8-K

                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549

                                   FORM 8-K

                                CURRENT REPORT

                      Pursuant to Section 13 of 15(d) of the
                         Securities Exchange Act of 1934


                               January 28, 2009
               ------------------------------------------------
               Date of Report (date of earliest event reported)


                    BION ENVIRONMENTAL TECHNOLOGIES, INC.
             ----------------------------------------------------
             Exact name of Registrant as Specified in its Charter

         Colorado                 000-19333                84-1176672
- ---------------------------    ---------------   ---------------------------
State or Other Jurisdiction    Commission File   IRS Employer Identification
     of Incorporation              Number                  Number

             Box 566/1774 Summitview Way, Crestone, Colorado 81131
         ----------------------------------------------------------
         Address of Principal Executive Offices, Including Zip Code

                                (212) 758-6622
             --------------------------------------------------
             Registrant's Telephone Number, Including Area Code

                                 Not applicable
          -----------------------------------------------------------
          Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act
    (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
    (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
    Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
    Exchange Act (17 CFR 240.13e-4(c))



ITEM 7.01  REGULATION FD DISCLOSURE.

     The Company has issued a press release regarding the approval by the
Board of the Pennsylvania Infrastructure Investment Authority of a
$7.8 million loan for the initial stage of Bion's Kreider Farms project. See
Exhibit 99.1.

ITEM 9.01  FINANCIAL STATEMENTS AND EXHIBITS.

     (a)  Financial Statements of Businesses Acquired.

          Not Applicable.

     (b)  Pro Forma Financial Information

          Not Applicable.

     (c)  Shell Company Transactions

          Not Applicable.

     (d)  Exhibits

          Exhibit 99.1   PENNVEST/KREIDER Press Release dated January 28,
                         2009


                                  SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                  Bion Environmental Technologies, Inc.


Date:  January 28, 2009           By: /s/ Mark A. Smith
                                      Mark A. Smith, President

EX-99.1 CHARTER

EXHIBIT 99.1

                    Bion Announces PENNVEST Board Approves
               $7.8 Million Financing for Kreider Farms Dairy Project

January 28, 2009. New York, New York.  Bion Environmental Technologies, Inc.
(OTCBB: BNET) announced today that on Monday, January 26, 2009, the
Pennsylvania Infrastructure Investment Authority (PENNVEST) approved a $7.8
million loan to Bion PA 1, LLC. (a wholly-owned subsidiary of Bion
Environmental Technologies, Inc.).  Proceeds from the loan will be used to
construct Bion's previously announced Kreider Farms dairy project in
Lancaster County, Pennsylvania (Bion release: http://www.biontech.com/news/
pressreleases/release20080929.php).

Pennsylvania Governor Edward G. Rendell announced on Monday a $94 million
investment in water infrastructure that included the loan to Bion for "the
construction of a livestock waste treatment facility at Kreider Farms that
will reduce both nitrogen and phosphorous emissions to the Chesapeake Bay
watershed. The project is expected to generate a significant number of
tradable nutrient credits that could be sold to other entities within the
Chesapeake Bay watershed to help them comply with their own discharge limits
for nitrogen and phosphorous." The complete press release issued by Governor
Rendell's office can be viewed on the web at http://www.ctbpls.com/www/PA/
library/2009/2009012682.HTM.

This is the first project approved by the PENNVEST Board that supports waste
treatment infrastructure at a CAFO (confined animal feeding operation) for
the purpose of generating nutrient credits.  Based on this approval, Bion
will move forward with engineering and permitting for the Kreider project
while finalizing definitive agreements with PENNVEST.

Over the past two years, Bion has worked with the Pennsylvania Department of
Environmental Protection (PA DEP) and representatives from Pennsylvania State
University to establish an acceptable nutrient credit calculation and
verification methodology for the Kreider Farm project, which was approved by
the DEP in mid-2008.  The DEP approval projects a credit total in the range
of 140 nutrient credits per milk cow's waste treated; and perhaps most
significantly, a majority of these credits will be generated from airborne
ammonia reductions.  Ammonia air emissions from CAFOs are for the most part
quickly re-deposited onto neighboring lands, which simply advances the
nitrogen molecule's travels towards the Chesapeake Bay.   A listing of Bion's
credits is posted on the PA DEPs trading website at http://www.dep.state.
pa.us/river/Nutrient%20Trading_files/ProposalRegistryandTradableLoadTracking.
xls.  Bion's treatment system will not only reduce nutrient impacts on the
Chesapeake Bay, it will also significantly reduce local environmental impacts
such as odor, phosphorus releases to the local creeks, a host of air
emissions such as hydrogen sulfide and methane (greenhouse gas emissions), as
well as pathogens.

More than 40 states have announced plans to develop nutrient trading
programs, with Pennsylvania's program being the most advanced. Nutrient
trading programs encourage nitrogen and phosphorous reductions from non-point
source facilities (such as agriculture and livestock facilities) by providing
a program to sell credits for those reductions.  These certified nutrient
credits can be used by point source facilities such as municipal wastewater
treatment plants, with much higher remediation costs, to offset their own
nutrient discharges. The premise is that the same nutrient reduction to the
environment can be achieved at a significantly reduced cost to the community.

Bion has worked closely with both the federal and state regulatory agencies,
as well as all other stakeholders, to develop policies that will support long
term capital investment in livestock waste treatment facilities. The results
of a recent study commissioned by the Pennsylvania state legislature projects
an average nutrient removal cost of $28 per pound of nutrient per year to
upgrade existing wastewater plants.  Bion anticipates that it will be able to
reduce that projected cost by as much as 75%, based upon its models and
anticipated policy modifications.

Bion's project at Kreider Farms will be the first comprehensive on-farm waste
treatment plant installation in the state, generating a steady stream of more
than 100,000 credits per year.  In addition to this initial dairy
installation, Bion is working on a second phase of the project that it
believes will generate in excess of 1 million additional credits.  Phase 2 is
anticipated to include a renewable energy production facility that will
convert cellulose in the waste stream into usable thermal energy.  According
to the Chesapeake Bay Tributary Strategy, Pennsylvania's municipal wastewater
treatment plants that ultimately discharge into the Susquehanna River
watershed are required to reduce or offset their nutrient discharges by 7.5
million pounds per year.

Mark A. Smith, Bion's President, stated, "We are extremely pleased with the
PENNVEST Board's loan approval.  This is a great example of what
Pennsylvania's nutrient credit trading program was designed to do:  achieve
nutrient reductions required under the Chesapeake Bay Strategy at a fraction
of the cost to upgrade municipal waste treatment plants.  This value
proposition is the essence of what new technologies and solutions need to
accomplish - doing more with less - one of Bion's core principles.  We look
forward to working with PENNVEST, the PA DEP, US EPA and other stakeholders
to achieve permanent, effective, and affordable solutions for the Chesapeake
Bay."
______________________________________________________________

About Bion: Bion has provided solutions to the agriculture and livestock
industry since 1990, with 30 first-generation systems installed through 2003.
Bion's next-generation technology results from 18 years of research &
development, testing, commercial deployment, and further adaptation to
evolving standards and opportunities.  In addition to providing proven
comprehensive environmental treatment, the system recovers cellulosic biomass
from the waste stream to produce renewable energy in a process different and
much more efficient than others that seek to exploit this energy source.  The
technology is scalable, proven and quickly gaining acceptance by regulatory
agencies and other stakeholders as an effective solution to the environmental
issues associated with concentrated livestock waste.  For more information,
see Bion's website: www.biontech.com.

This material includes forward-looking statements based on management's
current reasonable business expectations. In this document, the word
'potential', 'will', 'proposed' and similar expressions identify certain
forward-looking statements. These statements are made in reliance on the
Private Securities Litigation Reform Act, Section 27A of the Securities act
of 1933, as amended. There are numerous risks and uncertainties that could
result in actual results differing materially from expected outcomes.
Contact information:
Mark A. Smith
President
303-517-5302
mas@biontech.com
Craig Scott
Vice President-Capital Markets/IR
303-843-6191 direct
cscott@biontech.com