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As watersheds are urbanized, the amount of impervious surfaces will be increased. As such, water infiltration will be reduced, and the volume of surface runoff will be increased. By retaining stormwater, best management practices (BMPs) are used to mitigate the hydrologic effects of urbanization. Using the Ludlow watershed in northern Kentucky as a case study, the main objective of this paper was to identify the most cost-effective arrangement of BMPs in reducing surface runoff. A simulation program was employed to model the hydrologic conditions in the Ludlow watershed under the current and future climate conditions and to identify the most cost-effective BMP arrangement. The results show that the simulation program is an effective tool in simulating a small watershed. Indeed, BMPs are instrumental in reducing surface runoff even when the future climate becomes drier. The most cost-effective BMP arrangement is to install two infiltration trenches and one bioretention in the watershed. These findings can be useful in watershed management in areas with similar hydroclimatic conditions. [ABSTRACT FROM AUTHOR]