This study describes and demonstrates two alternate methods for evaluating the relative costs and benefits of artificial groundwater recharge using percolation ponds. The first analysis considers the benefits to be the reduction of pumping lifts and land subsidence; the second considers benefits as the alternative costs of a comparable surface delivery system. Example computations are carried out for an existing artificial recharge program in Santa Clara Valley in California. A computer groundwater model is used to estimate both the average long term and the drought period effects of artificial recharge in the study area. Results indicate that the costs of artificial recharge are considerably smaller than the alternative costs of an equivalent surface system. Refs.