Regulatory Matters (Tables)

12 Months Ended

Dec. 31, 2024

Regulatory assets and liabilities are comprised of the following as of December 31:


	2024		2023
Regulatory assets:
Income tax temporary differences (a) (q)	$	180,103	157,669
Unrecognized pensions and other postretirement benefits (b) (q)	3,177		24,593
Business combinations debt premium (c) (q)	12,313		14,855
Employee benefit costs (d) (q)	6,370		9,815
MWRAM (e)	9,985		9,361
Customer Assistance Program (“CAP”) balancing account (f)	6,599		5,457
Catastrophic event memorandum accounts (“CEMA”) (g)	986		4,819
2022 general rate case interim memorandum account (h)	3,392		4,571
Revenue adjustment mechanisms (n) (q)	5,024		—
Water supply costs (i)	—		583
Other (j)	14,278		8,463
Total regulatory assets	242,227		240,186
Less: current regulatory asset (k)	18,172		4,276
Total regulatory assets, less current portion	$	224,055	235,910
Regulatory liabilities:
Cost of removal (l)	$	364,398	346,418
Future income tax benefits due to customers (m)	84,128		88,610
Unrecognized pensions and other postretirement benefits (b)	27,872		20,196
Employee benefit costs (d)	1,137		—
Revenue adjustment mechanisms (n)	1,122		5,536
Water supply costs (i)	3,386		—
Other (o)	2,798		3,407
Total regulatory liabilities	484,841		464,167
Less: current regulatory liabilities (p)	1,122		3,059
Total regulatory liabilities, less current portion	$	483,719	461,108

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(a)Consists primarily of temporary income tax differences that are flowed through to customers, which will be recovered in future rates as these temporary differences reverse. The company expects to recover regulatory assets related to plant depreciation income tax temporary differences over the lives of the plant assets, which are between 5 to 100 years.

(b)Represents actuarial losses and gains and prior service cost that have not yet been recognized as components of net periodic benefit cost for certain pension and other postretirement benefit plans.

(c)Consists of debt fair value adjustments recognized through purchase accounting for the completed merger with CTWS in 2019.

(d)Includes deferrals of pension and other postretirement benefit expense, cost of accrued benefits for vacation, and group health insurance.

(e)MWRAM is described in the previous section.

(f)Represents costs associated with SJWC’s CAP.

(g)The CPUC has authorized water utilities to activate CEMA accounts in order to track savings and costs related to SJWC’s response to catastrophic events, which includes external labor and materials, increases in bad debt from suspension of shutoffs for non-payment, waived deposits and reconnection fees, and divergence from actual versus authorized usage. The balances primarily relate to expenses associated with SJWC’s response to COVID-19, including bad debt.

(h)Represents the difference between revenues collected in interim rates in effect as of January 1, 2022 and revenues that would result from rates authorized in SJWC’s 2022 general rate case retroactive to January 1, 2022.

(i)Reflects primarily SJWC’s FCBA which tracks differences in actual water supply costs compared to amounts assumed in base rates, including applicable changes and variations in costs and quantities that affect the overall mix of the water supply.

(j)Other includes other balancing and memorandum accounts and regulatory mechanisms, deferred costs for certain information technology activities, asset retirement obligations, tank painting, well reconditioning and rate case expenses.

(k)As of December 31, 2024, primarily relates to SJWC’s balancing and memorandum account surcharge in accordance with Decision No. 24-12-077 and the current portion of CWC’s deferred well redevelopment and rate case costs. As of December 31, 2023, primarily relates to the current portion of MWRAM.

(l)Represents amounts collected in rates from customers for estimated costs to retire assets at the end of their expected useful lives before the costs are incurred.

(m)On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the "Tax Act”) was signed into law. The Tax Act included a reduction in the federal income tax rate from 35% to 21%. The rate reduction was effective on January 1, 2018 and resulted in a regulatory liability for the excess deferred income taxes. The benefit of amortization of excess deferred income taxes flows back to the customers under current normalization rules and agreed upon methods with the commissions.

(n)Consists of WRA and WCMA, which are described in the previous section.

(o)Other includes other balancing and memorandum accounts, other regulatory mechanisms and accrued tank painting costs.

(p)Primarily relates to the current portion of WRA.

(q)Generally not earning a return either by interest on the regulatory asset or as a component of rate base at the allowed rate of return.