BISMARCK - A North Dakota wind project that raised concerns with wildlife officials about impacts to habitat is moving forward this summer after the developer made a $557,000 payment to Ducks Unlimited.

The North Dakota Game and Fish Department wrote in comments to state utility regulators that a considerable portion of the Foxtail Wind Project in Dickey County would affect native, unbroken prairie that is vital to declining wildlife populations.

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The agency recommended project developer NextEra Energy Resources develop a mitigation plan to make up for the impacts of the 150-megawatt wind development.

But because the agency is still developing how energy offset packages would work, Game and Fish negotiated an agreement with NextEra to offset the impacts through a one-time payment to Ducks Unlimited for native prairie conservation.

A bulk of the funding, $500,000, will go to North Dakota landowners for grassland and wetland easements for about 1,000 acres, said Johann Walker, director of conservation programs for the Ducks Unlimited Great Plains Regional Office. The rest, $57,000, will pay for Ducks Unlimited staff to work on the agreements.

Game and Fish officials recommended to the Public Service Commission that the wind project move forward after reaching the offset agreement. The commission approved the project and construction was expected to begin May 29.

During a meeting of the Legislature's Interim Natural Resources Committee last week, some characterized the payment as "extortion money." Others questioned what accountability a private party would have to ensure the mitigation projects were successful.

Game and Fish Department officials said the agreement was reached because the company wanted to quickly move forward with its project. NextEra sold the project to Xcel Energy, which will construct and operate it.

"I would not view this as the model going forward," said Steve Dyke, conservation section supervisor for Game and Fish.

Carmen Miller, director of public policy for Ducks Unlimited Great Plains Region, said the organization agreed to facilitate the easements as a private service provider and was not part of the negotiations.

Miller said Ducks Unlimited was not the first organization Game and Fish approached but was likely the quickest, most efficient and cheapest option. The Game and Fish Department does not have staff to handle mitigation projects.

Public Service Commission Chairman Randy Christmann told legislators last week the commission was not involved with the agreement and he believes future offset packages should be handled differently.

Christmann said he recommends the money be used to find willing landowners with tilled land they would like to have reverted to grasslands.

The commission does not currently have any wind energy applications pending, but projects such as the Emmons-Logan wind project are in development.

"It would be best to have this all settled before the next one is sited," said Commissioner Julie Fedorchak. "So there's an understanding from both the companies and the environmental groups and the agency of what's the best way to manage this."