Bank Debt

12 Months Ended

Dec. 31, 2021

AWR has access to a $200.0 million credit facility expiring in May 2023 in order to provide funds to GSWC and ASUS in support of their operations on terms that are similar to that of the credit facility. At December 31, 2021, there was $174.5 million outstanding under the credit facility. The aggregate effective amount that may be outstanding under letters of credit is $25.0 million. AWR has obtained letters of credit for AWR and GSWC, in the aggregate amount of $455,000 at fees of 0.65%. Letters of credit outstanding reduce the amount that may be borrowed under the revolving credit facility. AWR is not required to maintain any compensating balances.

Loans may be obtained under this credit facility at the option of AWR and bear interest at rates based on credit ratings and LIBOR benchmark replacement rate margins. In March 2021, Standard and Poor’s Global Ratings (“S&P”) affirmed an A+ credit rating for both AWR and GSWC. S&P also revised its rating outlook to negative from stable for both companies. S&P’s debt ratings range from AAA (highest possible) to D (obligation is in default). In November 2021, Moody's Investors Service ("Moody's") affirmed its A2 rating with a stable outlook for GSWC.

BVESI has access to a $35.0 million revolving credit facility, which was amended in December 2021 to reduce the interest rate and fees, as well as extend the maturity date by a year to July 1, 2024. As of December 31, 2021, there was $31.0 million outstanding under this facility. Borrowings made under this facility support the electric segment's operations and capital expenditures. Under the terms of the credit agreement, BVESI has the option to increase in the facility by an additional $15 million, subject to lender approval. BVESI’s revolving credit facility is considered a short-term debt arrangement by the CPUC. BVESI has been authorized by the CPUC to borrow under this credit facility for a term of up to 24 months. Borrowings under this credit facility are, therefore, required to be fully paid off within a 24-month period. BVESI’s pay-off period for its credit facility ends in July 2022. Accordingly, the $31.0 million outstanding under BVESI's credit facility has been classified as a current liability in AWR's Consolidated Balance Sheet as of December 31, 2021.

Registrant’s borrowing activities (excluding letters of credit) for the years ended December 31, 2021 and 2020 were as follows:


	December 31,
(in thousands, except percent)	2021			2020
Balance Outstanding at December 31,	$	205,500		$	134,200
Interest Rate at December 31,	0.78% ~ 1.61%			1.19% ~ 1.90%
Average Amount Outstanding	$	165,167		$	162,995
Weighted Average Annual Interest Rate	1.05		%	1.47		%
Maximum Amount Outstanding	$	205,500		$	249,200

All of the letters of credit are issued pursuant to AWR's revolving credit facility. The revolving credit facility contains restrictions on prepayments, disposition of property, mergers, liens and negative pledges, indebtedness and guaranty obligations, transactions with affiliates, minimum interest coverage requirements, a maximum debt to capitalization ratio and a minimum debt rating. Pursuant to the credit agreement, AWR must maintain a minimum interest coverage ratio of 3.25 times interest expense, a maximum total funded debt ratio of 0.65 to 1.00 and a minimum Moody’s Investor Service or S&P debt rating of Baa3 or BBB-, respectively. As of December 31, 2021, 2020 and 2019, AWR was in compliance with these requirements. As of December 31, 2021, AWR had an interest coverage ratio of 8.21 times interest expense, a debt ratio of 0.47 to 1.00 and a debt rating of A+ by S&P.

Pursuant to BVESI's credit facility agreement, BVESI must maintain a minimum interest coverage ratio of 4.5 times interest expense and a maximum consolidated total debt to consolidated total capitalization ratio of 0.65 to 1.00. As of December 31, 2021 and 2020, BVESI was in compliance with these requirements, with an actual interest coverage ratio of 58.6 times interest expense and a total funded debt ratio of 0.30 to 1.00 as of December 31, 2021. In addition, BVESI is required to have a current safety certification issued by the CPUC, which it currently has.