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                       [ CT Water Service, Inc. Logo ] 



                                             August 15, 1996



Dividend Reinvestment Plan Participants:

     In our continuing objective to increase the value of your investment, we
are modifying Connecticut Water Service, Inc.'s (the Company's) Dividend
Reinvestment Program (DRIP). These changes, effective August 15, 1996, are as
follows:

- -    Investment of optional cash payments may be made on a monthly basis (page
     9).

- -    The range of monthly optional cash payments is $25 - $1,000 per month (page
     9).

- -    The Company will have the option of providing DRIP shares through open
     market purchases, negotiated transactions, or through the current option of
     issuing newly issued shares directly from the Company. The Company intends,
     at this time, to effect DRIP share purchases in the open market (page 8).

- -    Elimination of the 5% discount on reinvested dividends. (pages 3 & 7).

     The Company has also amended the Plan to clarify that an "Investment Date"
means the dividend payment date with respect to reinvestment of dividends and
with respect to optional cash payments is normally the second day of each
month.

     The changes are reflected in the revised DRIP Prospectus dated August 15,
1996, a copy of which is enclosed. In all other material respects, the Plan will
continue to operate as it currently operates.

     The financing requirements of the Company have changed dramatically since
the DRIP was offered. Our major expenditures required for compliance with the
Safe Drinking Water Act are behind us and a cost effective method of currently
financing the business requires less new equity dollars than we have needed in
our recent past. In addition, limiting the increase in new common shares
outstanding will have less of a dilution in earnings per share. This, along with
eliminating the 5% discount on new shares purchased, will have a positive effect
on the Company's flexibility to raise the dividend in the future which we
strongly feel is what our shareholders have come to expect with their investment
in the Company.

     The other changes that provide more frequent access to investing in the
Company reflect the desires many of our shareholders expressed in last year's
shareholder survey.

                                             Sincerely yours,


                                             /s/ Marshall T. Chiaraluce
                                             --------------------------
                                             Marshall T. Chiaraluce
                                             President/CEO