ALJ/MAB/hl2 Mailed 8/30/2005

Decision 05-08-017 August 25, 2005

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application of Riley Property Holdings LLC, Riley Mezzanine Corp., CB Riley Investor LLC, Cerberus Partners, L.P., Cerberus Associates, L.L.C., LNR Property Corporation, and Valencia Water Company (U342-W) for authorization of Riley Property Holdings LLC, Riley Mezzanine Corp., CB Riley Investor LLC, Cerberus Partners, L.P., and Cerberus Associates, L.L.C. to acquire indirect control over Valencia Water Company.

Application 04-12-016 (Filed December 16, 2004)

OPINION CONDITIONALLY APPROVING APPLICATION

Summary

In this decision we conditionally approve the transfer of 50% indirect control of Valencia Water Company (Valencia) from LNR Property Corporation (LNR) to Riley Mezzanine I Corporation (Riley I).