Communal water storage reservoirs (embungs) that serve many villages in West Timor, Indonesia, by providing water during the prolonged annual dry season are experiencing severe sedimentation problems. Sedimentation of reservoirs progressively reduces their water storage capacity and the benefits to community. This paper investigates four alternative strategies for managing the sedimentation of a typical village embung: (1) current management (a “no management” situation), (2) soil conservation in the embung catchment, (3) periodic sediment removal and (4) both soil conservation and sediment removal. Without periodic sediment removal, an embung has a finite life dependent on the rate of sedimentation. The results indicate that periodic cleaning is clearly worthwhile. Strategy (4) gives the highest NPV. Strategy (3) was not as good, though towards the upper end of the range of reasonable discount rates, it was almost as good as strategy 4. No management is the worst strategy.