Water is scarce in southern Alberta, and climate change predictions suggest that water might be even scarcer. There is increasing pressure to leave more water in rivers for environmental purposes, which will further increase water scarcity for extractive users. There is also an urgent need to find mechanisms to allocate and reallocate water among competing uses, such as water for the environment and for extractive uses. Achieving these objectives within current water dependent communities will involve different socioeconmic impacts. The level of impact will depend on the policy choices made, the acceptability of such policies among stakeholders, water users reactions to such policies, and the ability of current water users to cope with less water. These issues are examined in this project.