03/12/04, 12:20 PM

EXHIBIT 4.2

                           CERTIFICATE OF DESIGNATIONS

                     SERIES D PARTICIPATING PREFERRED STOCK

                                       OF

                      CALIFORNIA WATER SERVICE GROUP, INC.

            (Pursuant to Section 151 of the General Corporation Law
                            of the State of Delaware)

               California Water Service Group, Inc., a corporation organized and
       existing under the General  Corporation Law of the State of Delaware (the
       "Corporation"),  in  accordance  with the  provisions  of Section  151(g)
       thereof,

               HEREBY CERTIFIES:

               1. On August 18, 1999, the Board of Directors of the  Corporation
       adopted a resolution  designating  221,000  shares of Preferred  Stock as
       Series D Participating Preferred Stock.

               2. No shares of Series D Participating  Preferred Stock have been
       issued.

               3.  Pursuant  to  the  authority  conferred  upon  the  Board  of
       Directors by the Certificate of  Incorporation  of the  Corporation,  the
       following resolution was duly adopted by the Board of Directors on August
       18, 1999  creating the series of Preferred  Stock  designated as Series D
       Participating Preferred Stock:

               RESOLVED, that the Board of Directors,  pursuant to the authority
       vested in the Board of Directors of this  Corporation in accordance  with
       the provisions of its Certificate of Incorporation, a series of Preferred
       Stock  of  the  Corporation  be and  hereby  is  created,  and  that  the
       determination  and amount thereof and the voting powers,  preferences and
       relative, participating,  optional and other special rights of the shares
       of such  series,  and the  qualifications,  limitations  or  restrictions
       thereof are as follows:

               "Series D Participating Preferred Stock":

               Paragraph 1.  Designation  and Amount.  The shares of such series
       shall be designated  as "Series D.  Participating  Preferred  Stock" (the
       "Series D  Preferred  Stock") and the number of shares  constituting  the
       Series D Preferred Stock shall be 221,000 and its part value is $0.01 per
       share.  Such number of shares may be increased or decreased by resolution
       of the Board of Directors prior to the issuance of any Series D Preferred
       Stock.

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               Paragraph 2. Dividends and Distributions.

               (A)  Subject  to the  rights of the  holders of any shares of any
       series  of  Preferred  Stock (or any  similar  stock)  ranking  prior and
       superior to the Series D Preferred  Stock with respect to dividends,  the
       holders  of shares of Series D  Preferred  Stock,  in  preference  to the
       holders  of Common  Stock,  no par value  (the  "Common  Stock"),  of the
       Corporation, and of any other junior stock, shall be entitled to receive,
       as and when  declared by the Board of Directors out of the surplus or net
       profits, dividends payable in cash on the same date as dividends upon the
       Corporation's  Series C (each such payment  date  referred to herein as a
       "Dividend  Payment  Date") and in the same manner as  dividends  upon the
       Corporation's  Series C,  commencing on the first  Dividend  Payment Date
       after the first  issuance  of a share or  fraction of a share of Series D
       Preferred  Stock,  in an amount per share  (subject to the  provision for
       adjustment  hereinafter  set forth) equal to 100 times the  aggregate per
       share amount of all cash dividends, and 100 times the aggregate per share
       amount   (payable   in  kind)  of  all   non-cash   dividends   or  other
       distributions, other than a dividend payable in shares of Common Stock or
       a  subdivision  of  the  outstanding  shares  of  the  Common  Stock  (by
       reclassification  or  otherwise),  declared on the Common Stock since the
       immediately preceding Dividend Payment Date or, with respect to the first
       Dividend  Payment Date, since the first issuance of any share or fraction
       of a share of Series D Preferred Stock. If the Corporation  shall fail to
       pay any such  dividends  upon all the  issued  and  outstanding  Series D
       Preferred  Stock,  the  deficiency  in dividends  shall be fully paid but
       without  interest  before any dividends shall be set apart or paid on the
       Common Stock. In the event the  Corporation  shall at any time declare or
       pay any dividend on the Common Stock  payable in shares of Common  Stock,
       or  effect  a  subdivision  or  combination  or   consolidation   of  the
       outstanding shares of Common Stock (by reclassification or otherwise than
       by  payment of a dividend  in shares of Common  Stock)  into a greater or
       lesser  number  of shares  of  Common  Stock,  then in each such case the
       amount  to which  holders  of shares of  Series D  Preferred  Stock  were
       entitled  immediately  prior to such event under the  preceding  sentence
       shall be adjusted by multiplying such amount by a fraction, the numerator
       of which is the number of shares of Common Stock outstanding  immediately
       after such event and the  denominator of which is the number of shares of
       Common Stock that were outstanding immediately prior to such event.

               (B) The  Corporation  shall declare a dividend or distribution on
       the  Series  D  Preferred  Stock as  provided  in  paragraph  (A) of this
       Paragraph 2 immediately  after it declares a dividend or  distribution on
       the  Common  Stock  (other  than a  dividend  payable in shares of Common
       Stock).

               (C)  The  Board  of  Directors  may  fix a  record  date  for the
       determination  of holders of shares of Series D Preferred  Stock entitled
       to receive payment of a dividend or distribution declared thereon,  which
       record  date shall be not less than 10 nor more than 60 days prior to the
       date fixed for the payment thereof.

               Paragraph  3.  Voting  Rights.  The holders of shares of Series D
       Preferred Stock shall have the following voting rights:

               (A)  Subject to the  provision  for  adjustment  hereinafter  set
       forth,  each share of Series D Preferred  Stock shall  entitle the holder
       thereof  to  100  votes  on  all  matters  submitted  to a  vote  of  the
       stockholders of the  Corporation.  In the event the Corporation  shall at
       any time  declare  or pay any  dividend  on the Common  Stock  payable in
       shares of  Common  Stock,  or  effect a  subdivision  or  combination  or
       consolidation   of  the   outstanding   shares   of   Common   Stock  (by
       reclassification  or otherwise than by payment of a dividend in shares of
       Common  Stock) into a greater or lesser number of shares of Common Stock,
       then in each such case the number of votes per share to which  holders of
       shares of Series D Preferred  Stock were  entitled  immediately  prior to
       such an event shall be adjusted by multiplying such number by a fraction,
       the  numerator  of  which  is  the  number  of  shares

<PAGE>

       of  Common  Stock  outstanding  immediately  after  such  event  and  the
       denominator  of which is the  number of shares of Common  Stock that were
       outstanding immediately prior to such event.

               (B) Except as otherwise provided herein, in any other Certificate
       of  Amendment to the  Certificate  of  Incorporation  or  Certificate  of
       Designations  creating a series of Preferred  Stock or any similar stock,
       or by law,  the  holders  of shares of Series D  Preferred  Stock and the
       holders  of  shares of Common  Stock and any other  capital  stock of the
       Corporation having general voting rights shall vote together as one class
       on all matters submitted to a vote of stockholders of the Corporation.

               (C) Except as set forth herein, or as otherwise  provided by law,
       holders of Series D Preferred  Stock shall have no special  voting rights
       and their  consent  shall not be required  (except to the extent they are
       entitled to vote with  holders of Common  Stock as set forth  herein) for
       taking any corporate action.

               Paragraph 4. Certain Restrictions.

               (A)  Whenever   quarterly   dividends   or  other   dividends  or
       distributions  payable on the Series D  Preferred  Stock as  provided  in
       Paragraph 2 are in arrears,  thereafter  and until all accrued and unpaid
       dividends and distributions, whether or not declared, on shares of Series
       D  Preferred  Stock  outstanding  shall  have  been  paid  in  full,  the
       Corporation shall not:

                           (i)  declare  or pay  dividends,  or make  any  other
               distributions,  on any shares of stock ranking  junior (either as
               to dividends or upon  liquidation,  dissolution or winding up) to
               the Series D Preferred Stock;

                           (ii)  declare  or pay  dividends,  or make any  other
               distributions, on any shares of stock ranking on a parity (either
               as to dividends or upon  liquidation,  dissolution or winding up)
               with the Series D Preferred Stock,  except dividends paid ratably
               on the  Series D  Preferred  Stock and all such  parity  stock on
               which  dividends  are payable or in arrears in  proportion to the
               total  amounts to which the  holders of all such  shares are then
               entitled;

                           (iii)  redeem or  purchase or  otherwise  acquire for
               consideration  shares of any stock ranking  junior  (either as to
               dividends or upon liquidation,  dissolution or winding up) to the
               Series D Preferred  Stock,  provided that the  Corporation may at
               any time redeem, purchase or otherwise acquire shares of any such
               junior  stock  in  exchange  for  shares  of  any  stock  of  the
               Corporation  ranking  junior  (either  as to  dividends  or  upon
               dissolution, liquidation or winding up) to the Series D Preferred
               Stock; or

                           (iv)  redeem or  purchase  or  otherwise  acquire for
               consideration  any  shares of Series D  Preferred  Stock,  or any
               shares of stock  ranking on a parity  with the Series D Preferred
               Stock, except in accordance with a purchase offer made in writing
               or by  publication  (as  determined by the Board of Directors) to
               all  holders  of such  shares  upon  such  terms as the  Board of
               Directors,  after consideration of the respective annual dividend
               rates and other relative rights and preferences of the respective
               series and classes,  shall determine in good faith will result in
               fair and  equitable  treatment  among  the  respective  series or
               classes.

               (B) The  Corporation  shall  not  permit  any  subsidiary  of the
       Corporation to purchase or otherwise acquire for consideration any shares
       of stock of the Corporation unless the Corporation could, under paragraph
       (A) of this  Paragraph 4,  purchase or  otherwise  acquire such shares at
       such time and in such manner.

               Paragraph 5. Reacquired  Shares. Any shares of Series D Preferred
       Stock  purchased or otherwise  acquired by the  Corporation in any manner
       whatsoever  shall be retired and canceled

<PAGE>

       promptly after the acquisition  thereof. All such shares shall upon their
       cancellation become authorized but unissued shares of Preferred Stock and
       may be reissued as part of a new series of Preferred Stock subject to the
       conditions  and  restrictions  on  issuance  set  forth  herein,  in  the
       Certificate of Incorporation, or in any other Certificate of Amendment to
       the Certificate of Incorporation or Certificate of Designations  creating
       a series of Preferred Stock or any similar stock or as otherwise required
       by law.

               Paragraph  6.  Liquidation,  Dissolution  or Winding Up. Upon any
       liquidation,   dissolution   or  winding  up  of  the   Corporation,   no
       distribution  shall be made (1) to the holders of shares of stock ranking
       junior  (either  as to  dividends  or upon  liquidation,  dissolution  or
       winding up) to the Series D Preferred  Stock unless,  prior thereto,  the
       holders  of shares of Series D  Preferred  Stock  shall  have  received a
       minimum of $100.00 per share,  plus an amount equal to accrued and unpaid
       dividends and distributions thereon, whether or not declared, to the date
       of such  payment,  provided  that  the  holders  of  shares  of  Series D
       Preferred  Stock  shall be entitled  to receive an  aggregate  amount per
       share,  subject to the provision for  adjustment  hereinafter  set forth,
       equal to 100 times the aggregate  amount to be  distributed  per share to
       holders  of shares of Common  Stock,  or (2) to the  holders of shares of
       stock  ranking on a parity  (either as to dividends or upon  liquidation,
       dissolution  or winding  up) with the Series D  Preferred  Stock,  except
       distributions  made ratably on the Series D Preferred  Stock and all such
       parity stock in  proportion  to the total amounts to which the holders of
       all such  shares  are  entitled  upon such  liquidation,  dissolution  or
       winding up. In the event the Corporation shall at any time declare or pay
       any dividend on the Common Stock  payable in shares of Common  Stock,  or
       effect a subdivision or combination or  consolidation  of the outstanding
       shares of Common Stock (by  reclassification or otherwise than by payment
       of a dividend in shares of Common  Stock) into a greater or lesser number
       of shares of Common Stock, then in each such case the aggregate amount to
       which  holders  of shares  of  Series D  Preferred  Stock  were  entitled
       immediately  prior to such event  under the  proviso in clause (1) of the
       preceding  sentence  shall be  adjusted by  multiplying  such amount by a
       fraction  the  numerator of which is the number of shares of Common Stock
       outstanding  immediately after such event and the denominator of which is
       the number of shares of Common  Stock that were  outstanding  immediately
       prior to such event.

               Paragraph 7. Consolidation,  Merger, etc. In case the Corporation
       shall  enter  into  any  consolidation,   merger,  combination  or  other
       transaction  in which the  shares of Common  Stock are  exchanged  for or
       changed into other stock or securities,  cash and/or any other  property,
       then in any such case each share of Series D Preferred Stock shall at the
       same time be  similarly  exchanged  or changed  into an amount per share,
       subject to the provision for adjustment  hereinafter set forth,  equal to
       100 times the  aggregate  amount of stock,  securities,  cash  and/or any
       other property  (payable in kind),  as the case may be, into which or for
       which each share of Common  Stock is changed or  exchanged.  In the event
       the  Corporation  shall at any time  declare or pay any  dividend  on the
       Common Stock payable in shares of Common  Stock,  or effect a subdivision
       or combination or consolidation of the outstanding shares of Common Stock
       (by reclassification or otherwise than by payment of a dividend in shares
       of  Common  Stock  into a greater  or  lesser  number of shares of Common
       Stock),  then in each such  case the  amount  set forth in the  preceding
       sentence  with  respect to the  exchange  or change of shares of Series D
       Preferred  Stock  shall be  adjusted  by  multiplying  such  amount  by a
       fraction,  the numerator of which is the number of shares of Common Stock
       outstanding  immediately after such event and the denominator of which is
       the number of shares of Common  Stock that were  outstanding  immediately
       prior to such event.

               Paragraph 8.  Redemption.  The shares of Series D Preferred Stock
       may be redeemed at the option of the Corporation in whole or in part upon
       any  Dividend   Payment  Date  and  in  the  manner   prescribed  in  the
       Corporation's Certificate of Incorporation,  upon at least 30 days notice
       to the holder of record thereof at a redemption  price per share equal to
       100  times  the fair  market  value  of one  common  share on such  date,
       together with all accrued dividends on the Series D Preferred Stock.

<PAGE>

               Paragraph 9. Rank.  The Series D Preferred  Stock shall rank, (i)
       with  respect to the  payment of  dividends  in parity  with the Series C
       Preferred  Stock and (ii) with  respect  to the  distribution  of assets,
       junior to all other series of the Corporation's preferred shares.

               Paragraph 10. Amendment.  The Certificate of Incorporation  shall
       not be amended in any manner which would  materially  alter or change the
       powers,  preferences or special rights of the Series D Preferred Stock so
       as to affect  them  adversely  without,  in addition to any other vote of
       stockholders  required by law, the affirmative  vote of the holders of at
       least a majority of the outstanding  shares of Series D Preferred  Stock,
       voting together as a single class.

               Paragraph 11. Fractional Shares. The Series D Preferred Stock may
       be issued in  fractions  of a share  which shall  entitle the holder,  in
       proportion to such holder's fractional shares, to exercise voting rights,
       receive  dividends,  participate in distributions and to have the benefit
       of all other rights of holders of the Series D Preferred Stock."

<PAGE>

               IN WITNESS  WHEREOF,  California  Water Service  Group,  Inc. has
       caused this  certificate  to be duly executed this 14th day of September,
       1999.

                                     CALIFORNIA WATER SERVICE GROUP, INC.


                                     By:  /s/Peter C. Nelson
                                          Peter C. Nelson
                                          President and Chief Executive Officer

       Attest:

       /s/Paul Ekstrom
       Paul Ekstrom
       Secretary