Allowance for Doubtful Accounts

12 Months Ended

Dec. 31, 2024

Registrant’s allowance for doubtful accounts is developed based on expected credit losses and other considerations that may impact the customers’ ability to pay their bills. The estimate considers customer payment history and trends but also any COVID relief funds that Registrant received.

The CPUC had authorized GSWC and BVES to track incremental costs including bad debt expense in excess of what is included in their respective revenue requirements and costs incurred as a result of the pandemic in COVID-19 related memorandum accounts to be filed with the CPUC for future recovery. In March 2024, as a result of the Extended Arrearage Program approved by the governor of California, GSWC received $3.5 million in COVID-19 relief funds from the State of California to provide assistance to customers for delinquent water customer bills incurred during the pandemic. In January 2022, GSWC received $9.5 million in COVID relief funds from the state of California through the initial California Water and Wastewater Arrearage Payment Program, which were applied to delinquent customers’ eligible balances incurred during the COVID-19 pandemic. During 2022, BVES received a total of $0.5 million from the state of California for similar relief funding for unpaid electric bills incurred during the pandemic. Pursuant to CPUC requirements, as of December 31, 2024, 2023 and 2022, GSWC and BVES reflected these relief funds as a reduction to its COVID-19 memorandum accounts, as well as a reduction to its estimated allowance for doubtful accounts. On April 10, 2023, the Biden Administration terminated the COVID-19 national emergency. The COVID-19 emergency-related memorandum accounts for GSWC and BVES expired when the COVID-19 national emergency ended.

Other accounts receivable consist primarily of amounts due from third parties (non-utility customers) for various reasons, including amounts due from contractors, amounts due under settlement agreements, and amounts due from other third-party prime government contractors pursuant to agreements for construction of water and/or wastewater facilities for such third-party prime contractors.

The table below presents Registrant’s provision for doubtful accounts charged to expense and accounts written off, net of recoveries. Provisions included in 2024, 2023 and 2022 for AWR and GSWC are as follows:


	AWR
	December 31,
(dollars in thousands)	2024		2023		2022
Balance at beginning of year	$	3,590	$	4,440	$	3,569
Provision charged (1)	1,717		932		2,842
Accounts written off, net of recoveries (2)	(1,629)		(1,782)		(1,971)
Balance at end of year	$	3,678	$	3,590	$	4,440

Allowance for doubtful accounts related to accounts receivable-customer	$	3,568	$	3,537	$	4,387

Allowance for doubtful accounts related to other accounts receivable	110		53		53
Total allowance for doubtful accounts	$	3,678	$	3,590	$	4,440

(1) The 2022 balance includes amounts in excess of GSWC’s and BVES’s respective revenue requirements incurred during the COVID-19 pandemic. These incremental amounts were recorded as regulatory assets in the COVID-19 memorandum accounts.

(2) Reflects consideration of government relief funds received in 2024 and 2022 from the state of California for unpaid water and electric utility bills incurred during the pandemic. In 2024, a total of $3.5 million was received for unpaid water bills. Additionally, in 2022, $9.5 million and $0.5 million was received for unpaid water and electric utility bills, respectively.


	GSWC
	December 31,
(dollars in thousands)	2024		2023		2022
Balance at beginning of year	$	3,447	$	4,196	$	3,221
Provision charged (3)	1,366		754		2,501
Accounts written off, net of recoveries (4)	(1,335)		(1,503)		(1,526)
Balance at end of year	$	3,478	$	3,447	$	4,196

Allowance for doubtful accounts related to accounts receivable-customer	$	3,368	$	3,394	$	4,143
Allowance for doubtful accounts related to other accounts receivable	110		53		53
Total allowance for doubtful accounts	$	3,478	$	3,447	$	4,196

(3) The 2022 balance includes amounts in excess of GSWC’s revenue requirement incurred during the COVID-19 pandemic. This incremental amount was recorded as a regulatory asset in the COVID-19 memorandum account.

(4) Reflects consideration of government relief funds received in 2024 and 2022 from the state of California for unpaid water utility bills incurred during the pandemic. A total of $3.5 million was received in 2024 and $9.5 million was received in 2022 for unpaid water utility bills.