Alternative Energy Technologies

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.

Post Tags:

Green Initiatives

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.

Post Tags:

Agribusiness

Agricultural Law

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.

On Oct. 6, 2010, the Federal Trade Commission (FTC) published a notice soliciting public comment on proposed revisions to its "Guides for the Use of Environmental Marketing Claims" (commonly known as "Green Guides" or "Guides").  Companies may be affected by the FTC's proposed revisions if they advertise the "environmental attributes" of a product, package or service.

The FTC will consider and accept comments until Dec. 10, 2010, on the proposed changes, which include:

1. A caution to avoid claims of general environmental benefits.
2. A new section devoted to certifications and seals of approval.
3. Additional guidance for claims that a product is "degradable," "compostable" or "free of" a particular substance.
4. New guidance regarding the use of "renewable materials" and "renewable energy."
5. A new section regarding "carbon offset" claims.

If you would like to discuss the FTC's request for stakeholder input or any of the potential changes to the FTC's Green Guides, please contact Susan Charles or Kristina Tridico.  
       
Read the entire article that includes a summary of the proposed changes and a link to the text of the FTC's proposed revisions.

         On Sept. 16, 2010, the United States Environmental Protection Agency (EPA) published a notice in the Federal Register soliciting stakeholder input regarding the agency’s role under the Pollution Prevention Act of 1990 in regulating or encouraging the "green" or sustainable products movement.  The EPA will consider and accept comments until Oct. 19, 2010, on the scope and nature of the agency’s proposed role in the identification, development, manufacturing of, designation and use of "green" or "sustainable" products, as well as views on the major challenges and opportunities in this area.

         Companies may be affected by the EPA’s action on this matter if they manufacture, distribute, label, certify, verify and purchase or use consumer, commercial or industrial products that may be considered as "green," "sustainable" or "environmentally preferable."  Potentially affected entities may include, but are not limited to those industries with the following North American Industrial Classification Codes (NAICS):  23, 31–33, 42, 44, 45, 54, 72, 81 and 92.

         The areas contemplated by EPA for regulation or other action include: 

1.      Assembling information and databases;
2.      Identifying sustainability "hotspots" and setting product sustainability priorities;
3.      Evaluating the multiple impacts of products across their entire life cycle;
4.      Defining criteria for more sustainable products;
5.      Generating eco-labels and/or standards;
6.      Establishing the scientific foundation for these eco-labels and/or standards;
7.      Verifying that products meet standards;
8.      Stimulating the market; and
9.      Developing end-of-life management systems (reuse, recycling, etc.).

         If you would like to discuss the EPA's request for stakeholder input or any of the potential changes to EPA’s role in the "green" movement, please contact Kristina Tridico, Susan Charles or Freedom Smith.  In addition, you can view the Federal Register notice prepared by the EPA to summarize its proposed actions.

Study highlights from 2010 include the following

•  Corporate reputation is back on top as the highest ranked business issue. In 2009 the highest ranked issue was customer loyalty and retention.
•  Cost of living is still seen as the strongest advantage that Indiana has over neighboring states and has been on the rise as the strongest advantage since 2007.
•  CEOs appear optimistic about 2010. There is a stronger likelihood they will pursue adding jobs, green development, outsourcing, mergers and acquisitions, new alliances, and a variety of other forward looking or growth oriented activities, when compared to 2009.
•  CEOs continue to remain positive about Indiana’s ability to attract business to the state.
•  Perceptions regarding the strength of education programs in the areas of advanced manufacturing and alternative energy have increased since 2009.
•  CEOs report that workers lowest in demand are manufacturing, non-skilled and bio-tech/life science workers.

View the 2010 CEO Survey Full Report.

View the 2010 CEO Survey Excutive Summary.

Our 14 hour flight arrived in Shanghai and we immediately boarded a bus to Hangzhou, which is three hours to the southwest.

As we drove along the interstate it was interesting to see agricultural practices rooted in the past - with small ponds raising ducks and fish and tiny plots of land growing grains and vegetables being tended to by single farmers in wide-brimmed straw hats - surrounded by modern multi-lane highways and new housing starts.

Hangzhou, the capital of Zhejiang - Indiana’s sister province - is a city of over 7 million and has been ranked as one of Mainland China’s best commercial cities, due in part to its ideal location near Shanghai and being nestled in the Yangtze River Delta, which affords a wealth of international trade opportunities to the region. It is also known for being one of China’s “green” cities due to its investment in its environmental resources.

As business has flourished in Hangzhou, the city has earned a reputation as a center for information technology, software development and telecommunications equipment.

Hangzhou is considered a domestic and international tourist destination; in fact Marco Polo declared the city of  Hangzhou, “beyond dispute the finest and the noblest in the world.”  It is known for its lovely West Lake area, home to tea houses and water taxi tours.

Indeed, Hangzhou is a modern marketplace and we are eager to kickoff our trade mission with a meeting tomorrow morning at Zehjiang International Trade Group as we discuss agriculture, jobs and investment opportunities between Indiana and China.  Perhaps the message in my fortune cookie on the long flight over put it best:

“There are many new opportunities that are being presented to you today.”

The trade delegation visited Agra, India today.  Agra has a substantial industrial base.  Many manufacturing plants and industry related wholesale markets are prominent here.  In addition to learning about these economic contributors, we were also able to see first hand how the city handles tourism and its impact on Agra's economy.  We were able to visit one of the seven wonders of the world, the Taj Mahal, also known here as "the Taj."

The Taj Mahal has a very important role in the economic viability of Agra.  This magnificent masterpiece attracts from two million to four million visitors each year.  More than 200,000 of those visitors come from overseas.

The Taj Mahal was built by Emperor Shah Jahan as a mausoleum for his third (and favorite) wife, Mumtaz Mahal, who died during the birth of their 14th child.  Construction for the mausoleum began in 1632 and was completed in 1653.  It serves a reminder of the great love story between Shah Jahan and Mumtaz Mahal and what a beautiful reminder it is.

The mausoleum is made completely out of white marble.  The marble is translucent so that, depending on the time of day, it either reflects a pink or white hue.  Within the mausoleum, there are beautiful flowers and vines made up of precious jewels which come from all over the world.  When light hits the flowers, you can see all different shades of red, orange, yellow, green and pink.

The Taj Mahal is built along the banks of the Yamuna river and has two smaller castles on either side.  It is amazing.  I am astounded when I think of the amount of labor and craftsmanship it took to create this piece of art.

On our way to Agra we visited remote areas of India, which have a completely different standard of living than the large cities.  There are wild monkeys everywhere.  When we were at a stop sign or toll road, the monkeys would climb on our vehicle.  There are also wild boars and cows walking around.  Along the rural streets we saw things Americans are used to seeing inside of a home: sleeping, eating, taking a bath, shaving, washing clothes, getting a haircut.  There are a lot of vendors on the street who sell fresh fruit and vegetables.  Refrigeration isn't common in the rural areas, so the street vendors play an important role in supplying fresh produce.

The rural areas also don't have running water.  They use water from the rivers for their daily needs.  It's a very hot time of year and the rivers are very low.  Because of that, you can actually see the trash and pollution in the water.  That was very sad.

In some of the mid-sized cities, cows are in the middle of the road.  We had an interesting experience when a man came up to our bus playing his flute.  He was charming a snake to come out of its container.

I've blogged about some of my thoughts about India and its culture, but I also want to include comments from a few of my fellow delegates.

Bryce Bennett:
The delegation went to Agra today to look at tourism and how the economy can be improved by creating opportunities for employment in the tourism industry.  We saw the different sides of India along the way, from the grand Taj Mahal to the poverty in the slums and the unfortunate living conditions to the environment that has been spoiled along the Indian highways.  It has been a very rewarding experience to learn more about the Indian culture.  We look forward to bringing the ideas and thoughts that we have generated from our trip back to Indiana, and Indianapolis in particular, for the benefit of our citizens.

Sanjay Patel:
We took a trip to Agra today, leaving Delhi around  6 a.m.  From a large city, the nation's capital, we drove through the rural agricultural areas.  We saw the big city lights and were able to compare it to the rural life and heart of Indians working day in and day out just to make it.  We ended up at the Taj Mahal.  I've seen it twice before, but it was much more special this time.  As an adult I can appreciate the true history and architecture of it and the work that went behind it.  We've had the opportunity to really take in what this country stands for.  My parents are from India, so I've been here several times.  This particular trip has opened my eyes on the economic opportunities we can bring back to Indiana.

This morning the delegation met with the Confederation of Indian Industry, which is an entity similar to a Chamber of Commerce.  During this meeting we talked with the executive director of Mahindra, Arun Nanda.  Mahindra is a $6.3 billion company that employs over 100,000 people across the globe.  They manufacture and market utility vehicles and tractors.  They also have a significant presence in information technology (IT), financial services, tourism, infrastructure development, trade and logistics.  The company has three plants in the U.S. (Texas, Tennessee and Georgia) that manufacture tractors and they cater to what they call the "hobby farm market."

We then met with members of the Bombay Chamber of Commerce and Industry, and Dr. Atindra Sen, director general of the chamber. The chamber was established in 1836 and is the oldest chamber in India.  The chamber has 20 subcommittees that focus on different segments of industry such as legal affairs, agribusiness and international trade.

During my conversations with Indian business leaders I've observed that clean technology and "green" or environmentally friendly practices are not widely used in India.  This may be an opportunity for various industry segments within the U.S. to bring their expertise to this market.

What this market is very interested in is quality.  This has been a shift partly because labor costs are increasing and, as a result, product quality has become a focus. 

We've also talked a great deal about the Indian legal system.  In general, the legal system is not highly trusted and people believe someone's word is sufficient to reach an agreement.  The legal system is based on common law and has been largely influenced by the British rule, so it's very similar to our system; however, there are some differences.  They have no juries and no tort law.  Areas such as real estate, corporate, commercial or most types of business transactions are very similar to the U.S. which make it desirable for U.S. companies to want to do business here.  An interesting fact I learned about the court system is that the India Supreme Court is clogged with property cases and it would take approximately 300 years to handle all of the property cases on the current docket.

I referenced a study by Dr. Geert Hofstede on intercultural business communications in my last post.  One area he studied is the Power Distance Index (PDI).  The PDI is a reflection on how much a culture does or does not have hierarchical relationships and respect for authority.  As I've mentioned, India places great importance on hierarchy.  For countries with a high PDI, like India, the study says that people can expect to encounter more bureaucracy in organizations and government agencies.  The property case backlog in the India Supreme Court is a prime example of this indicator.

After the meetings, we went to the Gateway of India, which is a monument located on the waterfront in the Apollo Bunder area in South Mumbai.  The Gateway is an 85 foot high arch.  It was used by fishermen as a jetty and later renovated to be used as a landing place for British governors and other dignitaries.  The arch combines both Hindu and Muslin architectural style and is striking.

During my visit I've come to appreciate many beautiful aspects of Mumbai.  The city lies on the Arabian Sea and has stunning views.  The Bandra Worli Sea Link bridge enhances the beauty of this coastline.  The bridge was recently completed and took six years to build.  It is an operator billed bridge, which means an operator provides the capital to build the bridge and owns it for a certain number of years, possibly 10 years or more, and gets the toll money that then pays for the building of the bridge.

Although Mumbai is a beautiful city, the traffic and congestion hinder its appeal.  Traffic is so bad that very large corporations use helicopters to transport people locally rather than dealing with the traffic.  Because it's so crowded and congested, it's acceptable to be late for appointments, although it's more acceptable to be late when you're meeting with government officials than corporate leaders.  People also honk constantly.  Honking is not considered rude and is used as a way of letting someone know that they're close to you. 

So with all the stress from traffic, how do people relieve the tension?  One way is cricket.  Cricket is the number one sport in India and it's everywhere.  If you go by any park, there are always people playing cricket.  As I mentioned in my last post, it's summer here and the temperature is about 106.  It's incredibly humid and very hot and people are still outside playing cricket!

Just days before the United Nations Climate Change Conference in Copenhagen, Denmark, the U.S. Patent and Trademark Office (USPTO) initiated the Green Technology Pilot Program on December 8, 2009 to expedite the examination of "green technology" patent applications. By offering the program, the USPTO hopes to accelerate the development and deployment of green technologies, help create green jobs, and promote U.S. competitiveness in the clean technology sector. In the press release announcing the Pilot Program, the Under Secretary of Commerce for Intellectual Property and Director of the USPTO, David Kappos explained "Every day an important green tech innovation is hindered from coming to market is another day we harm our planet and another day lost in creating green businesses and green jobs."

According to its own statistics, the USPTO takes on average 30 months to issue an initial office action for green technology patent applications and approximately 40 months to make a final determination on the patentability of such applications. In the normal process, applications are taken up for examination based on their filing date. Recognizing that over a three and half year wait is too long in the green technology sector, the Pilot Program provides a mechanism for green technology patent applications to be advanced, out of turn, to examination without having to pay any additional fees or provide any additional examination support documentation. The USPTO estimates that this Pilot Program will reduce the examination time of these applications on average by one year.

The Pilot Program broadly defines the term "green technologies" as technologies that pertain to environmental quality, energy conservation, development of renewable energy resources, or greenhouse gas emission reduction. Despite this broad definition, the USPTO currently requires that a patent application be classified in one of 79 specific U.S. patent classifications outlined in the Pilot Program to be eligible.

The Pilot Program only applies to non-provisional utility applications filed prior to December 8, 2009 that have yet to be examined. Applications that are either filed after December 8, 2009 or already being examined are not eligible for the Pilot Program. The Pilot Program is set to expire on December 8, 2010 and the USPTO only guarantees that it will accept the first 3,000 petitions to make an application special under the Pilot Program. Thereafter, the USPTO will evaluate whether the Pilot Program should be extended based on the USPTO's workload and available resources. Thus, time is of the essence for those wanting to take advantage of the Pilot Program.

While there are limitations on the number and type of claims that can be included in the application and a requirement that an applicant waive its right to object to a restriction requirement, the Pilot Program does provide an inexpensive mechanism to expedite the examination of a green tech patent application. Such an expedited examination can prove beneficial to those looking to enforce their patent rights as quickly as possible and/or those looking for funding options.

The Official Notice of the Pilot Program can be found at 74 Fed. Reg. 64666 (Dec. 8, 2009) (See http://www.uspto.gov/patents/law/notices/74fr64666.pdf ) and the USPTO Press Release for the Pilot program can be found at www.uspto.gov/news/pr/2009/09_33.jsp.

If you have questions about the Green Technology Pilot Program, you can contact Alex Forman or Bill Lyon, members of Ice Miller's Intellectual Property Group.

Day 8 - Monday, September 14
We attended the opening ceremony of the Midwest U.S.–Japan Association Conference.  Mitch Daniels is one of three U.S. governors who is attending this conference.  Governor Jennifer Granholm of Michigan and Governor Jim Doyle of Wisconsin are in attendance as well.  There are four Japanese governors participating.

Several members of the delegation were able to meet privately with a representative from Sony.  He discussed that Sony's top issues right now are quality and the environment.  He also discussed the increased need for universities and businesses to collaborate more; specifically pointing out excellent programs at Purdue and Rose-Hulman that would be of importance to Sony.  This representative is happy with their Indiana connections and feels that Indiana strives to keep the costs of conducting business in the state low.

Overall, Japanese business leaders are looking to expand relationships throughout Asia and not rely so heavily on the U.S. and Europe  The current economic conditions that the U.S. and Europe are facing have impacted Japan because of their market presence.

Over the weekend Governor Daniels announced that beginning in 2010 the Indiana State Fair will feature a different country each year.  Japan will be the first country featured.  Japanese exhibits will include performing arts, cuisine, interactive displays and educational opportunities.

Day 7 – Sunday, September 13
Today was the first opportunity the delegates had to do some sightseeing on their own.  Some of the delegates visited Japanese shrines but I decided to do a bit of shopping in the "fashion capital of the world!" 

The Ginza District of Japan features many of the world's best designer shops as well as smaller shops featuring hand painted stationery, paper, umbrellas and fans.  The Japanese culture emphasizes order and cleanliness.  For example, you must take your shoes off when entering a dressing room and put a cloth over your face to protect the clothes.  On escalators, you hear instructions on which side to stand and reminders to hold small toddlers.

This emphasis on order and cleanliness even translates to their public restrooms.  The toilet seats in public restrooms are heated and all the restrooms have bidets.  Restrooms are easy to find and are on located on every floor.  There is a special deodorizing spray and you hear a continuous flushing sound to protect your privacy. 

In Japan you'll find that many stores have a lot of customer service representatives to assist you. In one small section of a department store I found 3-4 representatives designated to help customers in just that one section.

The Japanese stores tend to only carry three sizes: small, medium and large.  In America, I usually wear an extra small but in Japan I'm a medium. Most of the Japanese women are very slender and all are about the same height.  You'll find very little obesity among the Japanese.

Today's weather, beautiful, clear and in the mid-70s (similar to our Fall), gave me an opportunity to observe interesting aspects of the Japanese culture.  Even in the summer many Japanese wear boots.  As in China, pale skin is preferred and many of the women carry umbrellas.  Japanese society is very disciplined.  The city streets are clean and people don’t dress as casually as they do in the U.S.  For example, you don't find many people wearing flip-flops.

Sunday Evening
In the evening we attended the gala reception for the Midwest U.S.-Japan Association Conference in Tokyo.   For nearly three decades, business leaders from the Midwest region of the U.S. and Japan have met on an annual basis to discuss the growth and progress of economic relations of the American Midwest and Japan.  The Midwest U.S.-Japan Association is comprised of ten member states including Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, Ohio and Wisconsin.   Membership in the Japan-Midwest U.S. Association is comprised of corporations that have direct economic ties to Japan or are interested in developing them.  The association has some 100 corporate members including Toyota Motors, Mitsui & Co., Saison Group, Sumitomo Chemical, Kajima Corporation, and Sony.  The associations reinforce the economic, political and cultural ties that link the national economy of Japan with the regional economy of the Midwest.

Day 6 – Saturday, September 12
We traveled by bullet train to Tochigi Prefecture, Indiana's sister-state in Japan.  The bullet train was very comfortable and is an extremely efficient mode of transportation for the Japanese.  The train is low energy, low noise, seats a very high capacity of passengers and is easy to maintain.  The Japanese culture emphasizes order and you see that in their transit system.  Their average delay is less than one minute.  Everything is on time and there are no last minute changes.  Seventy-two percent of transportation is done on these bullet trains in Tokyo central and 56 percent in metro Japan.

When we arrived we attended a ceremony to celebrate the 10th anniversary of the sister-state agreement by planting a tulip tree, the official state tree of Indiana, in the central park of Tochigi.  This park is beautiful with many fountains and tulip trees.  The Japanese mentioned that the relationship between Tochigi and Indiana was fate.  Tulip trees were planted in this park 15 years before we became sister states and they feel there is strong significance in the fact that the tulip tree is Indiana's state tree.  These goodwill gestures were further endorsed by the fact that it was a rainy afternoon, but the clouds broke just as the planting ceremony began.

After the tree planning ceremony, we attended the 10th Anniversary Commemorative Symposium at the Tobu Hotel.  Over 100 Japanese government and business leaders attended this event.  Governor Fukuda, the governor of the Tochigi Prefecture, expressed his appreciation and his view of the importance of the delegation coming to Japan.  Personal connections are very important to the Japanese and these face-to-face visits are crucial to successful relationships.

After thy symposium, we attended a reception for the Indiana delegation which was hosted by Fukuda.  We were able to witness the tradition of the "breaking of the barrel."  Six Japanese officials broke a barrel, filled with Saki, with wooden hammers.

An interesting observation that I've made is that many of the roofs in Japan are "green."  The tops of the buildings have grass, trees and bushes.  Not only is this great for their environment, but it is a way for the Japanese to have yards in an area that is highly populated.

Our trip to China was a big success.  It was important for Indiana leaders to visit this country face-to-face and show the sincere interest in enhancing and creating business ties.  The size and scope of the delegation seemed to go a long way in making an impact during our meetings.

An influential Chinese businessman still has a token of Governor Orr's trip to China over 20 years ago sitting on his desk.  It was the last trade mission trip an Indiana governor made to China.  The importance of Indiana making this trip again shouldn't be ignored.

In addition to the wealth of economic and business benefits we've been able to establish, I have truly enjoyed observing and participating in many aspects of the Chinese culture.  As I mentioned in a previous post, tea is one of the traditions I have enjoyed learning more about.  Every place we visited in China served us tea.

During this trip, we were able to visit a vineyard-like grower of tea.  You can buy tea, taste tea, shop for anything tea related from tea pillows, to tea candy and tea marshmallows.  Anything you want in tea, they sell.

There are many aspects of the tradition of Chinese tea.  Some that I found especially interesting are:
• It takes eight hours to make two pounds of tea leaves.
• The entire procedure must be done by hand; no machines.  The Chinese believe the only way to make things well is by hand.
• If you have too much tea that is too strong, you can get "tea drunk," which is similar to alcohol drunk, where you can get a headache, a stomachache and generally don't feel very well.
• They have a tea ceremony similar to wine, where you shake it and smell it.
• There is a special way to hold your cup when you're drinking tea.  You hold the cup with your right hand and put your left hand under the bottom of the cup. 
• China does not export their highest quality tea because there's not much of it and it's incredibly expensive. 

Three common types of tea are black tea (where the tea leaves are totally fermented), green tea (where the tea leaves are not fermented at all) and oolong (which is semi-fermented).  All three have different tea plants and fermentation processes. White tea is a special variety of unfermented green tea.  Chamomile tea is considered an herb, it is not a tea.  You serve different teas at different times.  For example, black tea is in the morning and green tea is after eating.

Green tea is very low in caffeine; black tea has eight times more caffeine than green tea.  You can tell good tea by the color of the leaves and the size of the leaves.  The lighter the color and younger the leaves the better the tea.  Also, the smaller the leaves and stronger the smell the better the tea.

We were able to participate in a tasting.  They put a few tea leaves in our glasses, added a tiny bit of water, we smelled it and then swirled it around in the glass.  They then added additional water.  When they pour the water into the tea glass, the woman pouring the tea flicks her wrist three different times, very high up above the glass.  If she doesn't spill a drop of water it means you are warmly welcomed.

A very common way of saying "thank you" in Chinese tea ceremonies, business matters and in the general culture is to take your forefinger and your middle finger and hit them against the table three times. 

The Chinese don't put milk in their tea.  Milk is only for English tea, because English tea is bitter.  Green tea should be served hot or room temperature.  To slurp your tea is completely unacceptable and if you do slurp you're called a "buffalo drinker."

Chinese tea is loose.  They don't use tea bags or a strainer, so you have to manipulate drinking the tea so as not to swallow the leaves.  They always have tops to the teacups to keep it warm and it's served with washcloths in order to wash your hands.  According to the Chinese, tea bags show the worst quality of tea.  It's considered tea dust.  They compared it to drinking instant coffee.

Day 3 - September 9, 2009 – Traveling to Hangzhou

I was really looking forward to traveling by train to Hangzhou and I was not disappointed.  It was a great opportunity for me to learn more about the Chinese culture and see more of China's beautiful landscape.

Hangzhou is in the Zhejiang Province located about 112 miles southwest of Shanghai.    Hangzhou has a population of over 6 million people, which is small by Chinese standards, and has a beautiful fresh water lake called West Lake.  West Lake is surrounded by mountains on three sides and is very well known in China.

Many Chinese homes, especially in farm villages, have temples on top of them to pay homage to their ancestors.  Ancestry and history play a large part of the Chinese culture and the temples are another example of these influences.

I also thought it was interesting, that unlike the U.S., Chinese grooms and their families pay for about 80 percent of the cost of their weddings.

It is early in the day of September 9, 2009 – 9/9/09 – and 9 is a very lucky number in the Chinese culture.  If fact, the Chinese celebrate the ninth second, of the ninth minute, of the ninth hour, of the ninth day, of the ninth month of the ninth year.  The luck of nine did not rub off on the number four in this culture.  Four is considered very unlucky, similar to the U.S. perception of the number 13.

I look forward to reporting more about this day's events in tomorrow's blog.

September 8, 2009 - Day 2

We spent the first part of our day with the American Chamber of Commerce for a discussion on "green collar" jobs.  Chinese carbon emissions are escalating and China has seven of the 10 most polluted cities in the world.  As a result, environmental protection has become more important to the Chinese.

Later in the day we traveled to Eli Lilly's facility at the Pudong Science Park.  Lilly has over 2,000 employees in China, which means China has the second largest Lilly operation in the world.  Pudong is one of Shanghai's newest districts with a focus on three main industries: life sciences, software and integrated circuits.

Some of us were also able to visit ShangPharma.  ShangPharma provides research services to pharmaceutical and biotech companies.  They currently have over 1,600 scientists.  An interesting question was raised about how intellectual property is protected for the company and its clients.  The uncertainty of intellectual property protection is not isolated to just ShangPharma.  It is an issue that China is addressing as a country.

Following these visits we had a traditional Chinese lunch that was again served on a lazy Susan.  There were six different courses that included duck, shrimp, squid, scallops, fresh vegetables, jellyfish and fried rice.  Beer and wine were again offered.  Chinese meals are traditionally very  large.  I was curious how the society remains so thin.  Meal preparation seems to hold the answer.  They use vegetable oils and other "waist friendly" and heart healthy preparation methods.

The day concluded with a Friends of Indiana reception.  Guests included companies that have a business connection to Indiana or have an interest in doing business in Indiana.  Eli Lilly, Cummins and Alison Transmission all attended.

I'm really looking forward to traveling by train to Hangzhou tomorrow.  It will be a great opportunity for me to see some of the rural parts of China and its landscape.

Incentives are on the rise for businesses to provide "green" products and services.  Many consumers are willing to pay a premium for products that are environmentally friendly, and businesses have taken notice.  Buzzwords such as "organic," "recyclable" and "hybrid" are used to distinguish a product from its competitors.  Even the government has increased its focus on encouraging companies to provide environmentally friendly products and services by offering a wide array of tax incentives available to companies and consumers.  It is not surprising that many companies have responded to these incentives by embarking on green marketing campaigns.

However, companies engaged in green marketing are not only increasing their profits, but also their risk.  Lawsuits and class actions accusing companies of "greenwashing" - marketing the environmental friendliness of a company's product in a false or misleading way - have sprung up across the nation.  These lawsuits have been filed against companies in a variety of industries and trades, including construction companies, retailers, automakers, candy makers and manufacturers of cleaning supplies.

In addition to these consumer actions, the Federal Trade Commission (FTC) has also increased its scrutiny of green marketing.  In June 2009, the FTC filed suit against Kmart, Tender Corporation and Dyna-E International for making false and unsubstantiated claims that their products were biodegradable.  The FTC alleged that these claims did not conform with environmental marketing guidelines contained in the "Green Guides," a set of regulations used by the FTC to determine whether a company's environmental marketing constitutes consumer fraud.  A revised version of these guides will be released later this year and will address the changes and growth in green marketing over the past ten years.

Although green marketing is a potentially invaluable tool, companies should ensure that they understand and minimize the risks that are associated with its use.  For further information regarding green marketing and ways to manage its risk, please contact Michael McNally or Jacob Cox in Ice Miller LLP's Competitive Business Practices Litigation Practice Group and members of the Firm's Green Industries Initiative.

Blog was written by Paul Jones, partner in the Tax Practice Group and member of the Firm's Green Industries Initiative.

Nearly five months after the enactment of the American Recovery and Reinvestment Act, the U.S. Department of the Treasury and the U.S. Department of Energy (DOE) today announced a multi-billion dollar program for the development of renewable energy projects.  The Act extended and modified tax credits for renewable energy projects in a manner intended to make such projects more financially feasible during the current economic downturn.  The Act authorized the Treasury to make direct payments to companies that create and place in service renewable energy facilities beginning January 1, 2009.

Under the new program, businesses may elect to forgo renewable energy tax credits in return for an immediate reimbursement of a portion of qualified expenses.  The cash in lieu of credit program is intended to provide immediate stimulus in local economies, and guidance is now available for businesses to elect direct payments in lieu of tax credits in support of renewable energy facilities.  According to their press release, the Treasury and DOE estimate that the cash in lieu of credit program will support 5,000 bio-mass, solar, wind, and other types of renewable energy production facilities.  While applications are not yet being accepted, businesses interested in applying for the new program should start preparing now to seek the cash grants.

Businesses considering the election of cash in lieu of credits should carefully consider not only the requirements of the program, but also the tax consequences of the election as it may impact the overall economics of the project.

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.