UNPUBLISHED ORDER
                          Not to be cited per Circuit Rule 53



                           United States Court of Appeals
                              For the Seventh Circuit
                               Chicago, Illinois 60604

                                   October 26, 2006


                                        Before

                   Hon. RICHARD A. POSNER, Circuit Judge

                   Hon. KENNETH F. RIPPLE, Circuit Judge

                   Hon. DANIEL A. MANION, Circuit Judge


Nos. 02-3584 & 02-4344

UNITED STATES OF AMERICA,                        Appeals from the United States
                                                 District Court for the Northern
             Plaintiff-Appellee,                 District of Illinois, Eastern Division.

                                   v.            No. 01 CR 567

PEDRO L. CASTILLO and FRANK                      James F. Holderman,
RODRIGUEZ,                                       Chief Judge.

             Defendants-Appellants.


                                        ORDER

        These cases are before the court after a limited remand to the district court
pursuant to our decision in United States v. Paladino, 

(7th Cir. 2005).
In a comprehensive and thoughtful reply, the district court has informed us that, had
it known that the United States Sentencing Guidelines were not mandatory when it
first imposed sentence, it nevertheless would have imposed the sentence that it did.
In reaching this decision, the court clearly recognized its obligation to apply the
sentencing factors enumerated in 18 U.S.C. § 3553(a). It also reviewed the
transcripts of the original sentencing hearings.
Nos. 02-3584 & 02-4344                                                           Page 2

       Furthermore, the court specifically confronted the reasons tendered by each
defendant as to why a lesser sentence was appropriate and rejected those
submissions. Moreover, it gave specific reasons why each defendant deserved the
sentence imposed. It noted the Mr. Rodriguez had played a significant role in the
offense. He had introduced the confidential informant to the other defendants; he
had provided the confidential informant with samples of the narcotics. He also had
attempted to intimidate a witness in this case. Finally, the district court noted that
it had considered Rodriquez’ personal characteristics, including his history of mental
illness.

       With respect to Mr. Castillo, the court noted that it had considered his
personal characteristics and personal history and had determined that the imposed
sentence reflected the seriousness of the offense, respect for the law and provided a
just punishment for the offense.

       Before us, the defendants now submit that the sentences imposed by the
district court are not reasonable. They argue that the district court failed to consider
whether a sentence reflecting the disparity between crack and powder cocaine found
in the Guidelines was appropriate. We cannot accept this argument. In its
memorandum opinion, the district court wrote:

      Additionally, this court does not wish to engage in a consideration of the
      question of the punishment of crack verses powder cocaine but instead
      believes that it should follow the Sentencing Guidelines as established by the
      Sentencing Guideline Commission. See United States v. Gipson, 

,
      337 (7th Cir. 2005) (holding that a district court is not required to impose a
      sentence outside of the Guideline range based on the crack verses powder
      cocaine differential).

We believe that this passage, fairly read in its entirety, makes clear that the district
court understood that it had the authority to impose a sentence that departed from
the formulation found in the Guidelines but chose not to do so. The district court’s
reliance on our decision in United States v. Gipson, 

(7th Cir. 2005), in
which we held that a sentencing court need not depart from the Guideline’s
formulation, makes clear that the district court can depart if the circumstances of a
particular case so require. Indeed, by accepting the Guidelines’ formulation as the
starting point of the inquiry, the district court simply anticipated our recent decision
in United States v. Miller, 

(7th Cir. 2006).

      Sentences within the properly calculated guideline range are presumptively
reasonable. The sentences imposed in this case are within that range and were
confirmed by the district court during the Paladino remand only after careful review
Nos. 02-3584 & 02-4344                                                            Page 3

of the record. Accordingly, we hold that the sentences imposed are reasonable.

        We turn briefly to another matter. In our prior opinion, we noted that the
district court needed to clarify that repayment of the $3,000 “buy money” is a
condition of supervised release. In its order, the district court also noted that, in its
consideration of the sentence in the Paladino remand, it did not address the error
that we had noted in our opinion because it believed that our retention of jurisdiction
during the Paladino remand prevented such action. The district court was correct in
its estimation. This matter can be addressed in due course upon the termination of
proceedings in this court and the receipt of our mandate by the district court.

       The judgment of the district court is affirmed in all respects except that the
district court is directed to clarify that the $3,000 “buy money” is to be repaid as a
condition of supervised release.

                                                                   IT IS SO ORDERED