: This paper brings together spatially and temporally explicit mechanistic models of hydrodynamic, water quality, and ecological processes with an economic model to examine water management alternatives for California's Sacramento River and Delta ecosystem, a large-scale watershed. Overallocated water supplies in most years, combined with increasing demand for water for environmental purposes, have created a politically charged atmosphere and a need for quantitative assessment of the implications of policy alternatives. By developing and analyzing a common set of policy scenarios, this integrated framework allows us to consider tradeoffs between agricultural economic factors, water quality, and population dynamics for two at-risk fish species. We analyze two rather extreme types of policy options; one involves structural modifications to change the flow of water within the watershed but no change in water diversions, while the other reallocates water from agricultural users to fish and wildlife. Results suggest that substantial environmental improvements could be made at a relatively modest cost to farmers (1 to 4 percent reductions in revenues) but that those costs could be significant locally. In addition to tradeoffs between farmers and environmental interests, results suggest that policy makers may need to balance competing environmental objectives.
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