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I drilled a 1/8" pilot hole first with a step bit. Then finished it with a 1/8" twist bit. Next I ran a 3/8" bit down the pilot hole and used a second step bit to expand the 3/8" hole to 1/2". In this picture you can see that some of the holes are finished at 1/2" and some are still stepped, only the top bit is 1/2".
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