A GRAND CHALLENGE FOR CURRENT AND FUTURE GENERATIONS IS TO ACHIEVE SUSTAINABLE USE OF WATER SYSTEMS, INCLUDING GROUNDWATER SYSTEMS WHICH ARE PARTICULARLY VULNERABLE TO DEPLETION. MANY REGIONS OF THE COUNTRY HAVE A HIGH DEPENDENCE ON GROUNDWATER FOR AGRICULTURAL, MUNICIPAL, AND DOMESTIC USES, AS WELL AS FOR SUPPORT OF AQUATIC HABITATS AND RELATED ECOSYSTEM SERVICES. YET AQUIFER DEPLETION CONTINUES TO TAKE PLACE, IMPOSING RISING COSTS ON FARMERS, RURAL COMMUNITIES, THE ENVIRONMENT, AND SOCIETY GENERALLY. BY 2030 OVERALL CONSUMPTIVE USE OF WATER IS EXPECTED TO EXCEED LEGALLY AVAILABLE SURFACE AND GROUNDWATER IN THE WESTERN U.S. AS SURFACE WATER BECOMES FULLY ALLOCATED, GROUNDWATER WITHDRAWALS CAN BE EXPECTED TO INCREASE TO MEET RISING DEMAND, IN PART BECAUSE WESTERN U.S. STATES HAVE DONE LITTLE TO REGULATE GROUNDWATER PUMPING. THE RESULT OF INCREASED GROUNDWATER WITHDRAWALS CAN INCLUDE LAND SUBSIDENCE, DEWATERING OF SPRINGS AND WELLS, STREAMFLOW DEPLETION, ECOSYSTEM IMPACTS, SEAWATER INTRUSION, AND REDUCED GROUNDWATER STORAGE.IT IS CRITICAL THEREFORE TO IDENTIFY POTENTIAL PATHWAYS TOWARD SUSTAINABLE MANAGEMENT OF GROUNDWATER RESOURCES. BECAUSE GROUNDWATER AQUIFERS VARY AND ARE REGION-SPECIFIC, SOLUTIONS TO GROUNDWATER DEPLETION NEED TO BE DEVELOPED IN WAYS THAT ARE GENERALIZABLE AND TRANSFERABLE, AND THIS IMPLIES FINDING SOLUTIONS THAT HAVE OR CAN GAIN THE SUPPORT OF STAKEHOLDERS. THIS PROJECT WILL UNDERTAKE ACTIVITIES TO ACHIEVE THESE GOALS IN A PARTICULAR BASIN, AND TO USE THE EXPERIENCE TO DEMONSTRATE THE GENERALIZABILITY AND TRANSFERABILITY OF THE LESSONS LEARNED TO OTHER BASINS.THE MOST CHALLENGING OBSTACLE TO SUSTAINABLE GROUNDWATER USE IS THE ENORMOUS UNCERTAINTY ABOUT THE GROUNDWATER SYSTEM. GIVEN ITS COMPLEX, THE BELOW-GROUND THREE-DIMENSIONAL DYNAMICS OF SPATIAL FLOWS, CONNECTIVITY, AND RECHARGE, UNDERSTANDING THE MAGNITUDE AND TIMING OF IMPACTS FROM ACTIONS BY ONE INDIVIDUAL WATER USER ON OTHER USERS, ON SURFACE FLOWS, AND ON HABITATS AND ECOSYSTEMS IS EXTREMELY UNCERTAIN. MOREOVER, THESE UNCERTAINTIES ABOUT THE NATURAL SYSTEM PART OF A "COUPLED HUMAN-NATURAL SYSTEM" EXACERBATE THE UNCERTAINTIES IN THE HUMAN SYSTEM: HOW WILL A GIVEN MANAGEMENT INTERVENTIONS OR POLICY AFFECT THE COSTS, BENEFITS, AND OPPORTUNITIES ACROSS HETEROGENEOUS FARMS AND RURAL COMMUNITIES THAT DEPEND ON THESE RESOURCES? THIS PROPOSAL CONTRIBUTES TO SUSTAINABLE GROUNDWATER MANAGEMENT BOTH IN OREGON AND ACROSS THE U.S. BY SHOWING HOW RESEARCH THAT REDUCES UNCERTAINTY ABOUT THESE SYSTEMS, WHEN DEVELOPED IN A WAY THAT INVOLVES AND ENGAGES WITH STAKEHOLDERS, CAN BE A CATALYST TO IMPLEMENTING CHANGES THAT ACHIEVE SUSTAINABLE GROUNDWATER MANAGEMENT. OUR FINDINGS FOR ONE REGION IN OREGON WILL HAVE GENERALIZABLE AND TRANSFERABLE IMPLICATIONS FOR MANY OTHER REGIONS WHERE GROUNDWATER DEPLETION IS OCCURRING AND WHERE FINDING AND IMPLEMENTING MANAGEMENT SOLUTIONS HAVE BEEN UNSUCCESSFUL. THE VALUE OF THIS WORK IS UNDERSCORED BY RECOGNIZING THAT THERE ARE 37 MILLION ACRES OF GROUNDWATER IRRIGATED FARMLAND IN THE U.S.THE PROJECT SETTING IS THE HARNEY BASIN, OREGON WHICH EPITOMIZES ALL OF THESE GROUNDWATER CHALLENGES. THE FIRST MAIN COMPONENT IS THE DEVELOPMENT OF A HYDRO-ECONOMIC MODEL THAT COUPLES A THREE-DIMENSIONAL GROUNDWATER HYDROLOGY MODEL WITH AN AGRICULTURAL ECONOMIC MODEL OF LAND AND WATER USE. THE SECOND COMPONENT OF THE PROJECT IS TO DEVELOP AN AGRO-ECONOMIC MODEL OF THE REGION'S AGRICULTURAL SYSTEM, AND THEN TO LINK THAT MODEL TO THE HYDROLOGY MODEL.THE THIRD COMPONENT OF THE STUDY WILL INVOLVE STAKEHOLDERS IN SEVERAL WAYS: I) TO LEARN FROM STAKEHOLDERS ABOUT THE REGIONAL SYSTEM AND SIMULTANEOUSLY TO EDUCATE STAKEHOLDERS ABOUT THE ECONOMIC MODELING, II) TO ELICIT INFORMATION AND PERSPECTIVES RELATED TO PATHWAYS, SCENARIOS, AND PARAMETER VALUES FOR THE MODELING, AND III) AS AN AUDIENCE FOR THE PRESENTATION AND DISCUSSION OF THE MODELING RESULTS. OUR GOAL IS TO TEST IF THE PARTICIPATORY MODELING PROCESS CHANGES THE KNOWLEDGE AND ATTITUDES RELATED TO THE HYDROLOGIC SYSTEM IN THE HARNEY BASIN AND ITS MANAGEMENT, AND IF THIS EFFECT IS DIFFERENT AMONG THE GENERAL PUBLIC, THE STAKEHOLDERS ENGAGED IN THE PROJECT, AND FARMERS.THE OVERARCHING HYPOTHESIS HERE IS THAT A WELL-DESIGNED HYDRO-ECONOMIC SYSTEM MODEL CAN REDUCE UNCERTAINTY ABOUT THE SYSTEM, AND THUS CAN CONTRIBUTE IN IDENTIFIABLE WAYS TOWARD INCREASED SUPPORT FOR REALISTIC SOLUTIONS TO GROUNDWATER MANAGEMENT PROBLEMS. THE SUCCESSFUL DEMONSTRATION OF THE WAYS THAT A HYDRO-ECONOMIC SYSTEM MODEL OF THIS KIND CONTRIBUTED TO REDUCING UNCERTAINTY ABOUT THE SYSTEM, AND FACILITATED A FOCUS ON PATHWAYS FORWARD THAT WERE REALISTIC, COST-EFFECTIVE, FAIR, ETC., WOULD PROVE THE VALUE OF THIS KIND OF RESEARCH AND ENGAGEMENT IF APPLIED IN OTHER REGIONS.WE ALSO EXPECT THIS PROJECT TO PRODUCE INSIGHTS ON POTENTIAL ADVANTAGES AND LIMITATIONS FOR A RANGE OF ALTERNATIVE POLICY INSTRUMENTS AIMED AT ADDRESSING GROUNDWATER DEPLETION IN RURAL, AGRICULTURAL SETTINGS. IN PARTICULAR, THE RELATIVE COST-EFFECTIVENESS OF DIFFERENT REGULATORY VERSUS MARKET-BASED POLICIES IS EXPECTED TO DEPEND SIGNIFICANTLY ON THE SOURCES OF HETEROGENEITY IN REGIONS LIKE THE ONE UNDER STUDY, WHERE AGRICULTURAL PRODUCTIVITY VARIES GREATLY AT THE PARCEL LEVEL. THIS DIMENSION, COMBINED WITH THE THREE-DIMENSIONAL VARIABILITY AND DYNAMICS IN THE GROUNDWATER SYSTEM, CREATE A CHALLENGING SET OF SPATIAL AND TEMPORAL FACTORS FOR THE DESIGN OF COST-EFFECTIVE POLICY MECHANISMS RESPONSIVE TO STAKEHOLDERS' PRIORITIES. THE INSIGHTS FROM THE EXPLORATION OF THESE COMPLEX QUESTIONS WILL REPRESENT A NOVEL CONTRIBUTION TO THE GROUNDWATER ECONOMICS LITERATURE.STAKEHOLDERS PLAY A CRITICAL ROLE IN THE PROJECT FROM START TO FINISH. AS IN OTHER RESEARCH INVOLVING STAKEHOLDERS, THEY WILL INFORMALLY PROVIDE LOCAL INFORMATION AND CONTEXT ABOUT THE STUDY REGION, INCLUDING DETAILS ABOUT ITS INSTITUTIONS, HISTORY, AND CULTURAL DIMENSIONS. HOWEVER, IN CONTRAST TO THE TYPICAL INFORMAL AND UNSTRUCTURED ENGAGEMENT WITH STAKEHOLDERS, STAKEHOLDERS WILL PARTICIPATE IN A STRUCTURED PROCESS TO DEVELOP BOTH QUALITATIVE NARRATIVES FOR POLICY SCENARIOS AND PARAMETER VALUES AS WELL AS QUANTITATIVE VALUES FOR SYSTEM MODELING. IT WILL BE IMPORTANT TO GAIN AN APPRECIATION FOR STAKEHOLDERS' PERSPECTIVES, HOW THEY VIEW THE NATURE OF THE PROBLEM, THE ROLE OF RESEARCH INCLUDING ECONOMICS AND MODELS. STAKEHOLDERS ARE LIKELY TO HAVE STRONG VIEWS ABOUT PREFERRED POLICY PATHWAYS. THESE PATHWAYS WILL HAVE BIOPHYSICAL AS WELL AS SOCIO-ECONOMIC ELEMENTS; PROCEDURES FOR DEVELOPING THESE PATHWAYS ARE DISCUSSED BELOW.THERE ARE THREE NOTEWORTHY ELEMENTS OF THE PROPOSED PROJECT THAT ARE NOVEL OR UNIQUE. THE FIRST IS THE MODELING OF PARCEL-LEVEL HIGHLY VARIED AGRICULTURAL REGION, USING "HEDONIC" STATISTICAL METHODS FOR ESTIMATING LAND PRODUCTIVITY AS A FUNCTION OF LAND QUALITY AND OTHER AGROCLIMATIC CHARACTERISTICS. SECOND, THE SIMULTANEOUS DEVELOPMENT OF THE GROUNDWATER HYDROLOGY MODEL AND THE SOCIO-ECONOMIC MODEL, CARRIED OUT WITH THE CONSULTATION AND PARTICIPATION OF A LARGE NUMBER OF STAKEHOLDER REPRESENTATIVES OVER A PERIOD OF SEVERAL YEARS, REPRESENTS A UNIQUE OPPORTUNITY FOR COMMUNICATION AND LEARNING THAT WILL IMPROVE THE QUALITY OF, AND FOSTER CONFIDENCE IN, THE MODELING BY BOTH THE RESEARCHERS AND THE STAKEHOLDERS. THIRD, THE PROJECT INCLUDES A COMPONENT TO EVALUATE THE EFFECTIVENESS OF QUANTITATIVE POLICY MODELING THROUGH A BEFORE-AFTER COMPARISON OF STAKEHOLDERS' KNOWLEDGE AND ATTITUDES RELATED TO GROUNDWATER RESOURCES AND POLICIES IN THE BASIN. THIS STUDY WILL BE THE FIRST TO PROVIDE EVIDENCE OF THE EFFECTIVENESS OF A PARTICIPATORY RESEARCH PROCESS TO INCREASE THE IMPACT OF QUANTITATIVE POLICY RESEARCH.