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In my experience AIs are nominated by an alumna or two, sometimes by an alumnae chapter depending on the org. The AI is initiated at a nearby university chapter often during the chapter's regular initiations. The chapter knows about it ahead of time. The initiation is attended by some of the alumnae from the chapter the AI will be a member of as well as local national officers and any family members who are members of the sorority. The collegiate members always thought it was neat.
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I live in Fantasyland and I have waterfront property.
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