Now, you dig along the contour line, creating a ditch, and dumping the dirt downhill to create a berm. A ditch on contour is called a swale. This swale will hold water for a short time after a storm: long enough to let it soak in, but too short to harbor mosquitoes. Anything you plant on the berm (fruit trees, perhaps) will have a ready source of underground water, yet be on a slightly raised bed for good drainage. You can put swales all the way down the hill, 10 feet apart and capture a good amount of the water as it goes downhill. Slowing the water prevents erosion, and allows any soil picked up to settle out and stay on your land.