Imagining restoration in this damaged landscape requires optimism of the highest order. Relentless residential and commercial development upstream -- with its attendant buildings, pavement and storm drains -- has significantly altered runoff patterns and increased the stormwater entering local waterways. As a result, restoration and flood-control work along these lower reaches can be undermined by what happens far upstream.

But some are trying to find new ways to understand and attack these complicated problems. Phil Stevens' "Creeks 2.0" ideas about collaborative watershed management seem to resonate with those of the county water bureaucracy. Engineer Mitch Avalon of the Contra Costa Flood Control District has recently begun drafting a 50-year plan for replacing aging flood-control infrastructure with natural stream corridors. The plan recommends acquiring and removing homes in flood-prone sections -- never an easy sell. With enough lead time, however, Avalon says that even the sticky issue of eminent domain can be overcome: "Over a 50-year period, almost every house will turn over on its own accord. The city can buy them as they come up for sale and rent them out until it is ready to renovate the creek."

But even the best-laid plans can bump up against economic reality, as California's watershed groups are finding out. With the state's budget crisis, environmental work has largely fallen off the table. Last December, as California legislators wrangled over a $42 billion shortfall, the state froze its bond funds. Nowhere has the impact been felt more acutely than at California's environmental nonprofits, which are almost entirely funded by those bonds. "A lot of restoration work has just stopped in its tracks," says Dale Hopkins at the San Francisco regional water board.

February's federal economic stimulus includes $340 million for nationwide watershed rehabilitation and flood prevention and $50 million for ecosystem restoration in the San Francisco Bay-Delta. It also injects $280 million into California's clean water fund, some of which is meant as a stopgap for water restoration groups until the state starts issuing bonds again. But that portion accounts for less than half of California's $167 million budget for watershed restoration, and the money has gone mostly to construction firms for "shovel-ready" projects, rather than to conservation and planning-oriented organizations like the watershed groups.

To make matters worse, the crash of the bond market has made funding for future conservation work even more uncertain. As a result, says Riley, many community watershed groups could permanently shut down. "Some of these groups have been in existence for 25 or 30 years. That's where your institutional memory and ground workforce is," she says. For many of California's smaller watersheds, these community groups are the only organizations doing monitoring and conservation work. "If you lose continuity," Riley says, "it's very hard to recreate momentum and organization."

Restoration activists seem to have found a sympathetic ear in the United States Congress. The Water Quality Investment Act, which passed the House in March and awaits a vote in the Senate, could allocate $18.7 billion to states over the next five years for "watershed approaches to solving water quality problems." The bill outlines another $1.8 billion for sewer overflow control grants and includes funding provisions for "economically distressed" neighborhoods. According to the Web site of Speaker of the House Nancy Pelosi, D-Calif., these investments in waterway restoration and flood control could translate to 300,000 jobs nationwide.