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PRODUCTS BY DESIGN, STRESSED LOOKING AT THE

WHOLE LIFE CYCLE OF A PRODUCT AND MAKING

CHANGES IN A PRODUCT'S DESIGN TO REDUCE THE

OVERALL ENVIRONMENTAL IMPACT. VOLKSWAGEN,

EUROPE'S LARGEST CAR MANUFACTURER, HAS MADE

CHANGES IN ITS CAR DESIGN SO THAT IT IS EASIER TO

RECYCLE ALL CAR PARTS. THESE CHANGES WILL BE

GOOD FOR THE ENVIRONMENT AND, EVENTUALLY, FOR VOLKSWAGEN'S BOTTOM LINE.

MR. CHAIRMAN, I AM INTERESTED IN HEARING THE

WITNESSES' COMMENTS ON WAYS THE FEDERAL

GOVERNMENT CAN FOSTER GREEN TECHNOLOGIES.

HUGH FAULKNER, EXECUTIVE DIRECTOR OF THE

BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT,

A GROUP SET UP TO ADVISE THE EARTH SUMMIT

ABOUT INDUSTRY'S VIEWS ON ENVIRONMENTAL ISSUES,

STATED: "THERE CAN CLEARLY BE NO PROSPECT FOR

SUSTAINABLE DEVELOPMENT...WITHOUT GOVERNMENT Mr. VALENTINE. Thank you.

All right. Well, we are ready to begin.
STATEMENTS OF NICK BAVARO, FOUNDER AND CEO, GLOBAL

GREEN, INC., NORCROSS, GA; HOWARD KLEE, JR., DIRECTOR,
REGULATORY AFFAIRS, AMOCO, YORKTOWN, VA; WILLIAM H.
McMULLEN III, MANAGER OF REGULATORY AFFAIRS, NOVO
NORDISK BIOCHEM INCORPORATED, FRANKLINTON, NC;
JOE CASCIO, CHAIRMAN, U.S. TECHNICAL ADVISORY BOARD,
INTERNATIONAL STANDARD ORGANIZATION, ENVIRON-
MENTAL MANAGEMENT TECHNICAL COMMITTEE, SOMERS,
NY; GRACE WEVER, PH.D., VICE PRESIDENT, COUNCIL OF
GREAT LAKES INDUSTRIES, ROCHESTER, NY; AND W.C.
(PETE) HOWARD, VICE PRESIDENT, ENVIRONMENTAL AF-
FAIRS, GEORGIA PACIFIC CORPORATION, ATLANTA, GA
Mr. BAVARO. Thank you very much.

I'll be sitting in for Linda this afternoon. She just recently came down with an illness. I believe that illness is the willys. She got a little nervous, so I'll beif, indeed, you thought it was difficult going with your introductions referring to Linda, think about how difficult it might be for me with her speech as I'll be using her words. Nonetheless, I feel strongly about her words as well.

Gentlemen and ladies, I sincerely applaud you for your intentions of moving toward a more environmentally sustainable future through the use of green organizations and their associated technologies. I'd also like to thank you for the opportunity to address your committee on this most important subject matter, the issue of cleaning up the environment for our future generations.

Our company, Global Green Incorporated, was created with this thought in mind. Prior to any proposed legislation, we have been actively producing a product line of soft and hard apparel goods: Tshirts, fleece wear, tote bags, that are made from recycled plastic, post-consumer waste 2-liter soda bottles. We have trademarked our fabric as RETRIEVA, for it retrieves previously used resources.

The environmental damage that we have created today is everyone's responsibility. Every day we use products that have a minute impact on the environment, but when we multiply the effect by billions, by billions of people over several generations, the damage becomes substantial. This in part is what moved us to form our company.

My personal feelings and concerns toward the environmental cleanup came from my convictions of helping to bring a better tomorrow for our children. I decided that if I can make a difference, then it was time to stop standing by and get involved.

Never stopping, we researched what products—which products after recycling could offer more reusable by-products, and although paper takes up the majority of landfill space, its reusability is very limited. Plastic had the best overall potential to be reused into real products.

That's when we started to research, research the industry. We spent countless hours at the local library looking into plastics and their potential for reuse. Through research and contacts we eventually came across a major petrochemical company in Charlotte, North Carolina, no less, that was heavily involved in plastics recy

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cling. I learned that they had a research product that created fiber from recycled 2-liter soda bottles. I contacted them and entered into a marketing relationship, for they could engineer the technology but they couldn't successfully market it.

I looked at where and how they tried to enter this technology into the marketplace and realized that in order to succeed we needed to go to an organization that was forward-thinking enough to have their own environmental recycling program already in place. That organization was the Walt Disney company at their Orlando, Florida, Reedy Creek recycling facility.

If you'll look over to the left of the chairman-excuse me—the right of the chairman and to my left, you can see the T-shirt does indeed have Jiminy Cricket, and it encourages people to recycle.

What Disney had done is that they have an annual program that they call their environmentality program for employees. What we did this year was, our concept was to have employees actually bring in recycled plastic soda containers and upon receipt they would pick up their T-shirt. This T-shirt is made of 50 percent recycled plastic content. The other 50 percent is virgin plastic. So, in essence, it is 100 percent recyclable at the end of the usage.

And by all means, you can certainly feel free to pass it around, but don't let that T-shirt leave the room as it does indeed belong to the chairman when we're done today.

This program—this program was a smashing success. Over 37,000 shirts were made and distributed. This sale actually commercially productized this technology and it gave birth to our company as it is known today.

Because we are a small start-up with limited funds, we had to borrow heavily, invest our personal savings, and get subsidized from the research company to complete this project. Without government assistance, however, I am afraid that other companies with similar opportunities will not be able to responsibly get involved and to move forward.

Gentlemen and ladies, I believe the overall concept of this proposed legislation is proactive and headed in the right direction. In order to truly succeed, however, there must be real and tangible incentives offered during the economic development phase of new products or we will once again be forced into that reactionary mode by addressing the end-of-the-pipe problem which has historically proven to be much more costly in terms of both dollars and damage done to the environment. I feel in order to stimulate the industry movement and growth, incentives for companies like ours that offer green products should be offered in the following ways.

We believe that low-cost government-assisted loans for start-up green companies should be put into place. There should be tax relief as a company qualifies under the program, possibly for the first 24 months there might be additional tax relief in the form of upwards of 25 percent reduction in the taxes owed. In subsequent years there could be lesser amounts.

There should be additional tax incentives that could be offered in the form of investment tax credits and accelerated equipment depreciation for goods used in the manufacture and marketing of I firmly believe that the government should be the first market. The Federal Government absolutely should be the first market for consumption of these products. We should have guaranteed longterm minimum order contracts that should be put into place for these goods when they are applicable. For example, our RETRIEVA goods can be made into mailbags for U.S. mail carriers. This is an example of one of our bags (indicating).

I believe that they could be made into duffle bags for all of the military. T-shirts, uniforms, et cetera. We should have immediate approval for low-cost loans also as a provision of the contract.

But most importantly, I firmly believe that government has the added economic responsibility of sustaining these green companies after initial funding. There should be government subsidies that should be offered for the purchase of these green products, for almost without exception they are initially more costly than their counterparts.

Although we can't speak for the entire industry, we can, however, convey what our costs are and what steps are added in creating our recycled garments. They include curbside pickup, reclaiming all goods, sorting, scrubbing the bottles, removing all labels, flaking, pelletizing, melting, cooling, and ultimately spinning a fiber from this cooled liquid. It does indeed add to the cost of these goods.

Additionally, I believe that steps should be taken by the government to reward those companies that have created or marketed green products prior to this proposed legislation, not after the bandwagon has been formed. This, additionally, should be offered in the form of government grants over and above the amounts granted after the legislation had been proposed, not prior to becom

We should offer low-cost, long-term loans. Additional tax incentives of an even lower amount.

I also believe that an accelerated incentive program, should be put into place, possibly over the next 18 to 24 months. This will quickly motivate movement towards this long-term solution. This will create a sense of urgency and stress the overall importance of this program.

This next point I feel very, very strongly about. It is quite possibly the most important aspect of the entire environmental movement, at least it is to us and to our company, and that point is education. Education of the masses. Does the general public really understand the importance of creating environmentally sustainable products? Do we know why we recycle? What long-term damage are we doing to the environment by not taking a proactive stance today? I think we all know the answers to these questions and they are not positive.

So whose responsibility is it to inform and educate? It's all of ours.

I propose that in order to qualify for any and all incentives available under this proposed legislation you must first submit a comprehensive educational programs proposal, one that informs and explains the technology used in manufacture of the products and why it's important to do so. There should also be periodic updates

ing law.

as part of this program so as to ensure continued focus in the right area. Funding should be withheld without these updates.

Global Green, as it turns out, we've turned away, or at a minimum we have delayed retail business because certain companies just wanted to hang our garments on racks without delivering an environmental message. In fact, Disney Retail is currently working on their message because we refused to sell them garments without the program in place.

We personally use a hang-tag on our garments to deliver our environmental message. Because we are cash limited, we cannot deliver the full educational message that we would like to do.

And sadly, I must report that as we attempt to attract additional funding investors are more interested in turning a profit than doing the environmentally correct thing. They have suggested that we compromise our beliefs for the sake of additional profit. By seeking new venture funding, we are forced into a position of giving up a large portion of our company and decision authority in order to acquire funds to sustain our growth.

And, in conclusion, the most important thing that the Federal Government can do today for start-up green companies would be to fund and to offer our aforementioned incentives, for without these incentives, I am afraid that the majority of industry already continues to proceed down the wrong path, one that is dictated by the cheapest means of producing a product without regard for the cost of the downstream problems that it will create.

At that time, you, I, and our children will be consumed with trying to right this wrong, an actual travesty when you consider that today we have the ability to significantly lessen this amount by enacting the proper legislation.

And I wonder out loud just how many more young entrepreneurial green companies will die and fall by the wayside because we couldn't compromise our beliefs but we didn't have the funds to sustain our future.

The choice is yours. Let's do the right thing.
Thank you.
[The prepared statement of Linda M. Bavaro follows:]

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