Farmer participation in a proposed 5, 600 cow central digester facility is a function of herd size, present manure handling system, income tax effects and expectations about future changes in contract terms. The ·present value of net benefits from participation ranges from $6,000 to $6,400 for large herds and $3,200 for medium herds with manure storage. No net benefits accrue to medium sized herds not currently storing manure. Environmental impacts of the proposal will likely be positive for air and water quality but could reduce soil quality unless organic matter is returned to cropland.