A team of scientists from Makerere University, Faculty of Agriculture, participated in the TOA workshop held in Nairobi in September, 2004. The Makerere team, led by Imelda Nalukenge, is developing a TOA application based on the Nutrient Monitoring data collected in the Pallisa district of southeastern Uganda. The goals of this activity are to develop the capability at Makerere to use TOA for agricultural and environmental policy analysis in Uganda. This activity is being supported by the SM-CRSP and also by a grant from the Food and Agriculture Organization’s program on Payments for Environmental Services (PES). The Pallisa study will assess the potential for using payments to farmers as incentives to protect wetlands and water quality, as an alternative to conventional forms of environmental regulation and agricultural subsidy policies. A workshop and field trip were held in February, 2005, to begin implementation of the Pallisa modeling work. A planning workshop with stakeholders to assess the potential for PES was held March 8, 2006 in Pallisa. Results from the analysis were presented at a learning workshop on PES at the meetings of the International Association of Agricultural Economists, Brisbane, Australia, August 2006. A final stakeholder meeting will be held in Kampala.