Agribusiness

Beth Bechdol is the Director of Agribusiness Strategies at Ice Miller LLP and is responsible for assisting and coordinating the Firm's Agricultural Law Initiative.

Ice Miller is proud to have joined so many others last week in Indianapolis to show support for the National FFA and its student leaders. Ice Miller's relationship with FFA began just four years ago, but our commitment to its mission and efforts is deep. We judged outstanding student competitions - including the Star in Ag Placement and the Diversified Livestock Entrepreneurship proficiency. We led workshops on the Farm Bill and how to pursue advanced studies and even a career in law. And, we hosted many of the other industry partners who share our commitment to these talented students.

It is the very positive impression made through National officer visits and other meetings with so many FFA members that has pushed us to do more for FFA. Consider just a few of the talented officers we have met:

• Paul Moya was an '08/'09 National President and is finishing his degree at Notre Dame and considering a career in law;

• Riley Branch is another '08/'09 National officer who is in his first year at Texas Tech Law School; and

• Alex Henry was a National officer last year who shared her career goal of someday becoming the Secretary of Agriculture.  

The efforts and aspirations of so many other FFA officers and members clearly deserve recognition as well. I mention these three because they have inspired Ice Miller to help FFA develop the next generation of talented leaders who will become lawyers, business executives, policy makers and government leaders. 

Today's food and agriculture industries continue to develop and refine complex strategies to address market, business and weather related risks. Increasingly, though, the industry is challenged with burdensome policy and regulations that pose a significant threat. As this trend is likely to continue, our future leaders need to develop the tools today to critically evaluate these issues and to learn how to deal with and, where possible, shape them.

At Ice Miller, we remain committed to helping open these young minds. We do this by relaying the importance of basic legal services, such as business or farm estate planning or intellectual property protection – many of their own successful start-up businesses could already use these services ... by debating the merits of today's farm subsidies with them and brainstorming new policy ideas for their future ... and by candidly sharing what it takes to get through law school and what to do with that degree once you have it!  

In a time when our overall jobs and employment outlook remains quite challenging, it is refreshing to think of the immense opportunities for young people in agriculture. The students of the FFA will be a part of an agriculture industry that will feed the 7 billion people on our planet, improve human health, create new sources of energy and help care for our planet's environment. Ice Miller is extremely proud to support this great organization and its talented young leaders. 

I had the distinct privilege of moderating a Farm Bill Listening Session hosted  recently by Senator Richard Lugar and Congressman Marlin Stutzman in Fort Wayne.  The event had over 125 attendees with a variety of personal and policy interests represented - there were farmers, conservationists, hunger and nutrition advocates, home builders, rural and agribusiness leaders, engaged citizens and lots of press!

Both Lugar and Stutzman come from farming, both serve on their respective chamber's Agriculture Committee, and well understand its importance, the challenges it faces and the complexity of a farm bill process.  Both remarked on the critical timing agriculture faces in relationship to the work of the House-Senate debt reduction committee.  While Congress typically takes many months to study, debate, argue, and ultimately renew a farm bill, it was Lugar who candidly told the audience that the Farm Bill could be done in a matter of weeks ahead of the debt committee's deadline this Fall for budget cut recommendations.  Because of the time crunch, the 12-member panel “might make decisions about agriculture that are not formulated by the ag committees in the House or the Senate, that are not informed by listening and speaking to groups such as this one,” said Lugar.

The two political leaders were largely in agreement on agriculture policy and related topics that were raised or questioned by audience members.  Both preferred federal “safety net” insurance over direct subsidies as a way to protect producers against drops in commodity prices.  Both supported an examination of nutrition and feeding programs to consider their reform rather than simply "tweaking" eligibility requirements.  Stutzman favored ending federal aid for ethanol production. Lugar endorsed the ethanol blender tax credit to encourage development of the fuel made from corn.  Both supported the passage of pending free trade agreements with South Korea, Colombia and Panama.

The session was notable in two important ways - first, it was well structured to allow every attendee to ask a question or offer an opinion.  Both members' staff deserve compliments for not turning the event into a "hearing" with select witnesses and testimony.  Second, both Lugar and Stutzman offered very genuine and straight-forward responses to all the questions and topics raised - an approach the attendees seemed to really appreciate.

My opening comments that provided some "Farm Bill 101" for the audience are provided below.

"We are here today to hear from both Senator Richard Lugar and Congressman Marlin Stutzman of this 3rd district on the status, priorities, and even political dynamics surrounding the development of our next Farm Bill. Both will be intimately involved in this process – serving respectively on the Senate and House Agriculture Committees.

And you are an important part of today’s time together – both are expecting to hear your comments and perspectives on the Farm Bill – I hope you have come ready with opinions (probably strongly held ones!), comments and questions.

Before I introduce these two gentlemen to you, I’d like to share a little background and history with you on the Farm Bill and the process we go through to put new ones in place…

• 16 farm bills have been enacted in our nation’s history – the first in 1933 and the most recent 2008;
• Each bill is comprised of titles (similar to "chapters") – in 1996 there were 9 titles, 2002 there were 10 and our current bill has 15;
• The 2008 Farm Bill on average costs or provides outlays EACH YEAR of approximately $60 billion. Nearly 80 percent of this Farm Bill spending goes toward nutrition and domestic feeding programs;
• Two primary committees are involved – the House and Senate Agriculture Committees – but so are a number of others today because of the breadth of programs encompassed in this bill – including Foreign Relations/Foreign Affairs, Environment, Food Safety, Ways and Means/Finance. And that doesn’t even include the all important budget and appropriation committees who are squarely focused on the spending aspects;
• The Senate Ag Committee has 21 members (11 Ds/10 Rs); the House Ag Committee has 46 members (26 Rs/20 Ds), but 23 are new members. Other influencers are the Executive Branch (the White House and USDA) as well as a GROWING number of advocacy groups – they range from farm to hunger to environmental to rural to trade to research to consumer groups.
  

Every Farm Bill’s outcome is influenced by several common factors such as the state of the farm economy, the politics of the day, the strength of the lobbies involved, the structure/demographics of US agriculture, and always the budget.

Today, the budget crisis, the fragile U.S. – and European – economies, and the tremendous acrimony and gridlock in Washington will be key drivers of this process.

And, all of these, unfortunately, come at a time when today’s agriculture is challenged by levels of market volatility never before experienced, is threatened by increasing regulations and lawsuits, is "misunderstood" by a growing segment of our non-farm or rural friends and neighbors, and is expected to remain competitive and productive in global markets so we can help meet the challenge of feeding the 9 billion people on this planet in the next 50 years.

Now is a time when agriculture – and every other interest – admittedly must rise to the occasion and contribute to a solution to this budget situation. However, as we all begin today’s conversation, let’s collectively not lose sight of the critical need for GOOD, SMART and FORWARD LOOKING PUBLIC POLICY – and that means farm, rural, environmental, nutrition, trade, infrastructure, energy, and food safety policy to name a few.

Senator Lugar, Cong. Stutzman and their colleagues have a Herculean task ahead of them – it is our responsibility to participate, engage and offer input to this process too. And, that is why we are here today – thank you again for coming."

I had the great opportunity yesterday to spend the day with nearly 50 outstanding young farmers from all across the country participating in FFA's New Century Farmer Program.  These young leaders are spending an entire week together learning about the challenges they will face in the coming decades and how to remain successful.   The program introduces participants to the latest developments in agricultural technology, helps them to form relationships with top industry professionals, encourages them to engage in agricultural policy and helps them create a vision for their future goals and farm operations.

I led a session on food and agricultural policy that was followed by intensive group discussion on this group's thoughts on the upcoming Farm Bill.  We began with an overview of what food and agricultural policy is and government's role in formulating it.  The group was very interested in how federal farm policy is formulated, who are the players involved and what considerations go into crafting each Farm Bill (i.e., the state of the farm economy, the structure of agriculture, the size of the federal budget deficit, etc.).

This discussion was part of a larger process FFA is undertaking this year to provide input on the coming Farm Bill to U.S. Department of Agriculture Secretary Tom Vilsack.  Secretary Vilsack challenged the FFA student leadership last Fall to engage in the Farm Bill deliberations and share their unique perspectives as the future leaders of U.S. agriculture.

Ice Miller is a proud to represent the interests of the National FFA and be a sponsor of their student leadership programs.  We look forward to engaging with these talented young people through what will surely be long and successful careers.

Kristina Tridico, partner and member of the agricultural law team at Ice Miller LLP, authored this blog.

Beth Bechdol and I participated in Farm Journal's Top Producer Summer Seminar in Moline, Ill on June 7-8, 2011. The audience of 130 was mostly commercial, full-time farmers from across the country (mostly from the Midwest).

I led a breakout session on agricultural legal "pitfalls" and focused primarily on critical environmental regulatory issues for agriculture. I also spent time describing more positive opportunities for producers with on-farm alternative energy projects, including wind, solar, biomass and others. The PowerPoint presentation from the session is available below for reference.  The discussion on enhanced regulatory scrutiny of the agriculture industry was timely, as news sources reported today that Nebraska Senator Mike Johanns, speaking on the floor of the U.S. Senate, has questioned the sincerity of the Environmental Protection Agency over a campaign the Senator is calling EPA's "Charm Offensive." According to Johanns, as reported by Hoosier Ag Today, "the problem is what the EPA is selling publicly to farmers and ranchers just doesn't match up with reality. They say one thing on the road while the regulatory train just continues to barrel forward in Washington."

The overall themes of the conference sessions centered on how farmers should plan for the future - whether it be in business management, risk management, commodity marketing, access to credit and financing, regulatory compliance, or estate and succession planning. It was clear from our conversations with producers that estate planning and corporate and tax restructuring are front of mind and can be seen as overwhelming efforts. This is something we hear frequently from our clients as well. For more details please visit the firm's farm restructuring and estate planning services web site.

We look forward to being a part of future Farm Journal events and conferences. After 135 years of providing quality information to farmers, they clearly know and appreciate the issues most critical to success in farming.

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Agribusiness

Agricultural Law

I have had the privilege the last two years to serve on the Steering Committee for the Indiana Humanities Council's (IHC) Food for Thought Initiative. IHC has convened an enthusiastic and diverse group of partners to develop the multi-year Food for Thought Initiative. They recognized that the need for food links all of us, but the food we eat, the way we grow, prepare and eat it, our mealtime rituals, traditions and conversations…all of these elements distinguish us as cultures and individuals.

Food for Thought is an examination and celebration of the ways food helps to define Indiana’s culture, considering food in the context of history, law, politics, science, the arts, religion, ethnicity and our place in the world. Through this program, Hoosiers have shared and sampled the cultures reflected at the state’s table and addressed the local and global issues of hunger, nutrition, food production, obesity, food security and safety.

There have been numerous events connected to Food for Thought, including a one-night community conversation about food and ethnic identity called Chew on This. More than 150 people met at one of nine locally-owned restaurants for the fun evening full of diverse views and opinions. Last Fall, IHC joined with Spirit and Place and several sponsors including Ice Miller and hosted an evening conversation with internationally recognized chefs, Anthony Bourdain and Eric Ripert.

There also is a traveling exhibit designed to engage and educate Hoosiers about global and local food issues, increase awareness about Indiana’s rich agricultural history and stimulate conversation among families and communities. The exhibit will be traveling across the state this summer and is well worth the visit. The summer schedule is below.

June 4 - 19: Randolph County Convention & Visitors Bureau, Winchester

July 19 - Aug. 3: Knox County Public Library, Vincennes

Aug. 5 - 21: Indiana State Fair, Indianapolis

Aug. 30 - Sept. 8: West Lafayette Public Library, West Lafayette

Sept. 10 - Oct. 2: Evansville-Vanderburgh Public Library, Evansville

At a time when there is much debate over the "right kind" of food or the "right kind" of agriculture, IHC has motivated Hoosiers to think about ALL kinds of food and agriculture. There's a lot more "food for thought" on IHC's website at http://www.indianahumanities.org/foodforthought/.

Over the years, the interest in agritourism has grown. The popularity of farmers' markets is high. Families look for activities which are educational and entertaining, many of which include visits to farms and ranches. Further, with the continued focus on exercise, outdoor activities such as hiking and trail riding are popular. However, although the interest in these activities is generally viewed favorably, the increased number of participants, many of whom are inexperienced, means an increase in the potential liability to the providers of these agritourism activities. Starting this summer, agritourism providers can now take a few simple steps to limit the potential liability they may face from the inherent risks of agritourism activities. In Indiana Code Section 34-31-9, effective July 1, 2011, the Indiana General Assembly created a safe haven for agritourism providers who provide a statutory warning to participants and meet other specific requirements

The protections provided by this new statute apply not only to traditional activities at agricultural, horticultural, or agribusinesss operations where the general public is allowed or invited to participate in, view or enjoy the activities for recreational, entertainment, or educational purposes and animal exhibitions at an agricultural fair, but also to a broader range of natural resource based activities and attractions. Ind. Code Section 34-31-9-2(1)(2)(3). Essentially, the statute limits liability which may arise from the "inherent risks of agritourism activities." In the statute, inherent risks are defined as "those conditions, dangers, or hazards that are an integral part of an agritourism activity." Ind. Code Section 34-31-9-4.

In order to fall within the safe haven created by the statute, a warning sign must be posted which includes specific language about the potential risks. The sign must be visible from the main entrance and contain lettering of a specific size. Alternatively, all participants can sign a release containing the same warning language. If all of the statutory requirements are met, then a participant or his/her representative cannot make a claim for injury, loss, damage or death, caused by the inherent risks of an agritourism activity. However, as with any statute, there are exceptions and exclusions. For instance, this statute does not limit liability for injuries caused by improperly trained employees or due to a known dangerous condition on the land which is unknown by the participant.

So if you operate a pumpkin patch, have land with hiking trails or may be otherwise involved with agrotourism, you will want to take the steps needed to meet the requirements of this statute so that your business can take advantage of all of the protections which it affords. Further, you should also be prepared to address the exceptions - through well documented training sessions of employees, discussions of potential risks with participants, and other steps.

Ice Miller's agricultural law group monitors this and other similar issues for clients in the food and agricultural industries. View our full list of services at our agribusiness website. If you would like to further discuss this new statute or how to implement these statutory protections, please contact Judy Okenfuss at judy.okenfuss@icemiller.com or (317) 236-2115.

Anthony Aaron, partner and member of the agricultural law team at Ice Miller LLP, authored this blog.

By the year 2050, experts predict that the world's population will grow to over nine billion people and we will need to double food production. At the same time, many American consumers, particularly "early adopters" (thought and opinion leaders who seek information and frequently drive change) seem concerned that modern agriculture is not "farming" and express their preference for food produced locally, by organic methods or by other means that are not sufficiently scalable to feed the world.

On May 9 and 10, I attended the Center for Food Integrity's North American Strategy Conference on Animal Agriculture at Hamburger University in Oak Brook, Illinois. The conference brought together a group of organizations and companies who engaged with consumers, reporters and "mommy bloggers" to better understand their perspectives and how to bridge the gap. Many of the panelists were "early adopters" on food issues and expressed their preference for local or organic foods and for shopping at Whole Foods or farmer's market – in other words, food sources that many would not equate with "modern agriculture." At the same time, several panelists expressed a desire to feel a connection with their food by getting to know the producer personally at a farmers market, by having a garden or even visiting a farm.

Charlie Arnott, the CEO of Center for Food Integrity (CFI), also reviewed some of CFI's research on the attitudes of early adopters toward the food system. One of CFI's findings that left me deeply puzzled is that only half of early adopters are "very concerned" with having enough food to feed the U.S. and only 31 percent are "very concerned" with having enough food to feed the developing world. Yet, with the world's population headed to nine billion by 2050, and needing to double food production in the same time frame, we are faced with a choice of whether or not to produce enough to feed the world – and if we choose not to, the consequences could be dire.

The closing speaker was Ted McKinney, Elanco Animal Health's Senior Director of Global Corporate Affairs. He described affordable food, food choice and sustainable global food production as three rights that must be recognized in order to make the dream of providing nine billion people with safe, affordable and abundant food a reality. So, it seems that our challenge is to convince policymakers and consumers that we need to produce enough food to feed the world, while preserving consumer's right to choose the foods that fit their lifestyles and means. As Vanessa Druckman, one of the blogger panelists, put it, "We need to find food selections that work for the entire world, not just people like me who can choose to buy organic and grass-fed."

Ice Miller is a proud sponsor of many CFI events and routinely participates in its conferences to stay abreast of its research and information, as well as other research, information and policies affecting agriculture and agribusinesses. If you're interested in seeing more of the conference discussion, check out #CFI11 on Twitter.

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Agribusiness

Agribusiness Law

Jennifer Johnson, associate in the business litigation group with a focus on product liability at Ice Miller LLP, authored this blog.

Last week I attended the Association of Equipment Manufacturer's Product Liability seminar in Bloomingdale, Ill. The seminar focused on how technical personnel and corporate representatives of equipment manufacturing companies and outside counsel can work together during litigation proceedings for effective litigation tactics and strategies. The topics ranged from coordinating litigation on a national scale to the important role corporate representatives can take in alternative dispute resolution. Some of the key themes which emerged are:

• The importance of a well-organized litigation program at the corporate level. One speaker highlighted the challenges emerging from cooperation and organization of the plaintiffs' bar. For example, many plaintiff's attorneys' associations maintain forums on specific products where the attorneys can share common claims involving a product, document libraries where attorneys can share successful pleadings, and deposition repositories that attorneys can use to research a corporate representative in a matter. In order to combat this cooperation by the plaintiffs' bar, manufacturers need to coordinate their litigation on a company level to ensure that the manufacturer's discovery responses and other pleadings do not contradict those filed in cases in other jurisdictions. The plaintiff's attorneys are sharing these documents and will use them to surprise a corporate representative at deposition or trial. Manufacturers typically accomplish such coordination by employing internal litigation managers or product specialists, or by employing national counsel.
• Recent changes to the Federal Rules of Civil Procedure may benefit manufacturers, specifically changes to Federal Rule of Civil Procedure 26, which governs expert witness discovery. The new version of Rule 26 will provide more protection to communications between counsel and a testifying expert witness. The most relevant changes include that draft expert reports and communications relating to an expert's opinions will no longer be discoverable by the other side.
• Deposition preparation should begin early in a matter. This perspective highlights the importance of, an incident reporting network. After an initial meeting with counsel, the corporate representative should learn why he or she was selected to serve as corporate representative, whether there are any deadlines he or she needs to be aware of, the time frame in which the deposition is likely to occur, and the number of documents that the attorney anticipates the corporate representative will need to review. After this meeting, the corporate representative should have a good sense of whether he is the right witness. If so, the representative should expect to meet with counsel at least one more time where the "nitty gritty" details of the case will be discussed. Corporate representatives should be proactive in preparing for depositions and should not hesitate to contact counsel with questions or concerns.
• One speaker noted that it should not be the objective of the corporate representative to "win" the deposition or trial. Rather, their demeanor should reflect that they are trying to be helpful by educating the jury and/or opposing counsel. Thus, it is important to use basic terms that anyone can understand and to maintain a calm presence in front of the jury or, in the case of a videotaped deposition, the videographer.

Ice Miller represents a number of clients on product liability matters, including those in the agricultural and construction equipment industries. For help or more information about how Ice Miller can assist your business with additional background on the litigation process and the important role corporate representatives and technical personnel play in it, please contact Jim Petersen, Judy Okenfuss, or Jen Johnson.

Post Tags: Agribusiness, Agriculture Law, Product Liability, AEM Conference 2011.

Ice Miller LLP announced today, April 5, that Beth Bechdol has been elected to the Board of Directors of the National Grain and Feed Association (NGFA). The organization elected 18 industry leaders to serve on its 58-member board of directors during the organization's 115th annual conference in San Diego, Calif.

Read the entire announcement.

Earlier this year, the Western Farm Press publication interviewed Roger McEowen, director of Iowa State University’s Center for Agricultural Law and Taxation (CALT), about his thoughts on the most significant agriculture-related legal developments of 2010.  Many of these involved court decisions while others were legislative or regulatory actions at the federal level.   The list is a diverse one and highlights biotechnology approvals as well as environmental, depreciation, tax, livestock marketing, and food safety issues, among others.  Read the entire list of top 10 farming related law stories of 2010. 

Never in history has so much been required of agriculture.  In addition to the ever-present mission to feed the world, agriculture is expected to help mitigate climate change, develop alternative energies, improve human health and create new sources of food and nutrition. 

In just 50 years, the over nine billion people then living on this planet will require 100 percent more food than is needed today.  Translation:  agriculture will need to produce in that same time period twice the amount of grain, livestock and other products.  

Because of environmental and practical limitations, there is simply insufficient high-quality land to just "grow" or "raise" more food.   According to the World Bank, there is at most 12 percent more arable land available for food production that isn't presently forested or subject to erosion or desertification.  There also will be significant limitations on water availability in the future.  By 2050, it is estimated, four billion people, eight times as many as today, will be living in countries with chronic water shortages.

The United Nation's Food and Agriculture Organization reports that new farmland could meet 20 percent of this new food demand and increased cropping intensity may yield another 10 percent.  The remainder – an overwhelming 70 percent of the additional world food needs – must come from technology and innovation.

Technology advancements and corresponding productivity gains in agriculture across the 20th century were remarkable and arguably prevented major famines or devastating food wars.  Consider the following:

• Corn yields in 1910 were about 15 bushels to the acre.  In 1960, they were 55 bushels per acre, and today, they are well over 160 bushels – a 300 percent increase in just the last 50 years.  Wheat and soybean yields have seen 215 percent and 169 percent increases in that same 50-year period.  

• The livestock sector, too, continues to provide more high-quality protein using fewer resources.  The U.S. dairy industry produces nearly 60 percent more milk with 64 percent fewer cows than it did some 65 years ago.  And, the same trend holds for pork.  Compared to 1950, U.S. hog farmers produce 176 percent more pork per sow with 44 percent fewer sows.

• A century ago, each U.S. farmer's production fed only a dozen or so people.  Today, the average U.S. farmer feeds 155 people.

Our next set of great challenges, though, will require even greater solutions and must come not only from the U.S. but from around the world.  Investment and commitment to these three unique, yet inter-connected, areas are especially critical to our problem-solving.

Read Beth Bechdol's entire article that was published in Nebraska Pork Talk.

The National FFA Organization is celebrating National FFA Week this week (Feb. 19-26, 2011). "Infinite Potential" is the theme this year and the organization's 500,000-plus members are encouraged to envision, discover and achieve their potential within their communities. 
 
The week of George Washington's birthday was designated by the organization as National FFA Week in 1947 because of the first President's contributions to agriculture, his diligent work ethic, honest character and record keeping...all skills taught through FFA's programs. 
During the week, national officers will travel to different parts of the country to visit FFA members, participate in special events and meet with leaders of the agriculture industry. Individual chapters initiate events throughout the week to promote FFA and agriculture in their classrooms and communities. Events include community service projects, educational lessons for elementary students and promotional programs for students, teachers, and alumni.

Ice Miller is a proud supporter of National FFA and its outstanding student leaders.  Beth Bechdol, Ice Miller's Director of Agribusiness Strategies, serves on the 2011 FFA Sponsors' Board.   Follow National FFA on Facebook, Twitter and FFA Nation. Visit http://www.FFA.org to learn more about the National FFA Organization.

Ice Miller ag team members, Kevin Alerding, Tony Aaron and Beth Bechdol, participated in an Agribusiness Retreat hosted by Kennedy and Coe LLC in Indianapolis February 8-9, 2011.  Kennedy and Coe LLC is based in Kansas and Colorado and is a Top 100 accounting and consulting firm.  They offer tax, financial and management succession services to farming operations across the country.
 
Beth Bechdol presented on current agricultural political and policy developments, including the upcoming Farm Bill debate and EPA's expanding regulatory approach to agriculture.  Click here for her powerpoint presentation.
 
Kevin Alerding is a partner in Ice Miller's Personal Services group and is experienced in farm succession planning.

Tony Aaron is a partner in Ice Miller's Business group and assists farm and agribusiness clients with corporate transactions and restructuring.

The new year brought good news to the food industry as different courts issued opinions rejecting consumer claims that would likely have had significant impact on the food industry.

In one case, a consumer filed a class action based on an allegation that a product is dangerous and an assertion by the plaintiff that he, and other consumers like him, would not have purchased the product if the manufacturer and sellers of the product had disclosed its dangers.

Another class action was based upon allegations that a product's labels and marketing misrepresented the product's quality or characteristics.

Read the entire article about food companies defending class actions.

The U.S. Department of Agriculture (USDA) made two announcements in recent days from Copenhagen, Denmark as the United States and delegates from 191 other countries meet at the United Nations Climate Summit. Secretary of Agriculture Tom Vilsack released a USDA report outlining the agency's calculated impact of climate change on U.S. ecosystems. "The Effects of Climate Change on U.S. Ecosystems" report concludes that climate change affects U.S. agriculture, land resources, water resources and biodiversity and describes in some detail more specific projected impacts on grain and oilseed crops, horticultural crops, and livestock, among others. Vilsack referenced carbon offset markets as a means to help the country become energy independent, to reduce greenhouse gas emissions and to create income generating opportunities for rural America. USDA's analysis of the climate change legislation passed by the U.S. House of Representatives shows it provides a net gain for farmers and ranchers, with revenue from a carbon offset market offsetting increased farm expenses.

A complete copy of the report is available at the following link: http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB?contentidonly=true&contentid=2009/12/0611.xml.

Over the last several months, many of the leading agriculture commodity organizations have challenged this specific analysis by USDA, arguing the costs to farmers and ranchers far outweigh the calculated revenue from carbon markets. Today, though, USDA announced a unique partnership with U.S. dairy producers who have agreed to accelerate their adoption of waste to energy technology projects. The Memorandum of Understanding, signed by Dairy Management Inc.'s Innovation Center for U.S. Dairy and USDA, committed the industry to reach a 25 percent reduction in greenhouse gas emissions by 2020. The partners will increase the number of anaerobic digesters (which convert manure into electricity) supported by USDA programs and also encourage research and development of new technologies.

U.S. Secretary of Agriculture Tom Vilsack made a tour through Indiana on June 3, primarily to tout the Obama administration’s plans to rebuild and revitalize rural America.   He made three stops in Indiana: Terre Haute, Indianapolis and Danville.  The most interactive of the stops for Indiana residents was in Danville, where the secretary held a forum (part of USDA's Rural Tour) to collect ideas and comments from local residents on how best to revitalize the rural economy.

Vilsack outlined the goals of the American Reinvestment and Recovery Act – providing  assistance to struggling families; investing in the nation’s transportation system; and building “green collar” jobs.  He acknowledged that families are struggling because of the economic crisis.  In rural areas, Vilsack pointed to a few specific areas of relief provided by the stimulus funds, including infrastructure in watershed areas to reduce flooding and promotion of renewable energy production to revitalize local economies.

Rural community residents, ag organization and business leaders in attendance asked the secretary questions on a variety of topics… the struggle to feed a growing world population, the regulatory environment and wind energy issues were just a few.  Another topic though dominated the conversation and also provide the insight into the administration's priorities in agriculture – structural changes in U.S. agriculture and USDA's plans for assisting small farmers.

This has been a recurring theme for Vilsack following the release of the 2007 Census of Agriculture.  Referencing three different segments of producers ("large" farms that produce 75 percent of the nation's output; mid-sized farms and small farms), the secretary outlined priorities primarily for the latter two groups.

Mid-sized farms, he noted, are decreasing in number because they are either being purchased by larger farming operations or are dissolved because they are no longer able to compete in the industry.  USDA and other federal programs will promote job creation in local areas to provide alternative job opportunities for those farmers.

Small farms, on the other hand, are a growing segment and one that USDA will attempt to help more because of the "job opportunities they create in rural America."  How will USDA help these smaller operators?

1. Expansion  of the beginning farmer program
2. Connecting local consumers and local producers to establish more market opportunities for farm products. 
3. Expanded conservation programs will help farmers more efficiently use their land.
4. Increased focus on biofuels,  expanded trade, and climate friendly programs will also create more opportunities for small farmers.

These comments provide much needed reassurance and promises of support to rural communities hard hit  by the current economic downturn.  At the same time, they also foretell a significant shift in USDA focus and programming away from the largest, most productive farms to smaller farms seeking more localized expansion opportunities.  It is still early in this administration's term and so difficult to predict precise directives or outcomes, but it is clear that Vilsack has yet to waver from this theme and these new priorities.

Getting work done by independent contractors is very common, especially for those in the agricultural industry.  Whether one is contracting for a small job like painting a barn, or a larger job like building a tool shed or grain storage bin, it is important to understand the liability risks involved with those very common contractual relationships.

In a recent case, the Indiana Court of Appeals highlighted the risk that individuals face in their professional and private lives when contracting for jobs valued at more than $1,000.  The Court of Appeals found that the Indiana Worker's Compensation Act places liability on the person who lets such a contract (the "statutory employer") under certain circumstances.

The Act states that when the statutory employer - a farmer, for example - hires someone to do a job valued at more than $1,000 the statutory employer will have to pay the worker's compensation benefits if (1) there is an injury to the contractor's employee; (2) the contractor does not have worker's compensation insurance; and (3) the person contracting for work to be done has not obtained a certificate on the contractor from the Indiana Workers' Compensation Board.  This is commonly called the "statutory employer's liability."

In the case, a farmer hired a contractor to paint a house and barn.  Although the legislation exempts work done on one's personal residence only, this job involved the house and barn, so the exemption does not apply.  The farmer did not obtain a certificate from the Indiana Worker's Compensation Board showing that the contractor had worker's compensation insurance.  An employee of the contractor was injured on the job and the contractor did not have worker's compensation insurance.  The employee demanded worker's compensation benefits from the farmer.  The farmer sought coverage under his personal liability policy, but that policy excluded benefits that are required to be paid under worker's compensation law.  The insurance company successfully argued that the exclusion, a common exclusion in liability policies including most homeowner's and business liability policies, precluded any coverage to the farmer for the injured person's worker's compensation benefits.  Therefore, the court held the liability insurance policy did not provide coverage for the farmer for any amount he had to pay to the injured worker.

Therefore, to avoid personal and business risk, one must obtain a certificate from the Worker's Compensation Board showing that the contractor has worker's compensation insurance.  A certificate signed by an insurance agent will not be sufficient to mitigate liability in the event that an injury occurs and the contractor does not have worker's compensation insurance.  Also, if you have worker's compensation insurance for your operation, you should check whether that policy may provide coverage for this situation.  Finally, see if you can get contingent worker's compensation coverage on your farm's liability policy.