You may ask "What is the Climatic Water Deficit Toolbox?". In a nutshell, it is a toolbox that runs in ArcGIS that calculates potential and actual evapotranspiration based on a Thornthwaite water balance approach and water supply as the sum of snowmelt and rainfall. In essence, it quantifies the demand that a plant experiences on water (potential evapotranspiration), the supply of water (water supply), and the amount of biological activity expected given the limitation of water (actual evapotranspiration). The unmet demand (difference between potential and actual evapotranspiration) is referred to as the climatic water deficit. The tool uses PRISM climate data (30 year normals or monthly rasters) plus SSURGO soils for available water supply and a DEM to incorporate the effects of fine-scale variation in solar radiation on potential evapotranspiration. The tool accounts for snowpack and soil water storage, runs on a monthly time scale, but does not simulate movement of water through the soil (e.g. groundwater model) nor does it measure actual evapotranspiration via remote sensing. Despite these limitations, the approach is expected to provide a more proximate measure of water stress on plants compared to just using temperature and precipitation variables.
For those interested I highly recommend reading the following papers: