Following recent investigations of the Saturn system in situ by Pioneer 11 and Voyager 1 and 2 and remotely by the International Ultraviolet Explorer, we have reconsidered the sputtering of water ice surfaces by magnetospheric ions as a possible source of hydrogen atoms and heavy atoms and heavy ions. We use results from laboratory measurements of water ice sputtering and dissoiciation rate as a function of ice temperature. We also use Voyager charged particle data from the low energy charged particle experiment to obtain more accurate assessments of energetic ion fluxes and loss rates. Ion phase space densities show that, if charged particle sputtering is an important physical process, it will occur predominantly in the vicinity of Saturn's E ring and the moons Dione and Tethys, not at the outer edge of the A ring as previously suggested prior to the availablilty of in situ data. Charged particle sputtering of ice surfaces between 4.5 and 8 RS, followed by the ionization of H2O and dissociation fragments may be an important local source of the heavy ion plasma reported in the magnetosphere by Pioneer 11. We review several existing theories for the ring atmosphere and conclude that difficulties remain with all of them.