In the first part, GIS multi-criteria decision-making analysis is used to identify supply and demand areas.  Having identified the potential demand and supply areas, a simulation-optimization technique is applied to estimate the amount of groundwater available at each supply center.  The Groundwater Availability Model (GAM) developed by the Texas Water Development Board (TWDB) is used as the simulation model and the constraints on the optimization model include restrictions on drawdown at the well and in the vicinity, ensure sufficient freshwater inflows into surface water bodies including the coast and other policy considerations.  Using the estimated groundwater availability as the basis, a transportation-type optimization model is developed in the third step.  This optimization approach provides a basis for optimally allocating water from the supply centers to different demand areas.  Considerations for optimization include the distance and the gradient over which the water has to be moved.  The three-pronged methodology developed provides a basis for decision makers and regional planners to identify potential ways to meet water deficits without compromising on the ecological and environmental issues and as such promotes sustainable planning.  The developed methodology is illustrated using a case-study developed in South Texas.