The City of Billings and Montana Dakota Utilities (MDU) agreed in August, 2008, that MDU may extract methane gas from the Billings landfill.  The agreement states that MDU agrees to pay the City fifteen percent (15%) of the net proceeds received from selling carbon credits within sixty (60) days of receipt of payment.    MDU is entitled to deduct the costs incurred to obtain and sell the credits, including but not limited to registry fees and consultant fees, in determining the net proceeds from the sale of the credits.  In order to receive payment for the 15% of net proceeds, the City of Billings must execute the Assignment of Rights document for the sale of the credits.

In the 2008 agreement, the City Council agreed to approve carbon credity assignment agreements.  Disapproving this assignment would breach the agreement.   

There is no cost to the City of Billings since the registry and consultant fees will be deducted from the gross proceeds. The City of Billings will receive 15% of the net proceeds after all fees are deducted.

Staff recommends that the City Council approve the Assignment of Rights with MDU.