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In this paper, we outline a new connection admission control and online traffic engineering framework for small networks using differentiated services. Decisions are made at the edge routers of the network. Multiple label switched paths are set up between each pair of edge routers. When a new connection arrives at an edge router, each path is evaluated to see whether it is able to carry the connection. Then, the best path of the remaining ones is picked. The evaluation of paths is based on state information gathered from the queues on each path. We show the results this scheme achieves based on simulations.