Exhibit 10.3


                          SAN JOSE WATER COMPANY
                      SPECIAL DEFERRAL ELECTION PLAN

                          PLAN AMENDMENT NO. 2
                          ____________________


     The San Jose Water Company Special Deferral Election Plan
(the "Plan"), as previously adopted and approved by the
Executive Compensation Committee of the Board of Directors of
SJW. Corp. and subsequently amended by such committee in
December 2004, is hereby further amended as follows:

     1.  Article VI of the Plan is hereby amended in its
entirety to read as follows:

                               ARTICLE VI
                               __________

                           INVESTMENT RETURN
                           _________________

         6.01  Investment Return for 2005 Calendar Year.  For
the period commencing January 1, 2005 and ending December 31,
2005 (the "2005 Investment Year"), the Participant's Deferral
Election Subaccount for the 2005 Plan Year and/or the Deferral
Election Subaccount attributable to his or her March 2005 Bonus
Payment shall be adjusted periodically to reflect the earnings,
gains and losses equal to the actual investment experience
realized for the period by one or more of the investment funds
selected by the Participant from the investment alternatives
identified in Appendix I. The initial selection of the
applicable investment funds for such subaccount must be made
prior to the start of the 2005 Investment Year. On each day on
which the U.S. financial markets are open during the 2005
Investment Year, the Participant's Deferral Election Subaccount
for the 2005 Plan Year and/or the Deferral Election Subaccount
attributable to his or her March 2005 Bonus Payment shall be
adjusted to reflect the investment gains, earnings or losses
those subaccounts would have actually realized had they been
invested on that day in the selected investment funds.

         6.02  Reallocation of Account Balances Between Funds.
A Participant may elect at any time during the 2005 Investment
Year to reallocate (in such percentages as the Plan
Administrator shall authorize) part or all of the balance of his
or her Deferral Election Subaccount for the 2005 Plan Year
and/or the Deferral Election Subaccount attributable to his or
her March 2005 Bonus Payment among the available investment
alternatives.  Such election shall be made on a form provided by
the Plan Administrator, and the designated reallocation shall be
effected as soon as reasonably practicable after the filing of
such form with the Plan Administrator or its designate.

         6.03  Investment Return for Subsequent Calendar Years.
Commencing January 1, 2006 and continuing throughout the period
there remains an outstanding balance credited to such
subaccount, each of the Participant's Deferral Election
Subaccounts shall be credited with a fixed rate of interest,
compounded semi-annually and periodically reset in accordance
with the following procedures:

         -  For each Plan Year, beginning with the 2006 Plan
Year, the fixed rate of interest shall be equal to the then
current 30-year long-term borrowing cost of funds to San Jose
Water Company  (or the equivalent thereof), as measured as of
the start of such Plan Year.

         Both the Deferral Election Subaccount maintained for
each Participant for the 2005 Plan Year and his or her Deferral
Election Subaccount (if any) attributable to his or her March
2005 Bonus Payment shall be valued as of December 31, 2005 in
accordance with the investment adjustment provisions of Section
6.01 and the valuation procedures of Section 6.05, and that
balance, together with the Deferral Election Subaccounts for all
subsequent Plan Years, shall thereafter be credited with a fixed
rate of interest in accordance with the provisions of this
Section 6.03.

         6.04  Charges to Account.  Each of the Participant's
Deferral Election Subaccounts shall be charged with its
allocable share of the costs and expenses incurred in connection
with the administration of the investment return and
reallocation provisions of this Article VI, except to the extent
one or more Participating Employers elect in their sole
discretion to pay all or a portion of those costs and expenses.

         6.05  Account Value.  The value of each of the
Participant's Deferral Election Subaccounts on any Valuation
Date in question shall be equal to the balance credited to that
subaccount as of the close of business on that date, including
the appropriate adjustments for (i) any deferred Eligible
Earnings or investment gains or earnings or interest return
credited to such subaccount as of such date and (ii) any
distributions, hardship withdrawals or investment losses charged
against the subaccount as of such date.

         6.06  Account Statements.  Following the close of each
calendar quarter, each Participant shall receive a written
statement of the value of each of his or her Deferral Election
Subaccounts as of the last Valuation Date in that quarter.

         6.07  No Required Investment.  Although the investment
return on each of the Participant's Deferral Election
Subaccounts for the 2005 Investment Year is to be measured by
the actual gains, earnings and losses realized by one or more of
the investment alternatives selected by the Participant pursuant
to this Article VI, neither the Corporation nor any
Participating Employer shall be under any obligation to make the
selected investments, and the investment experience shall only
be tracked as debits or credits to the Participant's book
accounts over the deferral period.  To the extent the
Corporation or any Participating Employer should elect to make
any actual investments, the purchaser Corporation or
Participating Employer shall be the sole and exclusive owner of
those investments, and no Participant shall have any right,
title or interest in or to those investments.


     2.  There is hereby added to Article VIII of the Plan new
Section 8.10 as follows:

         "8.10  Special Termination Election Subaccounts.  Each
Participant with a Deferral Election Subaccount for the 2005
Plan Year and/or a Deferral Election Subaccount attributable to
his or her March 2005 Bonus Payment shall have the right to make
a special election on or before November 30, 2005 to have the
balance credited to either or both of those subaccounts as of
December 15, 2005 (as determined in accordance with Sections
6.01 and 6.05) distributed to him or her in a lump sum on or
before December 31, 2005. The election can only be made by
filing the appropriate election form with the Plan Administrator
or its designate not later than November 30, 2005, and the
election once filed shall be irrevocable, and the Participant
may not rejoin the Plan for one or more subsequent Plan Years
unless he or she files the requisite deferral election forms in
accordance with Article V. The distribution to the Participant
shall be subject to the Corporation's collection of all
applicable withholding taxes, and the Participant shall only be
paid the net amount remaining after such withholding taxes have
been collected."

     3.  Except as modified by the foregoing amendments, the
terms and provisions of the Plan, as previously amended, shall
continue in full force and effect.

         IN WITNESS WHEREOF, SAN JOSE WATER COMPANY has caused
this Plan Amendment to be executed by its duly-authorized
officer on this 27th day of October 2005.

                              SAN JOSE WATER COMPANY

                              /s/ W. Richard Roth
                              ______________________________
                              W. Richard Roth, President and
                              Chief Executive Officer





                  SPECIAL TERMINATION ELECTION
                             FOR
                       2005 PLAN YEAR


          I hereby elect to terminate my participation in the
San Jose Water Company Special Deferral Election Plan for the
2005 Plan Year to the extent indicated below and instead receive
a lump distribution of the balance credited as of December 15,
2005 to the deferred compensation accounts under that Plan which
I have designated below.  I understand and agree that the lump
sum distribution will be made to me on or before December 31,
2005, that the distribution will be subject to San Jose Water
Company's withholding of all applicable withholding taxes and
that I may have to pay additional federal, state and local
income taxes with respect to this 2005 calendar year
distribution. I further understand that this election is
irrevocable and that I may not rejoin the Deferral Election Plan
for one or more subsequent Plan Years unless I file a timely
deferral election with respect to compensation to be earned in
those years.

                    2005 Lump Sum Distribution of

        ____  Account Attributable to 2005 Deferred Salary

        ____  Account Attributable to March 2005 Bonus Payment

                           SIGNATURE:     ______________________

                           PRINTED NAME:  ______________________

                           DATED:    ___________________, 2005*



*   The election must be filed with the Plan Administrator on or
before November 30, 2005 to be effective.