Kristina Tridico is a partner at Ice Miller LLP.  Her primary areas of concentration are corporate transactions, environmental and sustainability law.  Kristina is chair of Ice Miller's Green Industries Initiative.

The Indiana Department of Environmental Management reminded businesses, schools and municipalities that you have until August 29th to apply for Pollution Prevention Grants. The grants are designed to help organizations implement prevention activities and processes. The "P2" grants require a 50% cash or in-kind match, but there are exceptions for MBE/WBE, small businesses and others.  Matching grant funds of up to $250,000 are available.

Recent grants have been awarded for:

• Church Brothers Collision Repair (Marion County): Awarded $63,584 to convert four of their locations to use waterborne basecoat paint. This will replace the current paint that has a higher amount of volatile organic compounds (VOC), reducing VOC emissions into the air.
• The Muncie Sanitary District (Delaware County): Awarded $45,000 to purchase reusable bags and distribute them to local grocery stores. The grant will also go toward measuring the amount of plastic and paper saved through the reusable bag program.
• Nimet Industries, Inc. (St. Joseph County): Awarded $14,933 to install an electroless nickel dialysis machine in order to reduce the amount of waste that is produced from their metal finishing process.
• Harrison Steel Castings Company (Fountain County): Awarded $100,000 to reduce the amount of resin in their chemically bonded sand molds. This will reduce the amount of volatile organic compounds released into the air.
• Hill's Pet Nutrition Indiana, Inc. (Wayne County): Awarded $71,000 to install a water conservation system and reduce the facility’s wastewater discharge by millions of gallons.
• Frito-Lay, Inc. (Clinton County): Awarded $50,000 to design and install a waste heat recovery system that will significantly reduce energy consumption.
• Saint-Gobain Containers (Jay County): Awarded $30,000 to install and test an energy efficient compressed air system, used for the first time in the United States.

Go to www.idem.in.gov/prevention/p2grants for additional information.

“Retention and reuse of older buildings is an effective tool for the responsible, sustainable stewardship of environmental resources,” stated Richard Moe, President, National Trust for Historic Preservation: at a dinner last December where Moe was honored by the National Building Museum with the Vincent Scully Prize for his work on historic preservation.  Moe went on to state that “[N]o matter how much green technology is employed in its design and construction, any new building represents a new impact on the environment.  The bottom line is that the greenest building is one that already exists.”

Moe is not alone in seeing the critical interplay between historic preservation and sustainable development.  I’m with him, which is why when I was recently asked by the Indiana Chapter of the United States Green  Building Council to speak to its members and guests about tax incentives for sustainable development I could not resist the opportunity to talk a little bit about federal historic rehabilitation tax credits.  Federal income tax law has allowed for many years two credits , a 10% credit for pre-1936, non-certified historic structures, and a 20% credit for “certified historic structures”.  The credit amount equals credit rate (10% or 20%) multiplied by amount of “qualified rehabilitation expenditures”. 

The 20% credit provides the historic developer a source of funds with which to fund gaps in financing.  The source is tax credit equity provided by an investor or investors willing to become an owner of the project for 5 years in return for tax credits generated by the project expenditures.  For example, assuming the project has $10M of qualified rehab expenditures (defined below), the project owner (a partnership for federal tax purposes) has $2M in federal tax credits to pass through to its owners.  The project owners can typically raise 85-95% of the $2M in the form of tax credit investor equity. 

There are four basic requirements to consider, though other requirements and limitations(such as those related to tax-exempt use of the property) may apply

Must involve a “certified historic structure” 

Must result in “qualified rehabilitated building” 

Must have “qualified rehabilitation expenditures” 

Must be a “certified rehabilitation” 

• Rehabilitation of a certified historic structure must be certified by the Secretary of the Dept. of Interior in order to qualify for the credit
• Three part application process involving the State Historic Preservation Officer (SHPO) and the Dept. of Interior

As mentioned above, other limitations and special rules apply, but historic rehabilitation tax credits can serve as one of the many incentives potentially available to finance sustainable development.

April 28th was proclaimed Biofuels Day in Indiana by Governor Mitch Daniels.  The announcement came that same day at the informative South Shore Clean Cities, Inc. conference, "Biofuels:  Moving Indiana Forward."

The conference featured a diverse group of speakers including Congressman Pete Viscloskey and representatives for Congressman Joe Donnelly and Senator Richard Lugar, along with representatives from state government, industry, agricultural associations and the research community.

The challenges to further development of the biofuels industry in Indiana (and elsewhere) were highlighted by nearly all the speakers.  They included:  economics costs, technical reliability of the energy products, social acceptance and appropriate government policies.

Some of the discussion highlights included: 

Collaboration was a consistent theme as well.  The Indiana energy office, as an example, is working with counterparts in three other states (KY, TN, and AL) to create an I65 corridor that spans all four states.  This would ensure that motorists are never more than 1/4 of a tank to the nearest E85 station.  Since the inception of the program in 2006, Kentucky has added four stations, Tennessee 20 and Alabama 4.  All states had no stations open prior to the start of the project.

There clearly is a growing recognition that our support for alternative energy sources must be about more than building ethanol and biodiesel plants around the state.  While there admittedly has been significant production increases in the last few years, emphasis must be placed on next generation technologies, continued distribution efforts, technical standards, adequate government policies and most importantly on key partnerships to ensure a successful transition to alternative energy.

The Green Commission reconvened on Thursday, April 24th after a hiatus during the transition of administrations in city government. The commission hosted Deputy Mayor Nick Weber who spoke on the role of green development in for the city. Deputy Mayor Weber was followed by Department of  Public Works (DPW) Director David Sherman who outlined the goals of the DPW, including water conservation, energy conservation though fleet management and a study of city groups to see how the city can be made greener.  Tim Method then outlined the primary green steps the city plans to take in 2008, including:

1. Energy efficiency and conservation and the implementation of an energy conservation policy city-wide;

2. Purchasing by the city of eco-friendly products and implementing purchasing policies;

3. Traffic light conversion to LED;

4. Green building practices;

5. Decreasing fuel consumption (fleet management practices);

6. Reviewing public transportation options and strategies;

7. Internal city-wide recycling programs; and

8. Natural resource area focus - stormwater design manual and CSO long-term control plan.

The commission also heard updates from community and green commission members including the new Indianapolis Chamber of Commerce Green Business Initiative (6 companies, including Ice Miller LLP have met the criteria as a green business), the Indiana Sustainability Alliance (look for a new event hosted by a major manufacturer on its green practices), Keep Indianapolis Beautiful (planning on moving into its new headquarters in June) and Eli Lilly (discussing the green aspects of its Day of Service).

The commission agreed that its next steps would be to have the work groups convene to determine the top 1 - 3 priorities in each area so that the commission can establish the key implementation steps and recommend those to the mayor's office for consideration. The commission plans to meet in June to discuss the priorities. Interested parties can contact Tim Method at DPW to join the list serve to receive updates on the commission.

Earth Day Greetings! What is Earth Day and why does it matter to your business? Earth Day was founded to put environmental issues on the nation's political agenda. It certainly is on the national agenda in 2008. Do you feel inundated by news stories about going green? Just today I heard on the radio how one national cafeteria vendor is incorporating the slow food movement into their cafeteria management by going on a low "carb" diet, which in this case is a low-carbon emitting plan, read about how one San Francisco Air District is weighing fees on greenhouse gas emissions and learned about the Environmental Protection Agency's new initiative to encourage the building industry to adopt green building practices and to enhance public awareness of the benefits of green buildings.

Why does this matter? Because customers and consumers are hearing the same messages. Editorials are changing from when is the United States going to address environmental impacts to how. As green takes center stage, we are facing a heightened awareness and a more educated consumer base. So, has the original Earth Day goal been met? Is the environment on the political agenda? One can argue that it is. One commentator today discussed whether the next president of the United States will be able to undertake climate change as a legislative priority and one Indiana gubernatorial candidate is running a platform of creating Green Collar jobs in Indiana.

"Five months before Earth Day, on Sunday, November 30, 1969,  The New York Times carried a lengthy article by Gladwin Hill reporting on the astonishing proliferation of environmental events: 'Rising concern about the environmental crisis is sweeping the nation's campuses with an intensity that may be on its way to eclipsing student discontent over the war in Vietnam...a national day of observance of environmental problems...is being planned for next spring...when a nationwide environmental 'teach-in'...coordinated from the office of Senator Gaylord Nelson is planned....'" With a change in terminology to green, sustainable and renewable, there is again a proliferation of reporting on environmental events and a renewed sense of enthusiasm and energy for Earth Day, 2008.

Ice Miller is celebrating Earth Day by renewing its commitment to being a green business and by joining the Greater Indianapolis Chamber of Commerce Green Business Initiative.  Ice Miller has pledged to continually strive toward green business practices, and to operate to conserve natural resources and eliminate waste. For more information on the Greater Indianapolis Chamber of Commerce's Green Business initiative, email GreenBusiness@indylink.com.

On March 19, 2008, the INdiana Sustainability Alliance (INSA) hosted its first event in downtown Indianapolis. For those that do not know, INSA’s mission is to promote the economic growth of the sustainable development, green building, renewable energy, water management, and clean technology industries in Indiana.  The event drew over 100 attendees that represented several Indiana businesses, policy makers, colleges and universities, and other environmental organizations.   

The event started off with INSA's special guest the former Mayor of Honolulu, Jeremy Harris.  Mayor Harris discussed the sustainable issues facing the business world, communities and local governments and shared several of his lessons learned from his ten years of service as the Mayor of the City and County of Honolulu, Hawaii. During his three terms as Mayor, Honolulu was recognized as one of the best managed cities in the United States and achieved worldwide recognition for its sustainable practices.  

After Mayor Harris finished, Dr. Michael Walsh, an Executive Vice President of Chicago Climate Exchange, Inc., took the stage and described the Chicago Climate Exchange (CCX), the reasons behind its success and the likelihood of a national carbon cap being adopted in the U.S.  CCX is the world’s first and North America’s only voluntary, legally binding greenhouse gas reduction and trading program for all six greenhouse gases with offset projects worldwide.  Dr. Walsh spoke at the event about the reasons U.S. companies are voluntarily becoming involved in the CCX and answered questions from the crowd about the opportunities available to Indiana companies through CCX. 

With the number of attendees and committed partners, such as the Indiana Chapter of the United States Green Building Council, the Indiana Department of Energy and Defense Development, Clean Wave Ventures, LLC, Knoefler Enterprises, the Ball State College of Architecture Planning Indianapolis Center, the Richard G. Lugar Center for Renewable Energy and Ice Miller LLP, INSA seems to be achieving its primary goal of bringing together policy makers, environmental groups, universities, and Indiana businesses to promote the growth of sustainable industries in Indiana. For more information about INSA and how to get involved, please contact Alex Forman and Paul Jones.

Indiana's General Assembly has passed House Bill 1280, Energy Efficient Buildings, which requires the environmental quality services council (EQSC) to study whether public entities should be required or encouraged to seek to achieve energy and environmental design ratings in the construction and renovation of buildings and structure and related issues. The General Assembly adjourned sine die March 14.  The Speaker of the House and the President Pro Tem of the Senate have seven days after sine die to sign all bills, after which they are sent to the Governor's office.  Once a bill reaches the Governor's office, the Governor has seven days to take action (sign, veto, or let the legislation become law without his signature). March 28 is the Governor's final deadline for signing bills. A technical corrections day, if needed, is set for April 15.  Both houses would convene at 1:30  p.m . The bill originally required a building constructed or designed under certain public works contracts entered into after December 31, 2008  to be designed with the goal of achieving the United States Building Council's Leadership in Energy and Environmental Design (LEED) rating system, the Green Globes Two Globes level or equivalent standard under an accredited program.  It contained provisions regarding state energy purchases and Energy Star rated equipment. It allowed the Indiana  Economic Development Corporation to adopt rules regarding priority for economic development projects that met or surpassed LEED criteria. The EQSC will likely consider these types of issues in determining whether public entities should be required or encouraged to seek to achieve energy and environmental design ratings.

Wyoming has established a regulatory framework for carbon capture and sequestration.  Governor Freudenthal signed two bills March 4 (H.B. 89 and H.B. 90) to establish a framework for carbon capture and sequestration.  H.B. 90 gives the Wyoming Department of Environmental Quality the authority to regulate the long-term storage of carbon dioxide.  It sets up permitting requirements. H.B. 89 addresses the control of underground pore spaces where carbon dioxide could be stored long term.  According to policy associate with the National Conference of State Legislatures in Denver (see 43 BNA ISSN 1521-9402) as of March 5, 2008, 231 bills were pending in 31 states concerning carbon capture and sequestration.

Michigan is a member of the Midwestern Regional Initiative (the Midwestern Greenhouse Gas Reduction Accord) to address climate change.  Michigan legislators are considering legislation aimed at encouraging the development of alternative energy technology, according to a spokeswoman for the Senate Republican Caucus.  The spokesperson told BNA, Inc. the bills introduced March 4th establish tax incentives to encourage development and the purchase of clean energy and was an authority on clean energy for the permitting and oversight of carbon sequestration and other clean energy processes.

Companies are marking their calendars for September 10, 2008,  when the Regional Greenhouse Gas Initiative (RGGI) will hold its first regional auction of carbon dioxide emissions allowances.  The RGGI announced that pending final negotiations, four companies, World Energy Solutions, Inc., Perrin Quarles Associates, Inc., ICF International and Greenhouse Gas Management Institute will assist with the administration of the cap-and-trade program.  According to RGGI, an initial reserve price for one allowance (one ton of carbon dioxide emissions) will be set at $1.86.  The Regional Greenhouse Gas Initiative, or RGGI, is an agreement among the Governors of ten Northeastern and Mid-Atlantic states (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Hampshire, New York, Rhode Island and Vermont) to reduce greenhouse gas emissions from power plants. The RGGI participating states have committed to cap and then reduce the amount of carbon dioxide (CO2) that certain power plants are allowed to emit, limiting the region’s total contribution to atmospheric greenhouse gas levels. The participating states have agreed to implement RGGI through a regional cap-and-trade program whereby the participating states anticipate auctioning nearly the entire annual regional emissions budget, which initially is approximately 188 million short tons of CO2. Each ton of CO2  will constitute an “allowance.”   RGGI's second quarterly auction will be held December 17, 2008. For additional information on the auction go to www.rggi.org/press.htm.