RATES Per Meter

Per Month

For a single-family residence including premises,

having the following areas:

4,500 sq. ft. or less.................................................................................$ 16.33 (I)

4,501 to 8,000 sq. ft................................................................................. 22.09 (I)

For each additional residence on the same premises and served

From the same service connection.............................................................. 14.66 (I)

For each 1,000 sq. ft. or part of the area in excess of 8,000 sq. ft........................ 0.63 (I)

SPECIAL CONDITIONS:

1. The above residential flat rate charges apply to service connections not larger than ¾ inch in diameter.

(Continued)

California-American Water Company

Schedule No. SAC-2R

Sacramento Tariff Area

RESIDENTIAL FLAT RATE SERVICE

(Continued)

SPECIAL CONDITIONS:

2. All service not covered by the above classification will be furnished

only on a metered basis.

3. A meter may be installed at option of utility or customer for above

classifications in which event service thereafter will be furnished only

on the basis of Schedule No. SAC-1, General Metered Service. After

a meter is installed, metered service must be continued for at least 12

months before service will again be furnished at flat rates.

4. All bills are subject to the reimbursement fee forth in Schedule No.

UF.

5. A surcharge is included on each bill to recover undercollected pumping power costs of

$ 328,066. The pumping power surcharge is $ .483 per customer on a monthly basis.

This surcharge will be collected over twelve-month period from the effective date of

Advice Letter 578.

California-American Water Company

Rule No.11

DISCONTINUANCE AND RESTORATION OF SERVICE

(continued)

B. 2. For Noncompliance with Rules

The utility may discontinue service to any customer for violation of these rules after it has given the customer at least five days written notice of such intention. Where safety of water supply is endangered, service may be discontinued immediately without notice.

3. For Waste of Water

a. Where negligent or wasteful use of water exists on a customer's premises, the utility may discontinue the service if such practices are not remedied within five days after it has given the customer written notice to such effect.

b. In order to protect itself against serious and unnecessary waste or misuse of water, the utility may meter any flat rate service and apply the regularly established meter rates where the customer continues to misuse or waste water beyond five days after the utility has given the customer written notice to remedy such practices.

4. For Unsafe Apparatus or Where Service is Detrimental or Damaging to the Utility or its Customers.

If an unsafe or hazardous condition is found to exist on the customer's premises, or if the use of water thereon by apparatus, appliances, equipment or otherwise is found to be detrimental or damaging to the utility or its customers, the service may be shut off without notice. The utility will notify the customer immediately of the reasons for the discontinuance and the corrective action to be take by the customer before service can be restored.

5. For Fraudulent Use of Service

When the utility has discovered that a customer has obtained service by fraudulent means, or has diverted the water service for unauthorized use, the service to that customer may be discontinued without notice. The utility will not restore service to such customer until that customer has complied with all filed rules and reasonable requirements of the utility and the utility has been reimbursed for the full amount of the service rendered and the actual cost to the utility incurred by reason of the fraudulent use.

C. Restoration of Service

1. Reconnection Charge

Where service has been discontinued for violation of these rules or for nonpayment of bills, the

utility may charge $10.00 for reconnection of service during regular working hours, or $15.00

($50.00 for Felton, Larkfield, and Sacramento districts) for reconnection of service at other than (N)

regular working hours when the customer has requested that the reconnection be made at

other than regular working hours.

(continued)

(END OF APPENDIX B)

APPENDIX C

Page 1

CALIFORNIA-AMERICAN WATER COMPANY

Felton District

Test Year 2004 Increases

Each of the following increases in rates may be put into effect consistent with Ordering Paragraph No. 6.

	2004

Quantity Rates:

For all water delivered, per 100 cu. Ft. .....................	$ 0.114

Service Charge:

For 5 / 8 x 3 / 4-inch meter ........................	$ 3.30
3 / 4-inch meter .........................	$ 4.95
1-inch meter ..........................	$ 8.24
1-1 / 2-inch meter ...........................	$ 16.49
2-inch meter ...........................	$ 26.38
3-inch meter ...........................	$ 49.47
4-inch meter ...........................	$ 82.44

Private Fire Protection

4-inch and smaller	$ 2.74
6-inch ...........................	$ 4.12
8-inch ...........................	$ 5.49
10-inch ...........................	$ 11.00
12-inch ...........................	$ 15.49

APPENDIX C

Page 2

CALIFORNIA-AMERICAN WATER COMPANY

Larkfield District

Test Year 2004 Increases

Each of the following increases in rates may be put into effect on the indicated date by
filing a rate schedule which adds the appropriate increase to the rate which would otherwise be in effect on that date.


General Metered Service	2004

Quantity Rates:

For all water delivered, per 100 cu. Ft. ........................	$ 0.029

Service Charge:

For 5 / 8 x 3 / 4-inch meter ..........................	$ 1.03
3 / 4-inch meter ..........................	$ 1.54
1-inch meter ..........................	$ 2.57
1-1 / 2-inch meter ...........................	$ 5.14
2-inch meter ...........................	$ 8.23
3-inch meter ...........................	$ 15.43
4-inch meter ...........................	$ 25.72
6-inch meter ...........................	$ 51.45
8-inch meter ...........................	$ 82.31
10-inch meter ...........................	$102.89

Private Fire Service

1 1/2-inch and less	$ .20
4-inch ...........................	$ .39
6-inch ...........................	$ .59
8-inch ...........................	$ .79
10-inch ...........................	$ .99

APPENDIX C

Page 3

CALIFORNIA-AMERICAN WATER COMPANY

Sacramento District

Test Year 2004 Increases

Each of the following increases in rates may be put into effect on the indicated date by filing a rate schedule which adds the appropriate increase to the rate which would otherwise be in effect on that date.

	2004
General Metered Service

Quantity Rates:

For all water delivered, per 100 cu. Ft. ........................	$ 0.00

Service Charge:

For 5 / 8 x 3 / 4-inch meter ..........................	$ .48
3 / 4-inch meter ..........................	$ .73
1-inch meter ..........................	$ 1.21
1-1 / 2-inch meter ...........................	$ 2.42
2-inch meter ...........................	$ 3.87
3-inch meter ...........................	$ 7.25
4-inch meter ...........................	$ 12.09
6-inch meter ...........................	$ 24.17
8-inch meter ...........................	$ 38.67
10-inch meter ...........................	$ 48.34
12-inch meter ...........................	$ 55.59
Private Fire Service
4-inch and less ...........................	$ 2.93
6-inch ...........................	$ 4.89
8-inch ...........................	$ 6.88
10-inch ...........................	$ 8.54
12-inch ...........................	$ 12.25
Unmetered
4500 Sq ft or less ...........................	$ .79
4501 to 8000 Sq. ft. ...........................	$ 1.06
Each 1000 Sq. ft. or part thereof above 8000 Sq. ft. .........	$ .03
Additional House on Lot ...........................	$ .71

(END OF APPENDIX C)


APPENDIX D Page 1 CALIFORNIA-AMERICAN WATER COMPANY Felton District Adopted Quantities
	2003	2004
PURCHASED POWER:
PGE
Water Production (kCcf)	198.414	198.639
Total Kwh	355671	356073
Kwh/Ccf	1.792570081	1.792563394
Unit Cost ($/Kwh)	0.180576994	0.18057814
Total Purchased Power Cost	$64,226	$64,299



CHEMICAL COSTS:
Water Production (kCcf)	198.414	198.639
Unit Cost ($ /kCcf)	19.65587106	19.65877798
Total Chemical Cost	$3,900	$3,905


APPENDIX D Page 2 CALIFORNIA-AMERICAN WATER COMPANY Felton District Taxes Based on Income




		($000)
		Test Year 2003	Test Year 2004

Operating Revenues		990.8	1,063.0

Deductions:
	O & M expenses	153.8	158.4
	A & G Expenses	54.7	57.3
	G. O. Prorated Expenses	91.3	93.5
	Payroll	228.5	235.3
	Acquisition Premium	51.0	54.6
	Taxes not on Inc.	67.1	77.4
	Interest	71.6	84.4
	Book Depreciation	123.2	133.7

Income before taxes		149.6	168.4

California Corp. Franchise Tax
State Tax Depreciation		-	-

Taxable Income for CCFT		149.6	168.4
CCFT Rate		7.56%	7.56%

CCFT		11.3	12.7
	Less Deferred Taxes	3.8	3.8

	Total State Income Taxes	7.5	8.9

Federal Income Tax
Federal Tax Deductions		(14.1)	(7.5)

Taxable income for FIT		163.7	160.9
FIT Rate		35.00%	35.00%

	FIT	57.3	56.3
Less:
	Investment Tax Credit	-	-
	Amortization of Reg. Assets	-	-
	Deferred Taxes - U.P.A.A.	-	-
	Amort of Excess Deferred Taxes	-	-

	Total Federal Income Tax	57.3	56.3
	Total FIT and CCFT	64.8	65.2


APPENDIX D Page 3 CALIFORNIA-AMERICAN WATER COMPANY Felton District Weighted Average Depreciated Rate Base
			($000)
		Test Year 2003		Test Year 2004

WTD AVG PLANT IN SERVICE		3,479.3		4,087.9

	MATERIALS & SUPPLIES	10.3		10.5
	WORKING CASH, OPERATIONAL	0.0		48.8
	WORKING CASH, LEAD-LAG	71.3		74.7

	WTD AVG DEPR RESERVE	(937.6)		(1,044.9)

	ADVANCES	0.0		0.0
	UNAMORTIZED ADVANCES	(1.4)		(1.4)
	(20 YR AMORTIZATION)
	CONTRIBUTIONS	(9.7)		(28.9)
	UNAMORTIZED CONTRIBUTIONS	(162.5)		(153.7)
	(20 YR AMORTIZATION)
	ACCUM. DEFERRED FIT	(96.0)		(170.0)
	ACCUM. DEFERRED SIT	(22.0)		(40.0)
	GENERAL OFFICE ALLOC.
	ACRS & MACRS DEPRECIATION
	UNAMORTIZED ITC
	TAXES ON - ADVANCES
	TAXES ON - CIAC

AVERAGE RATE BASE		2,331.7		2,783.0


APPENDIX D Page 4 CALIFORNIA-AMERICAN WATER COMPANY Felton District Water Sales Per Average Customer

		(ccf)
	Test Year 2003		Test Year 2004


Residential	101.1		101.1

Commercial	298.6		298.6

Public Authority	2,205.4		2,205.4

Industrial	-		-

Irrigation	528.0		528.0


Private Fire Service	0		0


APPENDIX D Page 5 CALIFORNIA-AMERICAN WATER COMPANY Felton District Average Number of Customers

	Test Year 2003	Test Year 2004

Metered Connections

Residential	1,134	1,136
Commercial	168	168
Public Authority	6	6
Industrial	0	0
Irrigation	1	1

Total metered connections	1,309	1,311

Fire Protection connections

Private Fire Service	9	9



Total Active connections	1,318	1320

Include Fire Protection	1,318	1,320
Exclude Fire Protection	1,309	1,311


APPENDIX D Page 6 CALIFORNIA-AMERICAN WATER COMPANY Felton District Total Sales and Supply (KCCF)
	Test Year 2003	Test Year 2004

METERED SALES

Residential	114.6	114.8
Commercial	50.2	50.2
Public Authority	13.2	13.2
Industrial	-	-
Irrigation	0.5	0.5

TOTAL METERED SALES	178.6	178.8

PRIVATE FIRE SERVICE	0.0	0.0

FLAT RATE SALES	-	-

Unaccounted For Water (10%)	19.8	19.9

TOTAL DELIVERED	198.4	198.7

PRODUCTION
Creeks and Springs	198.4	198.7


Total Production	198.4	198.7


APPENDIX D Page 7 CALIFORNIA-AMERICAN WATER COMPANY Felton District Plant In Service

			($000)
		Test Year 2003		Test Year 2004

Plant in Service - BOY		3,271.4		3,579.3

Additions

	Gross Additions	322.0		627.0

	Retirements of Plant	(14.1)		(27.9)

	Net Additions	307.9		599.1

	CWIP - BOY	-		25.0

	CWIP - EOY	25.0		200.0

	Net Change - CWIP	25.0		175.0

Plant in Service - EOY		3,579.3		4,178.4

WEIGHTING FACTOR		62.44%		62.44%

WTD. AVG. PLANT IN SERVICE		3,479.3		4,087.6


APPENDIX D Page 8 CALIFORNIA-AMERICAN WATER COMPANY Felton District Depreciation Reserve & Expense

			($000)
		Test Year 2003		Test Year 2004

DEPRECIATION RESERVE - B.O.Y.		881.1		989.8

ACCRUALS
	Salvage and Cost of Removal	(0.9)		(1.7)
	Contributions	0.5		1.5
	Depreciation Expense	123.2		133.7
TOTAL ACCRUALS		122.8		133.5

RETIREMENTS		(14.1)		(27.9)

DEPRECIATION RESERVE - E.O.Y.		989.8		1,095.4

WEIGHTING FACTOR		51.98%		51.98%

WTD. AVG. DEPRECIATION RESERVE		937.6		1,044.7


APPENDIX D Page 9 CALIFORNIA-AMERICAN WATER COMPANY Felton District Number of Customers by Meter Size
			Test Year 2003		Test Year 2004

Average Customers by Meter Size
		5/8 x 3/4"	1,263		1,265
		3/4"	2		2
		1"	22		22
		1 1/2"	8		8
		2"	13		13
		3"	-		-
		4"	1		1
		6"	-	-	-
		8"	-		-


	TOTAL		1,309		1,311
Private Fire Protection
		4" and smaller	3		3
		6"	6		6
		8"	-		-
		10"	-		-
		12"	-		-

	TOTAL		9		9


APPENDIX D Page 10 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Adopted Quantities

	2003	2004
PURCHASED POWER:
PGE
Water Production (kCcf)	567.8	573.1
Total Kwh	755,227	762,162
Kwh/Ccf	1.33	1.33
Unit Cost ($/Kwh)	$ 0.1441	$ 0.1441
Total Purchased Power Cost	$ 108,834	$ 109,833


PURCHASED WATER:

Sonoma County Water Agency

Service Charge	$ 2,226	$ 2,358
Acre Feet Purchased	306.0	306.0
Unit Cost ($ / A.F.)	$ 496.67	$ 496.67	Effective 7/1/2003
Total Quantity Cost	$ 151,981	$ 151,981
Total Purchased Water Cost	$ 154,207	$ 154,339


CHEMICAL COSTS:
Water Production (kCcf)	567.8	573.1
Unit Cost ($ /kCcf)	$ 11.80	$ 12.39
Total Chemical Cost	$ 6,700	$ 7,100


APPENDIX D Page 11 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Taxes Based on Income
			($000)
		Test Year 2003		Test Year 2004

Operating Revenues		1,879.0		1,953.0

Deductions:
	O & M expenses	404.3		393.1
	A & G Expenses	72.2		62.5
	G. O. Prorated Expenses	163.6		167.4
	Payroll	188.9		195.0
Acquisition Premium		91.5		98.8
	Taxes not on Inc.	63.3		67.5
	Interest	172.9		194.2
	Book Depreciation	368.5		398.5

Income before taxes		353.8		376.0

California Corp. Franchise Tax
State Tax Depreciation		-		-

Taxable Income for CCFT		353.8		376.0
CCFT Rate		7.56%		7.56%

CCFT		26.8		28.4
	Less Deferred Taxes	-		-

	Total State Income Taxes	26.8		28.4

Federal Income Tax
Federal Tax Deductions		(6.9)		(26.8)

Taxable income for FIT		360.7		349.2
FIT Rate		35.00%		35.00%

	FIT	126.3		122.2
Less:
	Investment Tax Credit	-		-
	Amortization of Reg. Assets	-		-
	Deferred Taxes - U.P.A.A.	-		-
	Amort of Excess Deferred Taxes	-		-

	Total Federal Income Tax	126.3		122.2
	Total FIT and CCFT	153.0		150.6


APPENDIX D Page 12 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Weighted Average Depreciated Rate Base

			($000)
		Test Year 2003		Test Year 2004

WTD AVG PLANT IN SERVICE		10,864.5		11,650.6

	MATERIALS & SUPPLIES	7.0		7.0
	WORKING CASH, OPERATIONAL	21.7		15.2
	WORKING CASH, LEAD-LAG	107.7		112.6

	WTD AVG DEPR RESERVE	(2,400.3)		(2,595.2)

	ADVANCES	0.0		0.0
	UNAMORTIZED ADVANCES	(2,677.2)		(2,532.5)
	(20 YR AMORTIZATION)
	CONTRIBUTIONS	(9.7)		(28.9)
	UNAMORTIZED CONTRIBUTIONS	(279.9)		(264.7)
	(20 YR AMORTIZATION)
	ACCUM. DEFERRED FIT	(56.0)		(126.0)
	ACCUM. DEFERRED SIT	(6.0)		(9.0)
	GENERAL OFFICE ALLOC.	0.0		0.0
	ACRS & MACRS DEPRECIATION	0.0		0.0
	UNAMORTIZED ITC	0.0		0.0
	TAXES ON - ADVANCES	0.0		0.0
	TAXES ON - CIAC	0.0		0.0

AVERAGE RATE BASE		5,571.8		6,229.1


APPENDIX D Page 13 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Water Sales Per Average Customer (CCF)


	Test Year 2003	Test Year 2004


Residential	179.00	179.00
Commercial	466.90	466.90
Public Authority	1858.00	1858.00
Industrial	0.00	0.00
Irrigation	647.20	647.20


Private Fire Service	0.00	0.00


Unmetered	0.00	0.00


APPENDIX D Page 14 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Average Number of Customers


	Test Year 2003	Test Year 2004

Metered Connections

Residential	2,064	2,085
Commercial	238	240
Public Authority	7	7
Industrial	1	1
Irrigation	27	27

Total metered connections	2,337	2,360

Private Fire Service	36	36

Unmetered	0	0

Total Active connections

Including Fire Protection	2,373	2,396
Excluding Fire Protection	2,337	2,360


APPENDIX D Page 15 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Total Sales and Supply (KCCF)
	Test Year 2003	Test Year 2004

METERED SALES

Residential	369.5	373.2
Commercial	111.1	112.1
Public Authority	13.0	13.0
Industrial	-	-
Irrigation	17.5	17.5

TOTAL METERED SALES	511.1	515.8

PRIVATE FIRE SERVICE	-	-

FLAT RATE SALES	-	-

Unaccounted For Water (9.5%)	56.8	57.3

TOTAL DELIVERED	567.9	573.1

PRODUCTION
Wells	434.5	439.8
Purchased water	133.3	133.3

Total Production	567.8	573.1


APPENDIX D Page 16 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Plant In Service
			($000)
		Test Year 2003		Test Year 2004

Plant in Service - BOY		9,478.2		10,666.7

Additions

	Gross Additions	1,407.0		1,324.5

	Retirements of Plant	(218.5)		(205.7)

	Net Additions	1,188.5		1,118.8

	CWIP - BOY	452.1		759.7

	CWIP - EOY	759.7		0.0

	Net Change - CWIP	307.6		759.7

Plant in Service - EOY		10,666.7		11,785.5

WEIGHTING FACTOR		62.44%		62.44%

WTD. AVG. PLANT IN SERVICE		10,864.5		11,650.6


APPENDIX D Page 17 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Depreciation Reserve & Expense
			($000)
		Test Year 2003		Test Year 2004

DEPRECIATION RESERVE - B.O.Y.		2,314.4		2,479.7

ACCRUALS
	Salvage and Cost of Removal	(9.2)		(8.7)
	Contributions	0.2		0.0
	Depreciation Expense	368.5		398.5
	Adjust-Backflow Prevention	24.3		38.0
TOTAL ACCRUALS		383.8		427.8

RETIREMENTS		(218.5)		(205.7)

DEPRECIATION RESERVE - E.O.Y.		2,479.7		2,701.8

WEIGHTING FACTOR		51.98%		51.98%

WTD. AVG. DEPRECIATION RESERVE		2,400.3		2,595.2


APPENDIX D Page 18 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Number of Customers by Meter Size
			Test Year 2003	Test Year 2004

Average Customers by Meter Size
		5/8 x 3/4	1512	1535
		3/4	595	595
		1	144	144
		1 1/2	50	50
		2	28	28
		3	1	1
		4	6	6
		6	1	1
		8	0	0
		10	0	0

	TOTAL		2,337	2,360


APPENDIX D Page 19 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Adopted Quantities
	2003	2004
PURCHASED POWER:
PGE
Water Production (kCcf)	137.6	138.4
Total Kwh	129,344.0	130,096.0
Kwh/Ccf	0.94	0.94
Unit Cost ($/Kwh)	0.18830413	0.18830413
Power Cost	$24,356	$24,498
SMUD
Water Production (kCcf)	20,210.0	20,332.5
Total Kwh	25,055,088.7	25,206,956.5
Kwh/Ccf	1.24	1.24
Unit Cost ($/Kwh)	0.09408733	0.09408733
Power Cost	$2,357,366.4	$2,371,655.2
Total Purchased Power Cost	$2,381,722.4	$2,396,152.9
PURCHASED WATER:
CITY OF SACRAMENTO:
Annual Fixed Connection Fee	146,799.0	146,799.0
Service Charge	420.0	420.0
KCcf Purchased	943.9	970.4
Unit Cost ($ /Ccf)	0.2	0.2	Effective 7/1/03
Total Quantity Cost	199,158.3	204,760.5
Total Cost City of Sacramento	$346,377.3	$351,979.5
CITRUS HEIGHTS
Acre Feet Purchased	169.6	180.9
Unit Cost ($ / A.F.)	110.0	110.0	Effective 1/1/03
Total Quantity Cost	$18,656.0	$19,899.0
PLACER COUNTY WATER AGENCY:
Service Charge	29,322.0	29,322.0
KCcf Purchased	13.0	82.9
Unit Cost ($ /Ccf)	0.6	0.6	Effective 1/1/03
Total Quantity Cost	8,083.6	51,367.6
Total Cost Placer County	37,405.6	80,689.6
Water Management Programs	$107,784.0	$110,707.0
Total Purchased Water Cost	$510,222.8	$563,275.1
CHEMICAL COSTS:
Water Production (kCcf)	20,347.6	20,470.9
Unit Cost ($ /kCcf)	4.5	4.6
Total Chemical Cost	$91,700.0	$94,900.0


APPENDIX D Page 20 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Taxes Based on Income
				($000)
			Test Year 2003		Test Year 2004

Operating Revenues			21,680.0		22,700.0

Deductions:
	O & M expenses		4,298.5		4,420.1
	A & G Expenses		762.8		795.0
	G. O. Prorated Expenses		3,883.5		3,973.7
	Payroll		1,600.7		1,651.1
Acquisition Premium			2,174.0		2,341.9
	Taxes not on Inc.		609.0		656.7
	Interest		1,419.3		1,589.1
	Book Depreciation		3,941.5		4,203.8

Income before taxes			2,990.6		3,068.6

California Corp. Franchise Tax
State Tax Depreciation			-		-

Taxable Income for CCFT			2,990.6		3,068.6
CCFT Rate			7.56%		7.56%

CCFT			226.1		232.0
		Less Deferred Taxes	-		-

		Total State Income Taxes	226.1		232.0

Federal Income Tax
Federal Tax Deductions			(224.0)		226.1

Taxable income for FIT			3,214.6		2,842.5
FIT Rate			35.00%		35.00%

	FIT		1,125.1		994.9
Less:
	Investment Tax Credit		-		-
	Amortization of Reg. Assets		-		-
	Deferred Taxes - U.P.A.A.		-		-
	Amort of Excess Deferred Taxes		-		-
	Total Federal Income Tax		1,125.1		994.9
	Total FIT and CCFT		1,351.2		1,226.9


APPENDIX D Page 21 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Weighted Average Depreciated Rate Base

			($000)
		Test Year 2003		Test Year 2004

WTD AVG PLANT IN SERVICE		118,632.8		128,284.2

	MATERIALS & SUPPLIES	18.8		19.3
	WORKING CASH, OPERATIONAL	772.7		774.0
	WORKING CASH, LEAD-LAG	188.7		233.7

	WTD AVG DEPR RESERVE	(39,380.2)		(41,778.1)

	ADVANCES	(4,699.0)		(7,038.2)
	UNAMORTIZED ADVANCES	(20,656.7)		(19,540.1)
	(20 YR AMORTIZATION)
	CONTRIBUTIONS	(356.4)		(532.5)
	UNAMORTIZED CONTRIBUTIONS	(7,574.4)		(7,165.0)
	(20 YR AMORTIZATION)
	ACCUM. DEFERRED FIT	(1,082.6)		(1,913.1)
	ACCUM. DEFERRED SIT	(255.6)		(447.2)
	GENERAL OFFICE ALLOC.	0.0		0.0
	ACRS & MACRS DEPRECIATION	0.0		0.0
	UNAMORTIZED ITC	0.0		0.0
	TAXES ON - ADVANCES	0.0		0.0
	TAXES ON - CIAC	0.0		0.0

AVERAGE RATE BASE		45,608.1		50,896.9


APPENDIX D Page 22 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Water Sales Per Average Customer


	Test Year 2003	Test Year 2004


Residential	239.0	239.0

Commercial	981.4	981.4

Public Authority	5,531.0	5,531.0

Industrial	1,358.0	1,358.0

Irrigation	1,897.0	1,897.0


Private Fire Service	0	0


Unmetered	252.9	252.9


APPENDIX D Page 23 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Average Number of Customers


	Test Year 2003	Test Year 2004

Metered Connections

Residential	4,540	5,328
Commercial	4,317	4,351
Public Authority	86	86
Industrial	12	12
Irrigation	527	527

Total metered connections	9,482	10,304

Fire Protection connections	0	0

Private Fire Service	644	674

Unmetered	46,118	45,698

Total Active connections	56,244	56,676

Include Fire Protection	56,244	56,676
Exclude Fire Protection	55,600	56,002


APPENDIX D Page 24 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Total Sales and Supply (KCCF)


	Test Year 2003	Test Year 2004

METERED SALES

Residential	1,085.1	1,273.4
Commercial	4,236.7	4,270.1
Public Authority	475.7	475.7
Industrial	16.3	16.3
Irrigation	999.7	999.7

TOTAL METERED SALES	6,813.4	7,035.1

PRIVATE FIRE SERVICE	0.0	0.0

FLAT RATE SALES	11,663.2	11,557.0

Unaccounted For Water (9.5%)	1,939.5	1,951.6

TOTAL DELIVERED	20,416.2	20,543.8

PRODUCTION	0.0	0.0
Wells	19,385.4	19,411.7
Purchased water	1,030.8	1,132.1

Total Production	20,416.2	20,543.8


APPENDIX D Page 25 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Plant In Service

			($000)
		Test Year 2003		Test Year 2004

Plant in Service - BOY		111,893.5		119,093.3

Additions

	Gross Additions	8,217.7		14,336.8

	Retirements of Plant	(1,017.9)		(1,775.9)

	Net Additions	7,199.8		12,560.9

	CWIP - BOY	3,462.2		1,510.7

	CWIP - EOY	1,510.7		1,250.0

	Net Change - CWIP	(1,951.5)		(260.7)

Plant in Service - EOY		119,093.3		131,654.2

WEIGHTING FACTOR		62.44%		62.44%

WTD. AVG. PLANT IN SERVICE		118,632.8		128,284.2


APPENDIX D Page 26 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Depreciation Reserve & Expense

			($000)
		Test Year 2003		Test Year 2004

DEPRECIATION RESERVE - B.O.Y.		37,960.5		40,691.7

ACCRUALS
	Salvage and Cost of Removal	(200.8)		(350.2)
	Contributions	8.4		12.3
	Depreciation Expense	3,941.5		4,203.8
TOTAL ACCRUALS		3,749.1		3,865.9

RETIREMENTS		(1,017.9)		(1,775.9)

DEPRECIATION RESERVE - E.O.Y.		40,691.7		42,781.7

WEIGHTING FACTOR		0.5		0.5

WTD. AVG. DEPRECIATION RESERVE		39,380.2		41,778.1


APPENDIX D Page 27 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Number of Customers by Meter Size


			Test Year 2003	Test Year 2004

Average Customers by Meter Size
		5/8 x 3/4	4,827	5,615
		3/4	-	-
		1	1,985	1,986
		1 1/2	622	624
		2	1,908	1,940
		3	21	21
		4	78	78
		6	21	21
		8	19	19
		10	1	1

	Total		9,482	10,305

(END OF APPENDIX D)


APPENDIX E Page 1 CALIFORNIA-AMERICAN WATER COMPANY Felton District Bill Comparison
Comparison of typical bills for residential metered customers of various usage levels and
average level at present and authorized rates for the test year 2003, excluding the SDWBA surcharge

			General Metered Service
			(5/8-inch meters)

Monthly		Present		Authorized	Percent
Usage		Rates		Rates	Increase

(Ccf)

0		$13.12		$19.89	51.6%

5		$24.82		$34.36	38.4%

8.425	(avg)	$34.89		$47.03	34.8%

12		$46.35		$61.44	32.6%

20		$74.90		$97.20	29.8%


APPENDIX E Page 2 CALIFORNIA-AMERICAN WATER COMPANY Larkfield District Bill Comparison

Comparison of typical bills for residential metered customers of various usage levels and average level at present and authorized rates for the test year 2003

			General Metered Service
			(5/8-inch meters)

Monthly		Present		Authorized	Percent
Usage		Rates		Rates	Increase

(Ccf)

0		$14.00		$12.95	-7.5%

5		$23.76		$25.99	9.4%

10		$33.51		$39.02	16.4%

14.9	(Avg.)	$43.07		$51.79	20.3%

20		$53.02		$65.09	22.8%

30		$72.53		$91.16	25.7%


APPENDIX E Page 3 CALIFORNIA-AMERICAN WATER COMPANY Sacramento District Bill Comparison

Comparison of typical bills for residential metered customers of various usage
levels and average level at present and authorized rates for the test year 2003

		General Metered Service
		(5/8-inch meters)

Monthly	Present		Authorized	Percent
Usage	Rates		Rates	Increase

0	$7.75		$7.14	-7.9%

5	$11.27		$11.85	5.2%

10	$14.78		$16.55	12.0%

19.9 (avg)	$21.74		$25.87	19.0%

20	$21.81		$25.96	19.0%

30	$28.84		$35.38	22.7%

(END OF APPENDIX E)

(APPENDIX F)

In the Matter of the Application of California- ) Applications A.02-09-030

American Water Company (U210W) for an ) 02-09-031

Order Authorizing it to Increase Rates for Water) 02-09-032

Service for its Sacramento, Montara, Larkfield ) 02-09-033

and Felton Districts. )

AMENDED SETTLEMENT

1.00 GENERAL

1.01 The Parties to this Amended Settlement before the California Public Utilities Commission (Commission) are California-American Water Company ("Cal-Am") and the Office of Ratepayer Advocates ("ORA") - collectively, "the Parties." The Parties, desiring to avoid the expense, inconvenience, and uncertainty attendant to litigation of the matters in dispute between them have agreed on this Amended Settlement which they now submit for approval.

1.02 In addition, since this Amended Settlement represents a compromise by them, the Parties have entered into each Stipulation on the basis that its approval by the Commission not be construed as an admission or concession by any Party regarding any fact or matter of law in dispute in this proceeding. Furthermore, the Parties intend that the approval of this Amended Settlement by the Commission not be construed as a precedent or statement of policy of any kind for or against any Party in any current or future proceeding.

1.03 The Parties agree that no signatory to this Amended Settlement or any member of ORA assumes any personal liability as a result of their agreement. The Parties agree that no legal action may be brought by any Party in any state or federal court, or any other forum, against any individual signatory representing the interests of ORA, attorneys representing ORA, or the ORA itself related to this Amended Settlement. All rights and remedies of the Parties are limited to those available before the Commission.

1.04 No Party to this Amended Settlement should provide, either privately or publicly, before this Commission any rationale or strategy for support of any compromise reached herein beyond that stated herein unless otherwise agreed to by the Parties.

1.05 The following discussion addresses the items settled by the Parties. Attached as Appendix A to this Amended Settlement are tables which show ORA's and Cal-Am's stipulated estimates.

1.07 Differences between Cal-Am's and ORA's estimates are, for the most part (except as specifically noted), due to the findings in ORA's audit and, in some instances, due to later data available to ORA. Some stipulated expenses are the consequence

of additional discussion between ORA and Cal-Am, with results which are no greater than Cal-Am's estimates but greater than ORA's estimates.

1.08 The items which remain in disagreement are reflected in the comparison exhibit filed in this case as Exhibit No. __________ .

2.00 Sacramento District

Cal-Am agrees to accept ORA's estimates, where an agreement was reached, except for the following where a Amended Settlement was reached:

2.01 Average Consumption per Customer and Total Production

Cal-Am and ORA agree to the estimates of average consumption for each class in the Sacramento District except for residential and commercial customers. For residential customers, Cal-Am and ORA agree to an average consumption based on the average of the last three recorded years which is more reflective of the current normal use for metered customers. For commercial customers, Cal-Am and ORA agree that both of their methods for estimating consumption are valid and that an average of the two parties estimates is reflective of current usage.

Original Positions (CCFs) Amended Settlement (CCFs)

Cal-Am ORA

Residential 231.0 246.8 239.0 Commercial 975.0 987.8 981.4

The original and stipulated estimates are set forth in Tables B-1 and Tables B-2.

2.10 Operations and Maintenance Expenses

2.11 T&D Reset Meters

ORA and Cal-Am agree that T&D Reset Meter expense should be based on including some of the 1999 costs previously excluded by ORA based on a showing by the Company as to the validity thereof.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 12.8 $ 7.6 $ 10.2

2004 $ 13.2 $ 7.8 $ 10.5

2.12 T&D Meter Maintenance

ORA and Cal-Am agree that T&D Meter Maintenance Expense should be based on including some of the 1999 costs previously excluded by ORA based on a showing by the Company as to the validity thereof.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 15.5 $ 9.0 $ 12.3

2004 $ 16.0 $ 9.2 $ 12.6

2.20 Administrative and General Expenses

2.21 Labor Inflation Rate

Cal-Am and ORA agree that the labor inflation rate should be based on the current negotiated and signed union contract, for union labor, and that the same rate should be used for non-union labor based on a showing by the Company as to historical inflation rates and the current allowance for 2003, which is already been effectuated. The labor inflation rates to be used are 3.3% for 2003 and 3.0% for 2004.

2.22 Overtime and Capital Labor Pecentages

Cal-Am and ORA agree to the following overtime and capital labor percentage based on a determination that both parties used reasonable methods for estimation and that the average of the two estimates was reflective of current trends.

Original Positions (%) Amended Settlement (%)

Cal-Am ORA

Overtime 8.47% 8.03% 8.25%

Capital 9.74% 9.25% 9.50%

2.23 Group Insurance Inflation Factor

Cal-Am and ORA agree that based on current market trends, group insuance inflation rates are generally in excess of 10%, and based on this information the parties agree to use an inflation rate of 7.5% for ratemaking.

2.24 Miscellaneous General Expense

Cal-Am and ORA agree that the estimate for this account should be based on the showing by the Company as to the current level of expense for 2002 under Cal-Am ownership.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 465.1 $ 192.7 $ 232.1

2004 $ 478.4 $ 197.6 $ 237.9

2.30 Rate Base

2.31 ORA agrees with Cal-Am's position that if a capital expenditure is removed from rate base, then if any contributions for that project were received, they must likewise be removed from rate base. ORA recommends that the expenditures related to the Mather Booster should be placed in a deferred account, therefore they now recommend that the contribution of $650,000 received for this project be removed from the unamortized contributions. Cal-Am still does not agree that any projects should be removed from rate base due to third party liability for the contamination, but does agree that ORA's position is now consistent with their recommendation.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 465.1 $ 192.7 $ 232.1

2004 $ 478.4 $ 197.6 $ 237.9

3.00 Montara District

Cal-Am agrees to accept ORA's estimates, where an agreement was reched, except for the following where a Amended Settlement was reached:

3.01 Average Consumption per Customer and Total Production

Cal-Am and ORA agree to the estimates of average consumption for each class in the Montara District except for residential and commercial customers. For residential customers, Cal-Am and ORA agree to an average consumption based on the average of the last three recorded years which is more reflective of the current normal use for metered customers. For commercial customers, Cal-Am and ORA agree that both of their methods for estimating consumption are valid and that an average of the two parties estimates is reflective of current usage.

Original Positions (CCFs) Amended Settlement (CCFs)

Cal-Am ORA

Residential 92.5 98.1 93.9 Commercial 336.0 360.3 348.2

The original and stipulated estimates are set forth in Tables B-1 and Tables B-2.

3.10 Operations and Maintenance Expenses

3.11 Water Treatment Expense

ORA and Cal-Am agree that water treatment expense should be based on including some of the 1999 costs previously excluded by ORA based on a showing by the Company as to the validity thereof.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 36.5 $ 31.7 $ 34.1

2004 $ 37.5 $ 32.5 $ 35.0

3.20 Administrative and General Expenses

3.21 Labor Inflation Rate

3.22 Overtime and Capital Labor Pecentages

Original Positions (%) Amended Settlement (%)

Cal-Am ORA

Overtime 15.37% 17.01% 16.19%

Capital 7.57% 7.55% 7.56%

3.23 Group Insurance Inflation Factor

4.00 Larkfield District

Cal-Am agrees to accept ORA's estimates, where an agreement was reached, except for the following where a Amended Settlement was reached:

4.01 Average Consumption per Customer and Total Production

Cal-Am and ORA agree to the estimates of average consumption for each class in the Larkfield District except for residential, commercial and irrigation customers. For all of these customers, Cal-Am and ORA agree that both of their methods for estimating consumption are valid and that an average of the two parties estimates is reflective of current usage.

Original Positions (CCFs) Amended Settlement (CCFs)

Cal-Am ORA

Residential 176.5 182.2 179.0 Commercial 465.0 468.9 466.9

Irrigation 637.3 657.0 647.2

The original and stipulated estimates are set forth in Tables B-1 and Tables B-2.

4.10 Operations and Maintenance Expenses

4.11 Water Treatment Expense

ORA and Cal-Am agree that water treatment expense should be based on including some of the 1999 costs previously excluded by ORA based on a showing by the Company as to the validity thereof.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 23.9 $ 18.9 $ 20.6

2004 $ 24.6 $ 19.4 $ 20.9

4.12 T&D Service Maintenance

ORA and Cal-Am agree that T&D Service Maintenance Expense should be based on including some of the 1999 costs previously excluded by ORA based on a showing by the Company as to the validity thereof.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 20.1 $ 11.4 $ 15.8

2004 $ 20.7 $ 11.7 $ 16.2

4.20 Administrative and General Expenses

4.21 Labor Inflation Rate

4.22 Overtime and Capital Labor Percentages

Original Positions (%) Amended Settlement (%)

Cal-Am ORA

Overtime 11.29% 10.55% 10.92%

Capital 7.59% 8.69% 8.14%

4.23 Group Insurance Inflation Factor

4.30 Plant in Service

4.31 Wickiup Bridge Main Project

Based on a showing by the Company that extensive workpapers were supplied for this project, including theLarkfield Master Plan, and that the project was complete and in service, ORA agreed to Cal-Am's request that this project be included in rate base at the actual cost of construction of $140,453.

4.32 Construct New North Wickiup Tank No. 2

Based on a showing by the Company that extensive workpapers were supplied for this project, including theLarkfield Master Plan, and the shortage of storage in the area, ORA agreed to Cal-Am's request that this project be included in rate base at the estimated cost of construction of $300,000.

5.00 Felton District

Cal-Am agrees to accept ORA's estimates, where an agreement was reached, except for the following where a Amended Settlement was reached:

5.01 Average Consumption per Customer and Total Production

Cal-Am and ORA agree to the estimates of average consumption for each class in the Felton District except for residential, commercial and public authority customers. For all of these customers, Cal-Am and ORA agree that both of their methods for estimating consumption are valid and that an average of the two parties estimates is reflective of current usage.

Original Positions (CCFs) Amended Settlement (CCFs)

Cal-Am ORA

Residential 100.3 103.0 101.1 Commercial 293.3 303.9 298.6

Public Authority 2,056.0 2,354.7 2,205.4

The original and stipulated estimates are set forth in Tables B-1 and Tables B-2.

5.10 Operations and Maintenance Expenses

5.11 Water Treatment Expense

ORA and Cal-Am agree that the Company's estimate of water treatment expense is more reflective of current needs based on including some of the 1999 costs previously excluded by ORA (based on a showing by the Company as to the validity thereof), and based on the level of expense in 2002 due to changing treatment requirements.

Original Positions (000s) Amended Settlement (000s)

Cal-Am ORA

2003 $ 25.2 $ 22.0 $ 25.2

2004 $ 25.9 $ 22.6 $ 25.9

5.20 Administrative and General Expenses

5.21 Labor Inflation Rate

5.22 Overtime and Capital Labor Pecentages

Original Positions (%) Amended Settlement (%)

Cal-Am ORA

Overtime 11.29% 10.55% 10.92%

Capital 7.59% 8.69% 8.14%

5.23 Group Insurance Inflation Factor

OFFICE OF RATEPAYER ADVOCATES

By ______________________________
Raymond A Charvez
Project Manager for Office of Ratepayer Advocates

State of California

Public Utilities Commission

505 Van Ness Avenue

San Francisco, CA 94102

(415) 703-1654

Dated: May 9, 2003

CALIFORNIA-AMERICAN WATER COMPANY

By: _________________________________
David P. Stephenson
Assistant Treasurer for California-American Water Company

California-American Water Company

303 H Street, Suite 250

Chula Vista, CA 91910

(619) 409-7712

Dated: May 9, 2003

(END OF APPENDIX F)

CERTIFICATE OF SERVICE

I certify that I have by regular mail and e-mail this day served a true copy of the Alternate Proposed Decision of Commissioner Kennedy on A.02-09-030 regarding the Application of the California-American Water Company (U210W) Authority to Increase Its rates for Water Service in its Sacramento District etc, on all parties of record in this proceeding or their attorneys of record.

Dated April 22, 2004, at San Francisco, California.

Halina Marcinkowski

NOTICE

Parties should notify the Process Office, Public Utilities Commission, 505 Van Ness Avenue, Room 2000, San Francisco, CA 94102, of any change of address to insure that they continue to receive documents. You must indicate the proceeding number on the service list on which your name appears.

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

The Commission's policy is to schedule hearings (meetings, workshops, etc.) in locations that are accessible to people with disabilities. To verify that a particular location is accessible, call: Calendar Clerk (415) 703-1203.

If specialized accommodations for the disabled are needed, e.g., sign language interpreters, those making the arrangements must call the Public Advisor at (415) 703-2074 or TDD# (415) 703-2032 five working days in advance of the event.

RATES Per Meter

General Metered Service

Private Fire Service