Allowance for Doubtful Accounts

12 Months Ended

Dec. 31, 2023

Registrant’s allowance for doubtful accounts as of December 31, 2023 was 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 receives.

GSWC received confirmation from SWRCB that it is currently processing GSWC's application and expects to disburse approximately $3.5 million of COVID relief funds through the Extended Arrearage Program that will provide further assistance to customers for water debt accrued during the COVID-19 pandemic (Note 1). The CPUC has authorized GSWC and BVES to track incremental costs, including bad debt expense in excess of what is included in their respective revenue requirements, incurred as a result of the pandemic in COVID-19 related memorandum accounts to be filed with the CPUC for future recovery. 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 $473,000 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, 2023, 2022 and 2021, GSWC and BVES have 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.

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 2023, 2022 and 2021 for AWR and GSWC are as follows:


	AWR
	December 31,
(dollars in thousands)	2023		2022		2021
Balance at beginning of year	$	4,440	$	3,569	$	5,316
Provision charged (1)	932		2,842		8,150
Accounts written off, net of recoveries (2)	(1,782)		(1,971)		(9,897)
Balance at end of year	$	3,590	$	4,440	$	3,569

Allowance for doubtful accounts related to accounts receivable-customer	$	3,537	$	4,387	$	3,516

Allowance for doubtful accounts related to other accounts receivable	53		53		53
Total allowance for doubtful accounts	$	3,590	$	4,440	$	3,569

(1) In 2022 and 2021, includes amounts in excess of GSWC’s and BVES’s respective revenue requirements incurred during the COVID-19 pandemic. These incremental amounts are recorded as regulatory assets in the COVID-19 memorandum accounts.

(2) Reflects consideration of government relief funds expected to be received in 2024 and received in 2022 from the state of California for unpaid water and electric utility bills incurred during the pandemic. A total of $3.5 million is expected to be received for unpaid water utility bills in 2024, and $9.5 million and $473,000 was received in 2022 for unpaid water and electric utility bills, respectively.


	GSWC
	December 31,
(dollars in thousands)	2023		2022		2021
Balance at beginning of year	$	4,196	$	3,221	$	4,960
Provision charged (3)	754		2,501		7,732
Accounts written off, net of recoveries (4)	(1,503)		(1,526)		(9,471)
Balance at end of year	$	3,447	$	4,196	$	3,221

Allowance for doubtful accounts related to accounts receivable-customer	$	3,394	$	4,143	$	3,168
Allowance for doubtful accounts related to other accounts receivable	53		53		53
Total allowance for doubtful accounts	$	3,447	$	4,196	$	3,221

(3) In 2022 and 2021, 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 expected to be received in 2024 and received in 2022 from the state of California for unpaid water utility bills incurred during the pandemic. A total of $3.5 million is expected to be received in 2024 and $9.5 million was received in 2022 for unpaid water utility bills.