The management of river basins is complex especially when decisions about environmental flows are considered in addition to those concerning urban and agricultural water demand. The solution to these complex decision problems requires the use of mathematical techniques that are formulated to take into account conflicting objectives. Many optimization models exist for water management systems but there is a knowledge gap in linking bio-economic objectives with the optimum use of all water resources under conflicting demands. The efficient operation and management of a network of nodes comprising storages, canals, river reaches and irrigation districts under environmental flow constraints is challenging. Minimization of risks associated with agricultural production requires accounting for uncertainty involved with climate, environmental policy and markets. Markets and economic criteria determine what crops farmers would like to grow with subsequent effect on water resources and the environment. Due to conflicts between multiple goal requirements and the competing water demands of different sectors, a multi-criteria decision-making (MCDM) framework was developed to analyze production targets under physical, biological, economic and environmental constraints. This approach is described by analyzing the conflicts that may arise between profitability, variable costs of production and pumping of groundwater for a hypothetical irrigation area.