(5) Access to the Free and Secure Trade (FAST) Lanes at 
        United States ports of entry.
            ``(6) Confirmation of CTPAT status to foreign customs 
        administrations that have signed Mutual Recognition 
        Arrangements with U.S. Customs and Border Protection.
            ``(7) In the case of importers, eligibility to participate 
        in the Importer Self-Assessment Program (ISA) or successor 
        compliance program.
            ``(8) In the case of sea carriers, eligibility to 
        participate in the Advance Qualified Unlading Approval (AQUA) 
        Lane process.
    ``(c) Criteria.--Not later than 180 days after the date of the 
enactment of this subtitle, the Commissioner shall develop a schedule 
and update the criteria for validating a CTPAT participant's security 
measures and supply chain security practices under this section.
    ``(d) Timeframe.--To the extent practicable, the Executive 
Assistant Commissioner shall complete the Tier 2 validation process for 
a CTPAT program participant under this section within one year after 
certification of such participant as a Tier 1 participant.

``SEC. 217. TIER 3 PARTICIPANTS.

    ``(a) In General.--The Commissioner shall establish a third tier of 
CTPAT program participation that offers additional benefits to CTPAT 
program participants that are importers or other entity types, in 
accordance with section 212(b), that demonstrate a sustained commitment 
to maintaining security measures and international supply chain 
security practices that exceed the guidelines established for 
validation as a Tier 2 participant in the CTPAT program under section 
216.
    ``(b) Best Practices.--The Commissioner shall provide a best 
practices framework to Tier 2 participants interested in Tier 3 status 
and may designate a Tier 2 CTPAT program participant as a Tier 3 
participant based on a review of best practices in such participant's 
international supply chain that reflect a continued approach to 
enhanced international supply chain security, including--
            ``(1) compliance with any new or updated criteria 
        established by the Commissioner under section 213(d) that 
        exceed the guidelines established pursuant to section 216 for 
        validating a CTPAT program participant as a Tier 2 participant; 
        and
            ``(2) any other factors that the Commissioner determines 
        appropriate that are provided in such best practices framework.
    ``(c) Benefits for Tier 3 Participants.--The Executive Assistant 
Commissioner shall extend benefits to each CTPAT program participant 
that has been validated as a Tier 3 participant under this section, 
which, in addition to benefits for Tier 2 participation, may include 
the following:
            ``(1) Further reduction in the number of examinations by 
        U.S. Customs and Border Protection.
            ``(2) Front of the line inspections and examinations.
            ``(3) Exemption from Stratified Exams.
            ``(4) Shorter wait times at United States ports of entry.

``SEC. 218. CONSEQUENCES FOR LACK OF COMPLIANCE.

    ``(a) In General.--If at any time the Executive Assistant 
Commissioner determines that a CTPAT program participant's security 
measures or international supply chain security practices fail to meet 
applicable requirements under this subtitle, the Executive Assistant 
Commissioner may deny such participant benefits otherwise made 
available pursuant to this subtitle, either in whole or in part. The 
Executive Assistant Commissioner shall develop procedures, in 
consultation with Commercial Customs Operations Advisory Committee 
established under section 109 of the Trade Facilitation and Trade 
Enforcement Act of 2015 (Public Law 114-125; 19 U.S.C. 4316), that 
provide appropriate protections to CTPAT program participants, 
including advance notice and an opportunity for such participants to 
provide additional information to U.S. Customs and Border Protection 
regarding any such alleged failure, before any of such benefits are 
withheld. Such procedures may not limit the ability of the Executive 
Assistant Commissioner to take actions to protect the national security 
of the United States.
    ``(b) False or Misleading Information; Lack of Compliance With 
Law.--If a CTPAT program participant knowingly provides false or 
misleading information to the Commissioner, the Executive Assistant 
Commissioner, Director, or any other officers or officials of the 
United States Government, or if at any time the Executive Assistant 
Commissioner determines that a CTPAT program participant has committed 
a serious violation of Federal law or customs regulations, or if a 
CTPAT program participant has committed a criminal violation relating 
to the economic activity of such participant, the Executive Assistant 
Commissioner may suspend or remove such participant from the CTPAT 
program for an appropriate period of time. The Executive Assistant 
Commissioner, after the completion of the process described in 
subsection (d), may publish in the Federal Register a list of CTPAT 
program participants that have been so removed from the CTPAT program 
pursuant to this subsection.
    ``(c) National Security.--If at any time the Executive Assistant 
Commissioner determines that a CTPAT program participant poses a 
significant and imminent risk to the national security of the United 
States, the Executive Assistant Commissioner may suspend or remove such 
participant from the CTPAT program for an appropriate period of time. 
The Executive Assistant Commissioner, after the completion of the 
process described in subsection (d), may publish in the Federal 
Register a list of CTPAT program participants that have been so removed 
from the CTPAT program pursuant to this subsection.
    ``(d) Right of Appeal.--
            ``(1) In general.--The Commissioner shall establish a 
        process for a CTPAT program participant to appeal a decision of 
        the Executive Assistant Commissioner under subsection (a). Such 
        appeal shall be filed with the Commissioner not later than 90 
        days after the date of such decision, and the Commissioner 
        shall issue a determination not later than 90 days after such 
        appeal is filed.
            ``(2) Appeals of other decisions.--The Commissioner shall 
        establish a process for a CTPAT program participant to appeal a 
        decision of the Executive Assistant Commissioner under 
        subsections (b) and (c). Such appeal shall be filed with the 
        Commissioner not later than 30 days after the date of such 
        decision, and the Commissioner shall issue a determination not 
        later than 90 days after such appeal is filed.

``SEC. 219. VALIDATIONS BY OTHER DHS COMPONENTS.

    ``(a) In General.--The Commissioner may recognize regulatory 
inspections of entities conducted by other components of the Department 
of Homeland Security as sufficient to constitute validation for CTPAT 
program participation in cases in which any such component's inspection 
regime is harmonized with validation criteria for the CTPAT program. 
Such regulatory inspections shall not limit the ability of U.S. Customs 
and Border Protection to conduct a CTPAT program validation.
    ``(b) Revalidation.--Nothing in this section may limit the 
Commissioner's ability to require a revalidation by U.S. Customs and 
Border Protection.
    ``(c) Certification.--Nothing in this section may be construed to 
authorize certifications of CTPAT applicants to be performed by any 
party other than U.S. Customs and Border Protection.

``SEC. 220. RECERTIFICATION AND REVALIDATION.

    ``(a) Recertification.--The Commissioner shall implement a 
recertification process for all CTPAT program participants. Such 
process shall occur annually, and shall require--
            ``(1) a review of the security profile and supporting 
        documentation to ensure adherence to the minimum security 
        criteria under section 213; and
            ``(2) background checks and vetting.
    ``(b) Revalidation.--The Commissioner shall implement a 
revalidation process for all Tier 2 and Tier 3 CTPAT program 
participants. Such process shall require--
            ``(1) a framework based upon objective, risk-based criteria 
        for identifying participants for periodic revalidation at least 
        once every four years after the initial validation of such 
        participants;
            ``(2) on-site assessments at appropriate foreign and 
        domestic locations utilized by such a participant in its 
        international supply chain; and
            ``(3) an annual plan for revalidation that includes--
                    ``(A) performance measures;
                    ``(B) an assessment of the personnel needed to 
                perform such revalidations; and
                    ``(C) the number of participants that will be 
                revalidated during the following year.
    ``(c) Revalidation Under a Mutual Recognition Arrangement.--
            ``(1) In general.--Upon request from the Commissioner, all 
        Tier 2 and Tier 3 CTPAT program participants shall provide any 
        revalidation report conducted by a foreign government under a 
        Mutual Recognition Arrangement.
            ``(2) Recognition.--The Commissioner may recognize 
        revalidations of entities conducted by foreign governments 
        under a Mutual Recognition Arrangement as sufficient to 
        constitute a revalidation for CTPAT program participation under 
        subsection (b).
            ``(3) No limitation.--Nothing in this subsection may be 
        construed to limit the Commissioner's ability to require a 
        revalidation by U.S. Customs and Border Protection.
    ``(d) Designated Company Employees.--Only designated company 
employees of a CTPAT program participant under section 213(b)(1) are 
authorized to respond to a revalidation report. Third-party entities 
are not authorized to respond to a revalidation report.

``SEC. 221. NONCONTAINERIZED CARGO AND THIRD-PARTY LOGISTICS PROVIDERS.

    ``The Commissioner shall consider the potential for participation 
in the CTPAT program by importers of noncontainerized cargoes and non-
asset-based third-party logistics providers that otherwise meet the 
requirements under this subtitle.

``SEC. 222. PROGRAM MANAGEMENT.

    ``(a) In General.--The Commissioner shall establish sufficient 
internal quality controls and record management, including 
recordkeeping (including maintenance of a record management system in 
accordance with subsection (b)) and monitoring staff hours, to support 
the management systems of the CTPAT program. In managing the CTPAT 
program, the Commissioner shall ensure that the CTPAT program includes 
the following:
            ``(1) A five-year plan to identify outcome-based goals and 
        performance measures of the CTPAT program.
            ``(2) An annual plan for each fiscal year designed to match 
        available resources to the projected workload.
            ``(3) A standardized work program to be used by agency 
        personnel to carry out the certifications, validations, 
        recertifications, and revalidations of CTPAT program 
        participants.
            ``(4) In accordance with subsection (e), a standardized 
        process for the Executive Assistant Commissioner to receive 
        reports of suspicious activity, including reports regarding 
        potentially compromised cargo or other national security 
        concerns.
    ``(b) Documentation of Reviews.--
            ``(1) In general.--The Commissioner shall maintain a record 
        management system to document determinations on the reviews of 
        each CTPAT program participant, including certifications, 
        validations, recertifications, and revalidations.
            ``(2) Standardized procedures.--To ensure accuracy and 
        consistency within the record management system required under 
        this subsection, the Commissioner shall develop, disseminate, 
        and require utilization of standardized procedures for agency 
        personnel carrying out certifications, validations, 
        recertifications, and revalidations to report and track 
        information regarding the status of each CTPAT program 
        participant.
    ``(c) Confidential Information Safeguards.--In consultation with 
the Commercial Customs Operations Advisory Committee established under 
section 109 of the Trade Facilitation and Trade Enforcement Act of 2015 
(Public Law 114-125; 19 U.S.C. 4316), the Commissioner shall develop 
and implement procedures to ensure the protection of confidential data 
collected, stored, or shared with government agencies or as part of the 
application, certification, validation, recertification, and 
revalidation processes.
    ``(d) Resource Management Staffing Plan.--The Commissioner shall--
            ``(1) develop a staffing plan to recruit and train staff 
        (including a formalized training program) to meet the 
        objectives identified in the five-year strategic plan under 
        subsection (a)(1); and
            ``(2) provide cross-training in post incident trade 
        resumption for the CTPAT Director and other relevant personnel 
        who administer the CTPAT program.
    ``(e) Engagement.--In carrying out the standardized process 
required under subsection (a)(4), the Commissioner shall engage with 
and provide guidance to CTPAT program participants and other 
appropriate stakeholders on submitting reports described in such 
subsection.
    ``(f) Report to Congress.--In connection with the President's 
annual budget submission for the Department of Homeland Security, the 
Commissioner shall report to the appropriate congressional committees 
on the progress made by the Commissioner to certify, validate, 
recertify, and revalidate CTPAT program participants. Each such report 
shall be due on the same date that the President's budget is submitted 
to Congress.''.
    (b) Saving Clause.--
            (1) In general.--The amendments made by this Act shall take 
        effect and apply beginning on the date that is 90 days after 
        the date of the enactment of this Act with respect to 
        applicants for participation in the CTPAT program.
            (2) Exception.--Paragraph (1) shall not apply in case of 
        CTPAT program participants who are such participants as of the 
        date specified in such paragraph. Such participants shall be 
        subject to the amendments made by this Act upon revalidation of 
        such participants to participate in such program. Until such 
        time, such participants shall be subject to the requirements of 
        the CTPAT program as in existence on the day before the date of 
        the enactment of this Act.
    (c) Technical and Conforming Amendments.--The Security and 
Accountability for Every Port Act of 2006 is amended--
            (1) in paragraph (4) of section 2 (6 U.S.C. 901), by 
        striking ``Commissioner responsible for the United States 
        Customs and Border Protection'' and inserting ``Commissioner of 
        U.S. Customs and Border Protection''; and
            (2) in paragraph (2) of section 202(c) (6 U.S.C. 942(c)), 
        by striking ``C-TPAT'' and inserting ``CTPAT''.
    (d) Clerical Amendments.--The table of contents in section 1(b) of 
the Security and Accountability for Every Port Act of 2006 is amended 
by striking the items relating to subtitle B of title II and inserting 
the following new items:

       ``Subtitle B--Customs Trade Partnership Against Terrorism

``Sec. 211. Establishment of the Customs Trade Partnership Against 
                            Terrorism program.
``Sec. 212. Eligible entities and notice of benefits.
``Sec. 213. Participation eligibility.
``Sec. 214. Benefits for CTPAT program participants.
``Sec. 215. Tier 1 participants.
``Sec. 216. Tier 2 participants.
``Sec. 217. Tier 3 participants.
``Sec. 218. Consequences for lack of compliance.
``Sec. 219. Validations by other DHS components.
``Sec. 220. Recertification and revalidation.
``Sec. 221. Noncontainerized cargo and third-party logistics providers.
``Sec. 222. Program management.''.
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