0001056903false12-312021Q20000092116false12-312021Q2P3Y00010569032021-01-012021-06-300001056903awr:GoldenStateWaterCompanyMember2021-01-012021-06-30xbrli:shares00010569032021-07-300001056903awr:GoldenStateWaterCompanyMember2021-07-30iso4217:USD00010569032021-06-3000010569032020-12-31iso4217:USDxbrli:shares00010569032021-04-012021-06-3000010569032020-04-012020-06-3000010569032020-01-012020-06-300001056903us-gaap:CommonStockMember2020-12-310001056903us-gaap:RetainedEarningsUnappropriatedMember2020-12-310001056903us-gaap:RetainedEarningsUnappropriatedMember2021-01-012021-03-3100010569032021-01-012021-03-310001056903us-gaap:CommonStockMember2021-01-012021-03-310001056903us-gaap:CommonStockMember2021-03-310001056903us-gaap:RetainedEarningsUnappropriatedMember2021-03-3100010569032021-03-310001056903us-gaap:RetainedEarningsUnappropriatedMember2021-04-012021-06-300001056903us-gaap:CommonStockMember2021-04-012021-06-300001056903us-gaap:CommonStockMember2021-06-300001056903us-gaap:RetainedEarningsUnappropriatedMember2021-06-300001056903us-gaap:CommonStockMember2019-12-310001056903us-gaap:RetainedEarningsUnappropriatedMember2019-12-3100010569032019-12-310001056903us-gaap:RetainedEarningsUnappropriatedMember2020-01-012020-03-3100010569032020-01-012020-03-310001056903us-gaap:CommonStockMember2020-01-012020-03-310001056903us-gaap:CommonStockMember2020-03-310001056903us-gaap:RetainedEarningsUnappropriatedMember2020-03-3100010569032020-03-310001056903us-gaap:RetainedEarningsUnappropriatedMember2020-04-012020-06-300001056903us-gaap:CommonStockMember2020-04-012020-06-300001056903us-gaap:CommonStockMember2020-06-300001056903us-gaap:RetainedEarningsUnappropriatedMember2020-06-3000010569032020-06-300001056903awr:GoldenStateWaterCompanyMember2021-06-300001056903awr:GoldenStateWaterCompanyMember2020-12-310001056903awr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2020-12-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2021-01-012021-03-310001056903awr:GoldenStateWaterCompanyMember2021-01-012021-03-310001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2021-01-012021-03-310001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2021-03-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2021-03-310001056903awr:GoldenStateWaterCompanyMember2021-03-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2021-04-012021-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2021-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2019-12-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2019-12-310001056903awr:GoldenStateWaterCompanyMember2019-12-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2020-01-012020-03-310001056903awr:GoldenStateWaterCompanyMember2020-01-012020-03-310001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2020-01-012020-03-310001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2020-03-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2020-03-310001056903awr:GoldenStateWaterCompanyMember2020-03-310001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2020-04-012020-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903us-gaap:CommonStockMemberawr:GoldenStateWaterCompanyMember2020-06-300001056903awr:GoldenStateWaterCompanyMemberus-gaap:RetainedEarningsUnappropriatedMember2020-06-300001056903awr:GoldenStateWaterCompanyMember2020-06-30awr:customerxbrli:pure0001056903awr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-30awr:registrant0001056903awr:BearValleyElectricServiceIncMember2021-04-012021-06-300001056903awr:BearValleyElectricServiceIncMember2020-04-012020-06-300001056903awr:BearValleyElectricServiceIncMember2021-01-012021-06-300001056903awr:BearValleyElectricServiceIncMember2020-01-012020-06-300001056903awr:AmericanStatesUtilityServicesMember2021-04-012021-06-300001056903awr:AmericanStatesUtilityServicesMember2020-04-012020-06-300001056903awr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903awr:AmericanStatesUtilityServicesMember2020-01-012020-06-300001056903srt:MaximumMembersrt:ParentCompanyMemberus-gaap:RevolvingCreditFacilityMember2021-06-300001056903srt:ParentCompanyMemberawr:SyndicatedRevolvingCreditFacilityMemberMember2021-06-300001056903awr:BearValleyElectricServiceIncMember2020-07-010001056903awr:BearValleyElectricServiceIncMember2021-06-300001056903awr:GoldenStateWaterCompanyMember2021-05-240001056903awr:GoldenStateWaterCompanyMember2021-05-242021-05-2400010569032020-10-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMember2021-06-300001056903us-gaap:SalesMemberawr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMemberus-gaap:CustomerConcentrationRiskMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903us-gaap:SalesMemberawr:WaterServiceUtilityOperationsMemberus-gaap:CustomerConcentrationRiskMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:TariffbasedRevenuesMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:TariffbasedRevenuesMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:TariffbasedRevenuesMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:TariffbasedRevenuesMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:OtherProductsandServicesMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:OtherProductsandServicesMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:OtherProductsandServicesMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:OtherProductsandServicesMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:AlternativerevenuesprogramMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:AlternativerevenuesprogramMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:AlternativerevenuesprogramMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterServiceUtilityOperationsMemberawr:AlternativerevenuesprogramMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:TariffbasedRevenuesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-04-012021-06-300001056903awr:TariffbasedRevenuesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMemberawr:TariffbasedRevenuesMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:TariffbasedRevenuesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:TariffbasedRevenuesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-04-012021-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:SurchargesCostrecoveryActivitiesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-04-012021-06-300001056903awr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:AlternativerevenuesprogramMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-04-012021-06-300001056903awr:AlternativerevenuesprogramMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903awr:AlternativerevenuesprogramMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMemberawr:AlternativerevenuesprogramMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903awr:AlternativerevenuesprogramMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903awr:ContractedServicesMemberus-gaap:PublicUtilitiesInventoryWaterMemberawr:AmericanStatesUtilityServicesMember2021-04-012021-06-300001056903awr:ContractedServicesMemberus-gaap:PublicUtilitiesInventoryWaterMemberawr:AmericanStatesUtilityServicesMember2020-04-012020-06-300001056903awr:ContractedServicesMemberus-gaap:PublicUtilitiesInventoryWaterMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903awr:ContractedServicesMemberus-gaap:PublicUtilitiesInventoryWaterMemberawr:AmericanStatesUtilityServicesMember2020-01-012020-06-300001056903awr:WastewaterMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-04-012021-06-300001056903awr:WastewaterMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-04-012020-06-300001056903awr:WastewaterMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903awr:WastewaterMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-01-012020-06-300001056903awr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-04-012021-06-300001056903awr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-04-012020-06-300001056903awr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-01-012020-06-300001056903awr:AmericanStatesUtilityServicesMember2021-06-300001056903awr:AmericanStatesUtilityServicesMember2020-12-310001056903srt:MinimumMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903srt:MaximumMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903us-gaap:DeferredIncomeTaxChargesMember2021-06-300001056903awr:FlowThroughTaxesNetMember2021-06-300001056903awr:PensionCostsAndOtherPostretirementBenefitCostsMember2021-06-300001056903us-gaap:GainLossOnDerivativeInstrumentsMember2021-06-300001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:CostsDeferredForFutureRecoveryOnAerojetCaseMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:CostsDeferredForFutureRecoveryOnAerojetCaseMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:PensionCostsAndOtherPostretirementBenefitCostsMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:PensionCostsAndOtherPostretirementBenefitCostsMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:CatastrophicEventMemoAccountCEMAMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:CatastrophicEventMemoAccountCEMAMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903us-gaap:DeferredIncomeTaxChargesMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903us-gaap:DeferredIncomeTaxChargesMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:FlowThroughTaxesNetMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:FlowThroughTaxesNetMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:GoldenStateWaterCompanyMemberawr:OtherRegulatoryAssetsNetMember2021-06-300001056903awr:GoldenStateWaterCompanyMemberawr:OtherRegulatoryAssetsNetMember2020-12-310001056903us-gaap:RevenueSubjectToRefundMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903us-gaap:RevenueSubjectToRefundMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903awr:BearValleyElectricServiceIncMemberus-gaap:GainLossOnDerivativeInstrumentsMember2021-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:GainLossOnDerivativeInstrumentsMember2020-12-310001056903awr:BearValleyElectricServiceIncMemberawr:OtherRegulatoryAssetsNetMember2021-06-300001056903awr:BearValleyElectricServiceIncMemberawr:OtherRegulatoryAssetsNetMember2020-12-310001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMembersrt:MaximumMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMemberawr:GoldenStateWaterCompanyMembersrt:MinimumMember2021-01-012021-06-300001056903awr:WaterRevenueAdjustmentMechanismNetOfModifiedCostBalancingAccountMember2021-01-012021-06-300001056903awr:WaterRevenueAdjustmentMechanismMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903awr:ModifiedCostBalancingAccountMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903srt:ParentCompanyMember2021-04-012021-06-300001056903srt:ParentCompanyMember2020-04-012020-06-300001056903srt:ParentCompanyMember2021-01-012021-06-300001056903srt:ParentCompanyMember2020-01-012020-06-300001056903us-gaap:CommodityContractMemberawr:GoldenStateWaterCompanyMembersrt:MinimumMember2021-01-012021-06-300001056903srt:MaximumMemberus-gaap:CommodityContractMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903us-gaap:CommodityContractMember2021-06-30utr:MWh0001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2021-03-310001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2020-03-310001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2020-12-310001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2019-12-310001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2021-04-012021-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2020-04-012020-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2021-01-012021-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2020-01-012020-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2021-06-300001056903awr:BearValleyElectricServiceIncMemberus-gaap:CommodityContractMember2020-06-300001056903awr:MutualFundsMemberus-gaap:FairValueInputsLevel1Member2021-06-300001056903us-gaap:CarryingReportedAmountFairValueDisclosureMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903us-gaap:EstimateOfFairValueFairValueDisclosureMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903us-gaap:CarryingReportedAmountFairValueDisclosureMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903us-gaap:EstimateOfFairValueFairValueDisclosureMemberawr:GoldenStateWaterCompanyMember2020-12-310001056903us-gaap:ParentMember2021-04-012021-06-300001056903us-gaap:ParentMember2020-04-012020-06-300001056903us-gaap:ParentMember2021-01-012021-06-300001056903us-gaap:ParentMember2020-01-012020-06-300001056903us-gaap:PensionPlansDefinedBenefitMember2021-04-012021-06-300001056903us-gaap:PensionPlansDefinedBenefitMember2020-04-012020-06-300001056903us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-04-012021-06-300001056903us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2020-04-012020-06-300001056903us-gaap:SupplementalEmployeeRetirementPlanDefinedBenefitMember2021-04-012021-06-300001056903us-gaap:SupplementalEmployeeRetirementPlanDefinedBenefitMember2020-04-012020-06-300001056903us-gaap:PensionPlansDefinedBenefitMember2021-01-012021-06-300001056903us-gaap:PensionPlansDefinedBenefitMember2020-01-012020-06-300001056903us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-01-012021-06-300001056903us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2020-01-012020-06-300001056903us-gaap:SupplementalEmployeeRetirementPlanDefinedBenefitMember2021-01-012021-06-300001056903us-gaap:SupplementalEmployeeRetirementPlanDefinedBenefitMember2020-01-012020-06-300001056903us-gaap:PensionPlansDefinedBenefitMember2021-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:WaterServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903us-gaap:PensionPlansDefinedBenefitMemberawr:BearValleyElectricServiceIncMember2021-06-300001056903us-gaap:EnvironmentalIssueMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903us-gaap:EnvironmentalIssueMemberawr:GoldenStateWaterCompanyMember2021-06-30awr:segment0001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2021-04-012021-06-300001056903srt:ReportableLegalEntitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-04-012021-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-04-012021-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2021-04-012021-06-300001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2021-06-300001056903srt:ReportableLegalEntitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2021-06-300001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903srt:ReportableLegalEntitiesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-04-012020-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-04-012020-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2020-04-012020-06-300001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2020-06-300001056903srt:ReportableLegalEntitiesMemberawr:ElectricServiceUtilityOperationsMemberawr:GoldenStateWaterCompanyMember2020-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2020-06-300001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2021-01-012021-06-300001056903srt:ReportableLegalEntitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-01-012021-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2021-01-012021-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2021-01-012021-06-300001056903awr:WaterServiceUtilityOperationsMembersrt:ReportableLegalEntitiesMemberawr:GoldenStateWaterCompanyMember2020-01-012020-06-300001056903srt:ReportableLegalEntitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2020-01-012020-06-300001056903srt:ReportableLegalEntitiesMemberawr:ContractedServicesMemberawr:AmericanStatesUtilityServicesMember2020-01-012020-06-300001056903us-gaap:IntersegmentEliminationMembersrt:ParentCompanyMember2020-01-012020-06-300001056903srt:ReportableLegalEntitiesMemberawr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2020-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMember2021-04-012021-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMember2021-01-012021-06-300001056903awr:GoldenStateWaterCompanyAndBearValleyElectricServiceIncMember2020-01-012020-06-300001056903awr:BearValleyElectricServiceIncMember2020-07-012020-07-0100010569032020-07-012020-07-010001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2020-01-012020-06-300001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2020-04-012020-06-300001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2020-12-310001056903awr:BearValleyElectricServiceIncMemberawr:ElectricServiceUtilityOperationsMember2021-06-300001056903awr:BearValleyElectricServiceIncMember2020-07-012020-07-01


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
(Mark One)
 
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for the quarterly period ended June 30, 2021

or
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for the transition period from                    to                   
 
Commission file number   001-14431 
American States Water Company
(Exact Name of Registrant as Specified in Its Charter)
 
California   95-4676679
(State or Other Jurisdiction of Incorporation or Organization)   (IRS Employer Identification No.)
630 E. Foothill Blvd San Dimas CA 91773-1212
(Address of Principal Executive Offices) (Zip Code)
(909) 394-3600
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
Commission file number   001-12008 

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
Title of each class Trading symbol Name of each exchange on which registered
Common shares AWR New York Stock Exchange
Golden State Water Company
(Exact Name of Registrant as Specified in Its Charter)
California   95-1243678
(State or Other Jurisdiction of Incorporation or Organization)   (IRS Employer Identification No.)
630 E. Foothill Blvd San Dimas CA 91773-1212
(Address of Principal Executive Offices) (Zip Code)
(909) 394-3600
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
 
Indicate by check mark whether Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.



American States Water Company Yes
x
No ¨
Golden State Water Company Yes
x
No ¨
 
Indicate by check mark whether Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or such shorter period that the Registrant was required to submit and post such files).
American States Water Company Yes
x
No ¨
Golden State Water Company Yes
x
No ¨

 Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
American States Water Company
Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company Emerging growth company
Golden State Water Company
Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer x Smaller reporting company Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨
 Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)
American States Water Company   Yes No x
Golden State Water Company   Yes No x
As of July 30, 2021, the number of Common Shares outstanding of American States Water Company was 36,931,771 shares. As of July 30, 2021, all of the 170 outstanding Common Shares of Golden State Water Company were owned by American States Water Company.
Golden State Water Company meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form, in part, with the reduced disclosure format for Golden State Water Company.



AMERICAN STATES WATER COMPANY
and
GOLDEN STATE WATER COMPANY
FORM 10-Q
 
INDEX

 
3
1
 
2
 
4
5
Consolidated Statements of Changes in Common Shareholders' Equity - For the Three and Six Months Ended June 30, 2020
6
 
7
 
8
 
 
 
 
 


PART I
Item 1. Financial Statements
General
 The basic financial statements included herein have been prepared by Registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.
 Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments consisting of normal recurring items and estimates necessary for a fair statement of results for the interim period have been made.
 It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto in the latest Annual Report on Form 10-K of American States Water Company and its wholly owned subsidiary, Golden State Water Company. 
Filing Format
American States Water Company (“AWR”) is the parent company of Golden State Water Company (“GSWC”), Bear Valley Electric Service, Inc. ("BVESI"), and American States Utility Services, Inc. and its subsidiaries ("ASUS"). On July 1, 2020, GSWC completed the transfer of the electric utility assets and liabilities from its electric division to BVESI, in exchange for common shares of BVESI. GSWC then immediately distributed all of BVESI's common shares to AWR, whereupon BVESI became wholly owned directly by AWR. This reorganization did not result in any substantive changes to AWR's operations and business segments.
This quarterly report on Form 10-Q is a combined report being filed by two separate Registrants: AWR and GSWC. For more information, please see Note 1 of the Notes to Consolidated Financial Statements and the heading entitled "General" in "Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations." References in this report to “Registrant” are to AWR and GSWC collectively, unless otherwise specified. GSWC makes no representations as to the information contained in this report other than with respect to itself.
Forward-Looking Information
     This Form 10-Q and the documents incorporated herein contain forward-looking statements intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are based on current estimates, expectations and projections about future events and assumptions regarding these events and include statements regarding management’s goals, beliefs, plans or current expectations, taking into account the information currently available to management.  Forward-looking statements are not statements of historical facts.  For example, when we use words such as “anticipate,” “believe,” “plan,” “estimate,” “expect,” “intend,” “may” and other words that convey uncertainty of future events or outcomes, we are making forward-looking statements.  We are not able to predict all the factors that may affect future results.  We caution you that any forward-looking statements made by us are not guarantees of future performance and the actual results may differ materially from those in our forward-looking statements. 
Factors affecting our financial performance are summarized under Forward-Looking Information and under “Risk Factors” in our Form 10-K for the period ended December 31, 2020 filed with the SEC. Please consider our forward-looking statements in light of these risks as you read this Form 10-Q.  We qualify all of our forward-looking statements by these cautionary statements.

1

AMERICAN STATES WATER COMPANY
CONSOLIDATED BALANCE SHEETS
ASSETS
(Unaudited)

(in thousands) June 30,
2021
December 31, 2020
Property, Plant and Equipment    
Regulated utility plant, at cost $ 2,112,249  $ 2,043,791 
Non-utility property, at cost 37,662  36,578 
Total 2,149,911  2,080,369 
Less - Accumulated depreciation (579,278) (568,326)
Net property, plant and equipment 1,570,633  1,512,043 
Other Property and Investments    
Goodwill 1,116  1,116 
Other property and investments 37,414  35,318 
Total other property and investments 38,530  36,434 
Current Assets    
Cash and cash equivalents 5,359  36,737 
Accounts receivable — customers (less allowance for doubtful accounts of $7,445 in 2021 and $5,263 in 2020)
28,516  29,162 
Unbilled receivable 29,569  25,836 
Receivable from the U.S. government (Note 2) 25,698  25,182 
Other accounts receivable (less allowance for doubtful accounts of $53 in 2021 and $53 in 2020)
4,961  3,960 
Income taxes receivable 1,147  103 
Materials and supplies, at weighted average cost 8,773  8,619 
Regulatory assets — current 14,394  13,088 
Prepayments and other current assets 8,365  5,555 
Unrealized gains on purchased power contracts 2,810  — 
Contract assets 6,720  8,873 
Total current assets 136,312  157,115 
Other Assets    
Unbilled revenue — receivable from U.S. government 8,340  9,945 
Receivable from the U.S. government (Note 2) 52,957  49,488 
Contract assets (Note 2) 4,452  1,384 
Operating lease right-of-use assets 10,633  11,146 
Regulatory assets 9,799  3,451 
Other 10,702  10,597 
Total other assets 96,883  86,011 
Total Assets $ 1,842,358  $ 1,791,603 
 
The accompanying notes are an integral part of these consolidated financial statements



2

AMERICAN STATES WATER COMPANY
CONSOLIDATED BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
(Unaudited)
(in thousands, except number of shares) June 30,
2021
December 31,
2020
Capitalization    
Common shares, no par value
Authorized: 60,000,000 shares
Outstanding: 36,931,771 shares in 2021 and 36,889,103 shares in 2020
$ 258,101  $ 256,666 
Earnings reinvested in the business 406,033  385,007 
Total common shareholders’ equity 664,134  641,673 
Long-term debt 412,345  440,348 
Total capitalization 1,076,479  1,082,021 
Current Liabilities    
Long-term debt — current 376  358 
Accounts payable 65,951  63,788 
Income taxes payable 390  6,783 
Accrued other taxes 9,977  11,902 
Accrued employee expenses 16,495  15,122 
Accrued interest 4,496  4,832 
Unrealized losses on purchased power contracts —  1,537 
Contract liabilities (Note 2) 688  1,800 
Operating lease liabilities 2,049  2,013 
Other 10,929  10,437 
Total current liabilities 111,351  118,572 
Other Credits    
Notes payable to bank 188,000  134,200 
Advances for construction 64,180  63,374 
Contributions in aid of construction - net 144,979  140,332 
Deferred income taxes 134,644  131,172 
Unamortized investment tax credits 1,188  1,224 
Accrued pension and other postretirement benefits 96,766  95,639 
Operating lease liabilities 9,028  9,636 
Other 15,743  15,433 
Total other credits 654,528  591,010 
Commitments and Contingencies (Note 9)
Total Capitalization and Liabilities $ 1,842,358  $ 1,791,603 
 
The accompanying notes are an integral part of these consolidated financial statements
3

AMERICAN STATES WATER COMPANY
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED
JUNE 30, 2021 AND 2020
(Unaudited)

  Three Months Ended June 30, Six Months Ended June 30,
(in thousands, except per share amounts) 2021 2020 2021 2020
Operating Revenues    
Water $ 91,633  $ 87,074  $ 166,662  $ 158,498 
Electric 8,108  7,679  19,647  18,647 
Contracted services 28,673  26,525  59,165  53,210 
Total operating revenues 128,414  121,278  245,474  230,355 
Operating Expenses    
Water purchased 20,916  18,754  36,155  32,846 
Power purchased for pumping 2,861  2,398  5,006  4,257 
Groundwater production assessment 5,220  5,030  9,660  9,178 
Power purchased for resale 2,130  1,967  5,328  5,010 
Supply cost balancing accounts (3,086) (1,802) (5,513) (3,967)
Other operation 8,534  7,959  16,751  16,445 
Administrative and general 20,630  20,398  42,683  43,348 
Depreciation and amortization 9,770  9,031  19,330  17,842 
Maintenance 3,267  4,094  5,929  7,978 
Property and other taxes 5,273  5,246  11,213  10,405 
ASUS construction 15,052  12,487  30,756  25,598 
Total operating expenses 90,567  85,562  177,298  168,940 
Operating Income 37,847  35,716  68,176  61,415 
Other Income and Expenses    
Interest expense (6,032) (5,322) (12,290) (11,372)
Interest income 348  490  803  1,048 
Other, net 1,875  3,009  2,531  775 
Total other income and expenses, net (3,809) (1,823) (8,956) (9,549)
Income before income tax expense 34,038  33,893  59,220  51,866 
Income tax expense 7,462  8,281  13,376  12,182 
Net Income $ 26,576  $ 25,612  45,844  39,684 
Weighted Average Number of Common Shares Outstanding 36,916  36,884  36,907  36,872 
Basic Earnings Per Common Share $ 0.72  $ 0.69  $ 1.24  $ 1.07 
Weighted Average Number of Diluted Shares 37,007  37,000  36,993  36,985 
Fully Diluted Earnings Per Common Share $ 0.72  $ 0.69  $ 1.24  $ 1.07 
Dividends Paid Per Common Share $ 0.335  $ 0.305  $ 0.670  $ 0.610 
 
The accompanying notes are an integral part of these consolidated financial statements

4

AMERICAN STATES WATER COMPANY
CONSOLIDATED STATEMENTS OF CHANGES
IN COMMON SHAREHOLDERS' EQUITY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021
(Unaudited)



Three and Six Months Ended June 30, 2021
  Common Shares Reinvested  
  Number   Earnings  
  of   in the  
(in thousands) Shares Amount Business Total
Balances at December 31, 2020 36,889  $ 256,666  $ 385,007  $ 641,673 
Add:        
Net income 19,268  19,268 
Exercise of stock options and other issuances of Common Shares 24 —  — 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 813  813 
Dividend equivalent rights on stock-based awards not paid in cash 49  49 
Deduct:  
Dividends on Common Shares 12,361  12,361 
Dividend equivalent rights on stock-based awards not paid in cash 49  49 
Balances at March 31, 2021 36,913 $ 257,528  $ 391,865  $ 649,393 
Add:
Net income 26,576  26,576 
Exercise of stock options and other issuances of Common Shares 19 —  — 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 531  531 
Dividend equivalent rights on stock-based awards not paid in cash 42  42 
Deduct:
Dividends on Common Shares 12,366  12,366 
Dividend equivalent rights on stock-based awards not paid in cash 42  42 
Balances at June 30, 2021 36,932 $ 258,101  $ 406,033  $ 664,134 

The accompanying notes are an integral part of these consolidated financial statements.
5

AMERICAN STATES WATER COMPANY
CONSOLIDATED STATEMENTS OF CHANGES
IN COMMON SHAREHOLDERS' EQUITY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020
(Unaudited)
Three and Six Months Ended June 30, 2020
  Common Shares Reinvested  
  Number   Earnings  
  of   in the  
(in thousands) Shares Amount Business Total
Balances at December 31, 2019 36,847 $ 255,566  $ 345,964  $ 601,530 
Add:        
Net income 14,072  14,072 
Exercise of stock options and other issuances of Common Shares 37 30  30 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 193  193 
Dividend equivalent rights on stock-based awards not paid in cash 52  52 
Deduct:  
Dividends on Common Shares 11,242  11,242 
Dividend equivalent rights on stock-based awards not paid in cash 52  52 
Balances at March 31, 2020 36,884  $ 255,841  $ 348,742  $ 604,583 
Add:
Net income 25,612  25,612 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 343  343 
Dividend equivalent rights on stock-based awards not paid in cash 39  39 
Deduct:
Dividends on Common Shares 11,250  11,250 
Dividend equivalent rights on stock-based awards not paid in cash 39  39 
Balances at June 30, 2020 36,884  $ 256,223  $ 363,065  $ 619,288 

The accompanying notes are an integral part of these consolidated financial statements.

6

AMERICAN STATES WATER COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Unaudited)
  Six Months Ended 
 June 30,
(in thousands) 2021 2020
Cash Flows From Operating Activities:    
Net income $ 45,844  $ 39,684 
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 19,520  18,008 
Provision for doubtful accounts 548  569 
Deferred income taxes and investment tax credits 353  1,234 
Stock-based compensation expense 2,379  2,127 
Gain on investments held in a trust (2,208) (61)
Other — net 215  157 
Changes in assets and liabilities:    
Accounts receivable — customers (2,087) (10,514)
Unbilled receivable (2,128) (532)
Other accounts receivable (1,001) 139 
Receivables from the U.S. government (3,584) (2,587)
Materials and supplies (154) (1,739)
Prepayments and other assets (1,997) (1,400)
Contract assets (1,316) (1,820)
Regulatory assets (8,802) (6,995)
Accounts payable 2,266  (27)
Income taxes receivable/payable (7,437) 10,836 
Contract liabilities (1,112) (600)
Accrued pension and other postretirement benefits 3,595  2,693 
Other liabilities (1,750) (2,909)
Net cash provided 41,144  46,263 
Cash Flows From Investing Activities:    
Capital expenditures (76,147) (62,587)
Other investing activities 64  104 
Net cash used (76,083) (62,483)
Cash Flows From Financing Activities:    
Proceeds from stock option exercises —  30 
Receipt of advances for and contributions in aid of construction 6,837  4,630 
Refunds on advances for construction (2,922) (2,767)
Retirement or repayments of long-term debt (28,156) (210)
Net change in notes payable to banks 53,800  44,000 
Dividends paid (24,727) (22,492)
Other financing activities (1,271) (1,809)
Net cash provided 3,561  21,382 
Net change in cash and cash equivalents (31,378) 5,162 
Cash and cash equivalents, beginning of period 36,737  1,334 
Cash and cash equivalents, end of period $ 5,359  $ 6,496 
Non-cash transactions:
Accrued payables for investment in utility plant $ 27,758  $ 19,892 
Property installed by developers and conveyed $ 3,401  $ 1,535 

The accompanying notes are an integral part of these consolidated financial statements
7

GOLDEN STATE WATER COMPANY
BALANCE SHEETS
ASSETS
(Unaudited)
(in thousands) June 30,
2021
December 31,
2020
Utility Plant    
Utility plant, at cost $ 1,960,802  $ 1,902,772 
Less - Accumulated depreciation (510,283) (502,283)
Net utility plant 1,450,519  1,400,489 
Other Property and Investments 35,342  33,240 
Current Assets    
Cash and cash equivalents 4,659  35,578 
Accounts receivable — customers (less allowance for doubtful accounts of $6,910 in 2021 and $4,907 in 2020)
26,715  26,920 
Unbilled receivable 20,502  19,330 
Other accounts receivable (less allowance for doubtful accounts of $53 in 2021 and $53 in 2020)
2,521  3,255 
Intercompany receivable —  1,107 
Materials and supplies, at average cost 3,833  3,659 
Regulatory assets — current 14,394  11,325 
Prepayments and other current assets 5,674  4,114 
Total current assets 78,298  105,288 
Other Assets    
Operating lease right-of-use assets 10,511  11,103 
Regulatory assets 8,857  1,048 
Other 9,586  9,614 
Total other assets 28,954  21,765 
Total Assets $ 1,593,113  $ 1,560,782 

The accompanying notes are an integral part of these financial statements
8

GOLDEN STATE WATER COMPANY
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
(Unaudited)
(in thousands, except number of shares) June 30,
2021
December 31, 2020
Capitalization    
Common Shares, no par value:
 Authorized: 1,000 shares
 Outstanding: 170 shares in 2021 and 2020
$ 356,251  $ 354,906 
Earnings reinvested in the business 236,699  228,392 
Total common shareholder’s equity 592,950  583,298 
Long-term debt 412,345  440,348 
Total capitalization 1,005,295  1,023,646 
Current Liabilities    
Long-term debt — current 376  358 
Accounts payable 50,210  45,613 
Accrued other taxes 8,675  10,382 
Accrued employee expenses 13,288  12,351 
Accrued interest 4,218  4,545 
Income taxes payable to Parent 532  4,612 
Operating lease liabilities 2,018  1,956 
Other 9,476  9,403 
Total current liabilities 88,793  89,220 
Other Credits    
Intercompany payable to Parent 41,835  — 
Advances for construction 64,160  63,354 
Contributions in aid of construction — net 143,336  138,691 
Deferred income taxes 127,861  124,581 
Unamortized investment tax credits 1,188  1,224 
Accrued pension and other postretirement benefits 96,625  95,570 
Operating lease liabilities 8,977  9,636 
Other 15,043  14,860 
Total other credits 499,025  447,916 
Commitments and Contingencies (Note 9)
Total Capitalization and Liabilities $ 1,593,113  $ 1,560,782 
 
The accompanying notes are an integral part of these financial statements
9

GOLDEN STATE WATER COMPANY
STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED
JUNE 30, 2021 AND 2020
(Unaudited)

  Three Months Ended June 30, Six Months Ended June 30,
(in thousands) 2021 2020 2021 2020
Operating Revenues    
Water $ 91,633  $ 87,074  $ 166,662  $ 158,498 
Electric (Note 11) —  7,679  —  18,647 
Total operating revenues 91,633  94,753  166,662  177,145 
Operating Expenses (Note 11)    
Water purchased 20,916  18,754  36,155  32,846 
Power purchased for pumping 2,861  2,398  5,006  4,257 
Groundwater production assessment 5,220  5,030  9,660  9,178 
Power purchased for resale —  1,967  —  5,010 
Supply cost balancing accounts (3,411) (1,802) (6,331) (3,967)
Other operation 6,376  6,370  12,189  13,000 
Administrative and general 13,861  15,733  28,296  32,571 
Depreciation and amortization 8,213  8,209  16,275  16,238 
Maintenance 2,356  3,201  4,096  6,394 
Property and other taxes 4,464  4,718  9,480  9,351 
Total operating expenses 60,856  64,578  114,826  124,878 
Operating Income (Note 11) 30,777  30,175  51,836  52,267 
Other Income and Expenses    
Interest expense (5,643) (5,177) (11,441) (10,954)
Interest income 179  181  266  499 
Other, net 1,604  3,049  2,255  846 
Total other income and expenses, net (3,860) (1,947) (8,920) (9,609)
Income before income tax expense 26,917  28,228  42,916  42,658 
Income tax expense 5,957  7,309  9,725  10,537 
Net Income (Note 11) $ 20,960  $ 20,919  $ 33,191  $ 32,121 
 
The accompanying notes are an integral part of these consolidated financial statements
10

GOLDEN STATE WATER COMPANY
STATEMENTS OF CHANGES
IN COMMON SHAREHOLDER'S EQUITY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021
(Unaudited)
Three and Six Months Ended June 30, 2021
  Common Shares Reinvested  
  Number   Earnings  
  of   in the  
(in thousands, except number of shares) Shares Amount Business Total
Balances at December 31, 2020 170 $ 354,906  $ 228,392  $ 583,298 
Add:        
Net income 12,231  12,231 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 782  782 
Dividend equivalent rights on stock-based awards not paid in cash 45  45 
Deduct:  
Dividends on Common Shares 12,400  12,400 
Dividend equivalent rights on stock-based awards not paid in cash 45  45 
Balances at March 31, 2021 170  $ 355,733  $ 228,178  $ 583,911 
Add:
Net income 20,960  20,960 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 479  479 
Dividend equivalent rights on stock-based awards not paid in cash 39  39 
Deduct:
Dividends on Common Shares 12,400  12,400 
Dividend equivalent rights on stock-based awards not paid in cash 39  39 
Balances at June 30, 2021 170  $ 356,251  $ 236,699  $ 592,950 


The accompanying notes are an integral part of these financial statements
11

GOLDEN STATE WATER COMPANY
STATEMENTS OF CHANGES
IN COMMON SHAREHOLDER'S EQUITY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020
(Unaudited)

Three and Six Months Ended June 30, 2020
  Common Shares Reinvested  
  Number   Earnings  
  of   in the  
(in thousands, except number of shares) Shares Amount Business Total
Balances at December 31, 2019 165 $ 293,754  $ 257,434  $ 551,188 
Add:        
Net income 11,202  11,202 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 254  254 
Dividend equivalent rights on stock-based awards not paid in cash 46  46 
Deduct:  
Dividends on Common Shares 11,250  11,250 
Dividend equivalent rights on stock-based awards not paid in cash 46  46 
Balances at March 31, 2020 165  $ 294,054  $ 257,340  $ 551,394 
Add:
Net income 20,919  20,919 
Stock-based compensation, net of taxes paid from shares withheld from employees related to net share settlements (Note 4) 296  296 
Dividend equivalent rights on stock-based awards not paid in cash 36  36 
Deduct:
Dividends on Common Shares 11,250  11,250 
Dividend equivalent rights on stock-based awards not paid in cash 36  36 
Balances at June 30, 2020 165  $ 294,386  $ 266,973  $ 561,359 

The accompanying notes are an integral part of these financial statements
12

GOLDEN STATE WATER COMPANY
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Unaudited)
 
  Six Months Ended 
 June 30,
(in thousands) 2021 2020
Cash Flows From Operating Activities:    
Net income $ 33,191  $ 32,121 
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 16,404  16,403 
Provision for doubtful accounts 490  569 
Deferred income taxes and investment tax credits 328  1,603 
Stock-based compensation expense 2,190  1,942 
Gain on investments held in a trust (2,208) (61)
Other — net 170  141 
Changes in assets and liabilities:    
Accounts receivable — customers (2,282) (10,514)
Unbilled receivable (1,172) (600)
Other accounts receivable 734  (109)
Materials and supplies (174) (2,134)
Prepayments and other assets (485) (894)
Regulatory assets (8,489) (6,995)
Accounts payable 3,999  2,432 
Intercompany receivable/payable (15) (1,610)
Income taxes receivable/payable from/to Parent (4,080) 8,934 
Accrued pension and other postretirement benefits 3,523  2,693 
Other liabilities (2,075) (2,888)
Net cash provided 40,049  41,033 
Cash Flows From Investing Activities:    
Capital expenditures (63,809) (59,589)
Note receivable from AWR parent (23,000) — 
Receipt of payment of note receivable from AWR parent 23,000  — 
Other investing activities 60  58 
Net cash used (63,749) (59,531)
Cash Flows From Financing Activities:    
Receipt of advances for and contributions in aid of construction 6,814  4,630 
Refunds on advances for construction (2,922) (2,767)
Retirement or repayments of long-term debt (28,156) (210)
Net change in intercompany borrowings 43,000  42,000 
Dividends paid (24,800) (22,500)
Other financing activities (1,155) (1,610)
Net cash (used) provided (7,219) 19,543 
Net change in cash and cash equivalents (30,919) 1,045 
Cash and cash equivalents, beginning of period 35,578  401 
Cash and cash equivalents, end of period $ 4,659  $ 1,446 
Non-cash transactions:
Accrued payables for investment in utility plant $ 26,231  $ 19,815 
Property installed by developers and conveyed $ 3,401  $ 1,535 
The accompanying notes are an integral part of these financial statements
13

AMERICAN STATES WATER COMPANY AND SUBSIDIARIES
AND
GOLDEN STATE WATER COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Note 1 — Summary of Significant Accounting Policies
 
Nature of Operations: American States Water Company (“AWR”) is the parent company of Golden State Water Company (“GSWC”), Bear Valley Electric Service, Inc. ("BVESI"), and American States Utility Services, Inc. (“ASUS”) (and its wholly owned subsidiaries: Fort Bliss Water Services Company (“FBWS”), Terrapin Utility Services, Inc. (“TUS”), Old Dominion Utility Services, Inc. (“ODUS”), Palmetto State Utility Services, Inc. (“PSUS”), Old North Utility Services, Inc. (“ONUS”), Emerald Coast Utility Services, Inc. ("ECUS"), and Fort Riley Utility Services, Inc. ("FRUS")).  The subsidiaries of ASUS are collectively referred to as the “Military Utility Privatization Subsidiaries”. On July 1, 2020, GSWC completed the transfer of the electric utility assets and liabilities from its electric division to BVESI, a separate legal entity and wholly owned subsidiary of AWR (Note 11). This reorganization did not result in any substantive changes to AWR's operations and business segments. AWR, through its wholly owned subsidiaries, serves over one million people in nine states.
 GSWC and BVESI are both California public utilities. GSWC is engaged in the purchase, production, distribution and sale of water throughout California serving approximately 262,000 customer connections. BVESI distributes electricity in several San Bernardino County mountain communities in California serving approximately 24,500 customer connections. The California Public Utilities Commission (“CPUC”) regulates GSWC’s and BVESI's businesses in matters including properties, rates, services, facilities, and transactions between GSWC, BVESI, and their affiliates.
ASUS, through its wholly owned subsidiaries, operates, maintains and performs construction activities (including renewal and replacement capital work) on water and/or wastewater systems at various U.S. military bases pursuant to initial 50-year firm fixed-price contracts. These contracts are subject to annual economic price adjustments and modifications for changes in circumstances, changes in laws and regulations, and additions to the contract value for new construction of facilities at the military bases.
There is no direct regulatory oversight by the CPUC over AWR or the operations, rates or services provided by ASUS or any of its wholly owned subsidiaries.
Basis of Presentation: The consolidated financial statements and notes thereto are presented in a combined report filed by two separate Registrants: AWR and GSWC. References in this report to “Registrant” are to AWR and GSWC, collectively, unless otherwise specified. AWR owns all of the outstanding common shares of GSWC, BVESI and ASUS. ASUS owns all of the outstanding common stock of the Military Utility Privatization Subsidiaries. The consolidated financial statements of AWR include the accounts of AWR and its subsidiaries. These financial statements are prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). Intercompany transactions and balances have been eliminated in the AWR consolidated financial statements.
The consolidated financial statements included herein have been prepared by Registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).  The December 31, 2020 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. The preparation of the consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. In the opinion of management, all adjustments consisting of normal, recurring items, and estimates necessary for a fair statement of the results for the interim periods have been made. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Form 10-K for the year ended December 31, 2020 filed with the SEC.
Related Party Transactions and Financing Activities: GSWC, BVESI and ASUS provide and/or receive various support services to and from their parent, AWR, and among themselves. GSWC has allocated certain corporate office administrative and general costs to its affiliates, BVESI and ASUS, using allocation factors approved by the CPUC. GSWC allocated corporate office administrative and general costs to the electric segment of approximately $679,000 and $700,000 during the three months ended June 30, 2021 and 2020, respectively and $1.5 million for each of the six month periods ended June 30, 2021 and 2020. GSWC allocated corporate office administrative and general costs to ASUS of approximately $1.3 million and $1.2 million during the three months ended June 30, 2021 and 2020, respectively and $2.8 million and 2.7 million during the six months ended June 30, 2021 and 2020, respectively.

14

AWR borrows under a $200.0 million credit facility, which expires in May 2023, and provides funds to GSWC and ASUS in support of their operations.  The interest rate charged to GSWC and ASUS is sufficient to cover AWR’s interest expense under the credit facility. As of June 30, 2021, there was $162.0 million outstanding under this facility. BVESI has a separate $35 million revolving credit facility, which expires in July 2023. Under the terms of the credit agreement, BVESI has the option to request an increase in the facility of an additional $15 million, which is subject to approval by the financial institution. As of June 30, 2021, there was $26.0 million outstanding under this facility.
The CPUC requires GSWC to completely pay off all intercompany borrowings it has from AWR within a 24-month period. The next 24-month period in which GSWC is required to pay off its intercompany borrowings from AWR ends in May 2023.
On May 24, 2021, GSWC redeemed early its 9.56% private placement notes in the amount of $28.0 million, which pursuant to the note agreement included a redemption premium of 3.0% on par value, or $840,000. GSWC recovers redemption premiums in its embedded cost of debt as filed in cost of capital proceedings where the cost savings from redeeming higher interest rate debt are passed on to customers. Accordingly, the redemption premium has been deferred as a regulatory asset. GSWC funded the redemption by borrowing from AWR parent, which AWR, in turn, funded from its revolving credit facility.
In October 2020, AWR issued an interest bearing promissory note to GSWC, which expires in May 2023. Under the terms of the note, AWR may borrow amounts up to $30 million for working capital purposes. AWR agrees to pay any unpaid principal amounts outstanding under this note, plus accrued interest. The borrowing and repayment activity of this note is reflected on GSWC's statements of cash flows under investing activities. There were no amounts outstanding under this note as of June 30, 2021.
    COVID-19 Impact: GSWC, BVESI and ASUS have continued their operations throughout the COVID-19 pandemic given that their water, wastewater, and electric utility services are deemed essential. AWR's responses take into account orders issued by the CPUC, and the guidance provided by federal, state, and local health authorities and other government officials for the COVID-19 pandemic. Some of the actions taken by GSWC and BVESI continue to include: (i) suspending service disconnections for nonpayment pursuant to CPUC and state orders, and (ii) telecommuting by employees. On July 15, 2021, the CPUC issued a final decision in the second phase of the Low-Income Affordability Rulemaking which, among other things, extends the existing moratorium on water service disconnections due to non-payment until further CPUC guidance is issued, or February 1, 2022, whichever occurs first. On June 24, 2021, the CPUC issued a final decision to extend the moratorium on electric customer service disconnections until September 30, 2021. Under the terms of CPUC-adopted payment plans, actual electric service disconnections for non-payment will not occur until approximately December 1,
The pandemic has caused significant volatility on financial markets resulting in fluctuations in the fair value of plan assets in GSWC's pension and other retirement plans. Furthermore, as discussed above, GSWC's and BVESI's response to the pandemic required the suspension of service disconnections for nonpayment, which has significantly increased the amount of delinquent customer accounts receivable during the COVID-19 pandemic. Due to expected future credit losses on utility customer bills, GSWC and BVESI have increased their allowance for doubtful accounts for past due customer receivables. However, the CPUC has authorized GSWC and BVESI 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, such as a Catastrophic Event Memorandum Account ("CEMA"), which is to be filed with the CPUC for future recovery. GSWC and BVESI have recorded a combined total of approximately $6.7 million in these accounts as regulatory assets, as it is believed such amounts are probable of recovery. CEMA and other emergency-type memorandum accounts are well-established cost recovery mechanisms authorized as a result of a state/federal declared emergency, and are therefore recognized as regulatory assets for future recovery. As a result, the amounts recorded in the COVID-19-related memorandum accounts have not impacted GSWC's and BVESI's earnings. GSWC's COVID-19 memorandum account is being addressed in its pending water general rate case, while BVESI intends to include the memorandum account for recovery in its next general rate case application expected to be filed in 2022. Thus far, the COVID-19 pandemic has not had a material impact on ASUS's operations.
The CPUC's July 15, 2021 final decision discussed above also requires that amounts tracked in GSWC's COVID-19 CEMA account for unpaid customer bills be offset against any (i) federal and state relief for water utility bill debt, and (ii) customer payments through payment plan arrangements, prior to receiving recovery from customers. On June 28, 2021, the governor of California signed the Budget Act of 2021, which includes $1 billion in relief funding for overdue water customer bills, and $1 billion in relief funding for overdue electric customer bills. The water utility relief funding will be managed by the State Water Resources Control Board through the Community Water System COVID-19 Relief Program to provide direct assistance to community water systems to forgive customer water debt accrued during the COVID-19 pandemic. The electric utility relief funding will be managed by the California Department of Community Services and Development through the
15

California Arrearage Payment Program. Both GSWC and BVESI will participate and continue to monitor the status of federal- and state-funded utility relief programs to ensure that it receives all available funding sources.
Accounting Pronouncements Adopted in 2021:
In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes. The amendments in this update simplify the accounting for income taxes by removing certain exceptions and clarifying certain requirements regarding franchise taxes, goodwill, consolidated tax expenses, and annual effective tax rate calculations. The adoption of this guidance effective January 1, 2021 did not have a material impact on Registrant's financial statements.
16

Note 2 — Revenues
Most of Registrant's revenues are derived from contracts with customers, including tariff-based revenues from its regulated utilities at GSWC and BVESI. ASUS's initial 50-year firm fixed-price contracts with the U.S. government are considered service concession arrangements under ASC 853, Service Concession Arrangements. Accordingly, the services under these contracts are accounted for under Topic 606—Revenue from Contracts with Customers, and the water and/or wastewater systems are not recorded as Property, Plant and Equipment on Registrant’s balance sheets.
Although GSWC and BVESI have a diversified base of residential, commercial, industrial, and other customers, revenues derived from residential and commercial customers generally account for approximately 90% of total water and electric revenues. The vast majority of ASUS's revenues are from the U.S. government. For the three and six months ended June 30, 2021 and 2020, disaggregated revenues from contracts with customers by segment were as follows:
Three Months Ended June 30, Six Months Ended June 30,
(dollar in thousands) 2021 2020 2021 2020
Water:
Tariff-based revenues $ 86,687  $ 77,264  $ 160,975  $ 146,518 
Surcharges (cost-recovery activities) 975  962  1,509  1,696 
Other 523  491  1,040  986 
Water revenues from contracts with customers
88,185  78,717  163,524  149,200 
WRAM under-collection (alternative revenue program) 3,448  8,357  3,138  9,298 
Total water revenues
91,633  87,074  166,662  158,498 
Electric:
Tariff-based revenues 8,330  7,384  20,007  17,416 
Surcharges (cost-recovery activities) 44  178  246  436 
Electric revenues from contracts with customers
8,374  7,562  20,253  17,852 
BRRAM (over) under-collection (alternative revenue program) (266) 117  (606) 795 
Total electric revenues 8,108  7,679  19,647  18,647 
Contracted services:
Water 18,765  13,472  37,648  28,173 
Wastewater 9,908  13,053  21,517  25,037 
Contracted services revenues from contracts with customers 28,673  26,525  59,165  53,210 
Total AWR revenues $ 128,414  $ 121,278  $ 245,474  $ 230,355 
The opening and closing balances of the receivable from the U.S. government, contract assets, and contract liabilities from contracts with customers, which are related entirely to ASUS, were as follows:    
(dollar in thousands) June 30, 2021 December 31, 2020
Unbilled receivables $ 16,347  $ 14,924 
Receivable from the U.S. government $ 78,655  $ 74,670 
Contract assets $ 11,172  $ 10,257 
Contract liabilities $ 688  $ 1,800 
Contract Assets - Contract assets are those of ASUS and consist of unbilled revenues recognized from work-in-progress construction projects, where the right to payment is conditional on something other than the passage of time. The classification of this asset as current or noncurrent is based on the timing of when ASUS expects to bill these amounts.
Contract Liabilities - Contract liabilities are those of ASUS and consist of billings in excess of revenue recognized. The classification of this liability as current or noncurrent is based on the timing of when ASUS expects to recognize revenue.
17

Revenues for the three and six months ended June 30, 2021, which were included in contract liabilities at the beginning of the period were $186,000 and $838,000, respectively. Contracted services revenues recognized during the three and six months ended June 30, 2021 from performance obligations satisfied in previous periods were not material.
As of June 30, 2021, Registrant's aggregate remaining performance obligations, which are entirely for the contracted services segment, were $3.2 billion. Registrant expects to recognize revenue on these remaining performance obligations over the remaining term of each of the 50-year contracts, which range from 34 to 47 years. Each of the contracts with the U.S. government is subject to termination, in whole or in part, prior to the end of its 50-year term for convenience of the U.S. government.
Note 3 — Regulatory Matters
In accordance with accounting principles for rate-regulated enterprises, GSWC and BVESI record regulatory assets, which represent probable future recovery of costs from customers through the ratemaking process, and regulatory liabilities, which represent probable future refunds that are to be credited to customers through the ratemaking process. At June 30, 2021, GSWC and BVESI had approximately $23.1 million of regulatory liabilities, net of regulatory assets, not accruing carrying costs. Of this amount, (i) $77.7 million of regulatory liabilities are excess deferred income taxes arising from the lower federal income tax rate due to the Tax Cuts and Jobs Act ("Tax Act") enacted in December 2017 that are expected to be refunded to customers, (ii) $7.9 million of regulatory liabilities are from flowed-through deferred income taxes, (iii) $64.1 million of net regulatory assets relates to the underfunded position in GSWC's pension and other retirement obligations (not including the two-way pension balancing accounts), and (iv) a $2.8 million regulatory liability related to a memorandum account authorized by the CPUC to track unrealized gains and losses on BVESI's purchase power contracts over the term of the contracts. The remainder relates to other items that do not provide for or incur carrying costs.
Regulatory assets represent costs incurred by GSWC and/or BVESI for which they have received or expect to receive rate recovery in the future. In determining the probability of costs being recognized in other periods, GSWC and BVESI consider regulatory rules and decisions, past practices, and other facts or circumstances that would indicate if recovery is probable. If the CPUC determines that a portion of either GSWC’s or BVESI's assets are not recoverable in customer rates, the applicable utility must determine if it has suffered an asset impairment that requires it to write down the asset's value. Regulatory assets are offset against regulatory liabilities within each ratemaking area. Amounts expected to be collected or refunded in the next twelve months have been classified as current assets and current liabilities by ratemaking area. Regulatory assets, less regulatory liabilities, included in the consolidated balance sheets are as follows:
(dollars in thousands) June 30,
2021
December 31,
2020
GSWC
Water Revenue Adjustment Mechanism and Modified Cost Balancing Account $ 20,787  $ 13,741 
Costs deferred for future recovery on Aerojet case 6,116  6,751 
Pensions and other post-retirement obligations (Note 8) 63,809  65,576 
COVID-19 memorandum accounts 6,226  4,119 
Excess deferred income taxes (73,668) (74,185)
Flow-through taxes, net (7,323) (9,722)
Other regulatory assets 11,491  10,670 
Various refunds to customers (4,187) (4,577)
Total GSWC $ 23,251  $ 12,373 
BVESI
Derivative unrealized (gain) loss (Note 5) (2,810) 1,537
Other regulatory assets 3,297 2,629
Total AWR $ 23,738  $ 16,539 
Regulatory matters are discussed in the consolidated financial statements and the notes thereto included in the Company's Form 10-K for the year ended December 31, 2020 filed with the SEC. The discussion below focuses on significant matters and developments since December 31, 2020.
Alternative-Revenue Programs:
GSWC records the difference between what it bills its water customers and that which is authorized by the CPUC using the Water Revenue Adjustment Mechanism ("WRAM") and the Modified Cost Balancing Account (“MCBA”) accounts approved by the CPUC.  The over- or under-collection of the WRAM is aggregated with the MCBA over- or under-collection for the corresponding ratemaking area and bears interest at the current 90-day commercial paper rate. 
18

As required by the accounting guidance for alternative revenue programs, GSWC is required to collect its WRAM balances within 24 months following the year in which an under-collection is recorded in order to recognize such amounts as revenue.  The recovery periods for the majority of GSWC's WRAM/MCBA balances are primarily within 12 to 24 months. During the six months ended June 30, 2021, GSWC recorded additional net under-collections in the WRAM/MCBA accounts of approximately $8.7 million due primarily to higher-than-adopted supply costs currently in billed customer rates. As of June 30, 2021, GSWC had an aggregated regulatory asset of $20.8 million, which is comprised of a $4.4 million under-collection in the WRAM accounts and a $16.4 million under-collection in the MCBA accounts.
COVID-19 Memorandum Accounts:
The CPUC has approved GSWC's and BVESI's requests to activate COVID-19-related memorandum accounts, such as a Catastrophic Event Memorandum Account ("CEMA"), for the impact of the COVID-19 pandemic. GSWC's and BVESI's response to the pandemic has included suspending service disconnections for nonpayment, which has significantly increased the amount of delinquent customer accounts receivable during the COVID-19 pandemic. Costs incurred by GSWC and BVESI in response to the COVID-19 pandemic, including bad debt expense in excess of what is included in their respective revenue requirements, are being included in the COVID-19-related memorandum accounts for future recovery. As of June 30, 2021, a total of $6.7 million in COVID-19 related incremental costs have been recorded as regulatory assets as GSWC and BVESI believe their respective costs are probable of recovery. GSWC's COVID-19 memorandum account is being addressed in its pending water general rate case, while BVESI intends to include the memorandum account for recovery in its next general rate case application expected to be filed in 2022.
Other Regulatory Assets:
Other regulatory assets represent costs incurred by GSWC or BVESI for which they have received or expect to receive rate recovery in the future. These regulatory assets are supported by regulatory rules and decisions, past practices, and other facts or circumstances that indicate recovery is probable. If the CPUC determines that a portion of either GSWC’s or BVESI's assets are not recoverable in customer rates, the applicable entity must determine if it has suffered an asset impairment that requires it to write down the asset's value. Included in other regulatory assets are CPUC-approved memorandum accounts to track the costs incurred in connection with the development and implementation of BVESI’s wildfire mitigation plans (“WMPs”), which are required by California legislation to be submitted annually to the CPUC for approval. The CPUC’s Wildfire Safety Division (now part of the California Natural Resources Agency effective July 1, 2021) has engaged an independent accounting firm to conduct examinations of the expenses and capital investments identified in the 2019 and 2020 WMPs for each of the investor-owned electric utilities, including BVESI. As of June 30, 2021, BVESI has approximately $1.9 million related to expenses accumulated in its WMPs memorandum accounts that have been recognized as regulatory assets for future recovery. BVESI’s examination of these expenses as well as the capital investments incurred for its WMPs is currently in progress and, at this time, management cannot predict the outcome or recommendations that may result from this examination.
BVESI Other CEMA Regulatory Asset: BVESI activated a CEMA account to track the incremental costs incurred in response to a severe winter storm that occurred in February 2019 and which resulted in the declaration of an emergency by the governor of California. Incremental costs of $455,000 were included in the CEMA account and recorded as a regulatory asset. BVESI subsequently filed for recovery of these costs. In May 2021, the CPUC issued a final decision denying BVESI’s request for recovery, claiming that BVESI did not adequately demonstrate that the costs incurred were incremental and beyond costs already included in BVESI’s revenue requirement. The decision does permit BVESI to file a new application on the issue of incrementality should it wish to continue pursuing recovery. BVESI believes the storm costs were incremental and beyond what was included in its revenue requirement and will file a new application to continue pursuing recovery. As a result, the costs in this CEMA account remain as a regulatory asset at June 30, 2021 as the Company continues to believe the incremental costs were properly tracked and included in the CEMA account consistent with the CPUC's well-established past practices. The CPUC allows CEMA accounts to be established following a state/federal declared emergency, and are therefore recognized as regulatory assets for future recovery. However, if BVESI does not ultimately prevail in obtaining recovery, it will result in a charge to earnings for the write-off of this CEMA regulatory asset totaling $455,000. At this time, management cannot predict the final outcome of this matter.

19

Note 4 — Earnings per Share/Capital Stock
In accordance with the accounting guidance for participating securities and earnings per share (“EPS”), Registrant uses the “two-class” method of computing EPS. The “two-class” method is an earnings allocation formula that determines EPS for each class of common stock and participating security. AWR has participating securities related to restricted stock units that earn dividend equivalents on an equal basis with AWR’s Common Shares, and that have been issued under AWR's stock incentive plans for employees and the non-employee directors stock plans.  In applying the “two-class” method, undistributed earnings are allocated to both common shares and participating securities.
The following is a reconciliation of Registrant’s net income and weighted average Common Shares outstanding used for calculating basic net income per share:
Basic:  For The Three Months Ended 
 June 30,
 For The Six Months Ended 
 June 30,
(in thousands, except per share amounts) 2021 2020 2021 2020
Net income $ 26,576  $ 25,612  $ 45,844  $ 39,684 
Less: (a) Distributed earnings to common shareholders 12,366  11,250  24,727  22,492 
Distributed earnings to participating securities 35  40  65  77 
Undistributed earnings 14,175  14,322  21,052  17,115 
          (b) Undistributed earnings allocated to common shareholders 14,135  14,271  20,997  17,057 
Undistributed earnings allocated to participating securities 40  51  55  58 
Total income available to common shareholders, basic (a)+(b) $ 26,501  $ 25,521  $ 45,724  $ 39,549 
Weighted average Common Shares outstanding, basic 36,916  36,884  36,907  36,872 
Basic earnings per Common Share $ 0.72  $ 0.69  $ 1.24  $ 1.07 

Diluted EPS is based upon the weighted average number of Common Shares, including both outstanding shares and shares potentially issuable in connection with restricted stock units granted under AWR’s stock incentive plans for employees and the non-employee directors stock plans, and net income. There were no options outstanding as of June 30, 2021 and 2020 under these plans. At June 30, 2021 and 2020, there were 107,772 and 133,863 restricted stock units outstanding, respectively, including performance shares awarded to officers of the Registrant.
The following is a reconciliation of Registrant’s net income and weighted average Common Shares outstanding for calculating diluted net income per share:
Diluted: For The Three Months Ended 
 June 30,
 For The Six Months Ended 
 June 30,
(in thousands, except per share amounts) 2021 2020 2021 2020
Common shareholders earnings, basic $ 26,501  $ 25,521  $ 45,724  $ 39,549 
Undistributed earnings for dilutive stock-based awards 40  51  55  58 
Total common shareholders earnings, diluted $ 26,541  $ 25,572  $ 45,779  $ 39,607 
Weighted average common shares outstanding, basic 36,916  36,884  36,907  36,872 
Stock-based compensation (1) 91  116  86  113 
Weighted average common shares outstanding, diluted 37,007  37,000  36,993  36,985 
Diluted earnings per Common Share $ 0.72  $ 0.69  $ 1.24  $ 1.07 
(1)     All of the 107,772 and 133,863 restricted stock units at June 30, 2021 and 2020, respectively, were included in the calculation of diluted EPS for the three and six months ended June 30, 2021 and 2020.
During the six months ended June 30, 2021, AWR issued 42,668 common shares related to restricted stock units. During the six months ended June 30, 2020, AWR issued 37,260 common shares related to restricted stock units and stock options for approximately $30,000, under Registrant’s stock incentive plans for employees.
20

During the six months ended June 30, 2021 and 2020, AWR paid $1.3 million and $1.8 million, respectively, to taxing authorities on employees' behalf for shares withheld related to net share settlements. During the six months ended June 30, 2021 and 2020, GSWC paid $1.2 million and $1.6 million, respectively, to taxing authorities on employees' behalf for shares withheld related to net share settlements. These payments are included in the stock-based compensation caption of the statements of equity.
During the three months ended June 30, 2021 and 2020, AWR paid quarterly dividends of approximately $12.4 million, or $0.335 per share, and $11.3 million, or $0.305 per share, respectively. During the six months ended June 30, 2021 and 2020, AWR paid quarterly dividends of approximately $24.7 million, or $0.670 per share, and $22.5 million, or $0.610 per share, respectively.
During the three months ended June 30, 2021 and 2020, GSWC paid dividends of $12.4 million and $11.3 million, respectively, to AWR during these periods. During the six months ended June 30, 2021 and 2020, GSWC paid dividends of $24.8 million and $22.5 million, respectively, to AWR during these periods.
Note 5 — Derivative Instruments
BVESI purchases power under long-term contracts at a fixed cost depending on the amount of power and the period during which the power may be purchased under such contracts.  These contracts provide power at a fixed cost over approximately three- and five-year terms depending on the amount of power and period during which the power is purchased under the contracts.
BVESI's purchase power contracts are subject to the accounting guidance for derivatives and require mark-to-market derivative accounting. Among other things, the CPUC authorized the use of a regulatory asset and liability memorandum account to offset the mark-to-market entries required by the accounting guidance.  Accordingly, all unrealized gains and losses generated from the purchased power contracts are deferred on a monthly basis into a non-interest bearing regulatory memorandum account that tracks the changes in fair value of the derivative throughout the terms of the contracts. As a result, these unrealized gains and losses did not impact AWR’s earnings. As of June 30, 2021, there was a $2.8 million unrealized gain recorded as a regulatory liability in the memorandum account for the purchased power contracts. The notional volume of derivatives remaining under these long-term contracts as of June 30, 2021 was 417,649 megawatt hours.
The accounting guidance for fair value measurements applies to all financial assets and financial liabilities that are measured and reported on a fair value basis. Under the accounting guidance, BVESI has made fair value measurements that are classified and disclosed in one of the following three categories:
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2: Quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; or
Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
To value the contracts, Registrant utilizes various inputs that include quoted market prices for energy over the duration of the contracts. The market prices used to determine the fair value for this derivative instrument were estimated based on independent sources such as broker quotes and publications that are not observable in or corroborated by the market.  When such inputs have a significant impact on the measurement of fair value, the instruments are categorized as Level 3. Accordingly, the valuation of the derivatives on Registrant’s purchased power contract has been classified as Level 3 for all periods presented.
The following table presents changes in the fair value of the Level 3 derivatives for the three and six months ended June 30, 2021 and 2020. The change in fair value was due to an increase in energy prices during the three and six months ended June 30, 2021.
 For The Three Months Ended 
 June 30,
 For The Six Months Ended 
 June 30,
(dollars in thousands) 2021 2020 2021 2020
Fair value at beginning of the period $ 1,224  $ (4,280) $ (1,537) $ (3,171)
Unrealized gains (losses) on purchased power contracts 1,586  453  4,347  (656)
Fair value at end of the period $ 2,810  $ (3,827) $ 2,810  $ (3,827)

21

Note 6 — Fair Value of Financial Instruments
For cash and cash equivalents, accounts receivable, accounts payable and short-term debt, the carrying amount is assumed to approximate fair value due to the short-term nature of these items.
Investments held in a Rabbi Trust for the supplemental executive retirement plan ("SERP") are measured at fair value and totaled $28.1 million as of June 30, 2021. All equity investments in the Rabbi Trust are Level 1 investments in mutual funds. The investments held in the Rabbi Trust are included in "Other Property and Investments" on Registrant's balance sheets.
The table below estimates the fair value of long-term debt held by GSWC. The fair values as of June 30, 2021 and December 31, 2020 were determined using rates for similar financial instruments of the same duration utilizing Level 2 methods and assumptions. Changes in the assumptions will produce different results.
June 30, 2021 December 31, 2020
(dollars in thousands) Carrying Amount Fair Value Carrying Amount Fair Value
Financial liabilities:        
Long-term debt—GSWC (1)
$ 416,115  $ 494,861  $ 444,271  $ 559,752 
___________________
(1) Excludes debt issuance costs.

Note 7 — Income Taxes
AWR's effective income tax rate (“ETR”) was 21.9% and 24.4% for the three months ended June 30, 2021 and 2020, respectively, and was 22.6% and 23.5% for the six months ended June 30, 2021 and 2020, respectively. GSWC's ETR was 22.1% and 25.9% for the three months ended June 30, 2021 and 2020, respectively, and was 22.7% and 24.7% for the six months ended June 30, 2021 and 2020, respectively.
The AWR and GSWC effective tax rates differed from the federal corporate statutory tax rate of 21% primarily due to (i) state taxes; (ii) permanent differences, including the excess tax benefits from share-based payments, which were reflected in the income statements and resulted in a reduction to income tax expense during the three and six months ended June 30, 2021 and 2020; (iii) the ongoing amortization of the excess deferred income tax liability; and (iv) differences between book and taxable income that are treated as flow-through adjustments in accordance with regulatory requirements (principally from plant, rate-case, and compensation related items). As a regulated utility, GSWC treats certain temporary differences as flow-through in computing its income tax expense consistent with the income tax method used in its CPUC-jurisdiction ratemaking. Flow-through items either increase or decrease tax expense and thus impact the ETR.
22

Note 8 — Employee Benefit Plans
The components of net periodic benefit costs for Registrant’s pension plan, postretirement medical benefit plan and SERP for the three and six months ended June 30, 2021 and 2020 were as follows:
For The Three Months Ended June 30,
  Pension Benefits Other
Postretirement
Benefits
SERP
(dollars in thousands) 2021 2020 2021 2020 2021 2020
Components of Net Periodic Benefits Cost:            
Service cost $ 1,625  $ 1,372  $ 40  $ 47  $ 348  $ 244 
Interest cost 1,712  1,986  31  56  229  247 
Expected return on plan assets (3,134) (2,950) (134) (127) —  — 
Amortization of prior service cost 109  109  —  —  —  — 
Amortization of actuarial (gain) loss 993  526  (287) (199) 419  211 
Net periodic benefits costs under accounting standards 1,305  1,043  (350) (223) 996  702 
Regulatory adjustment - deferred (351) (148) —  —  —  — 
Total expense (benefit) recognized, before surcharges and allocation to overhead pool $ 954  $ 895  $ (350) $ (223) $ 996  $ 702 
For The Six Months Ended June 30,
Pension Benefits Other
Postretirement
Benefits
SERP
(dollars in thousands) 2021 2020 2021 2020 2021 2020
Components of Net Periodic Benefits Cost:
Service cost $ 3,250  $ 2,780  $ 80  $ 94  $ 696  $ 488 
Interest cost 3,424  3,940  62  112  458  494 
Expected return on plan assets (6,268) (5,900) (268) (254) —  — 
Amortization of prior service cost 218  218  —  —  —  — 
Amortization of actuarial (gain) loss 1,986  968  (574) (398) 838  422 
Net periodic benefits costs under accounting standards 2,610  2,006  (700) (446) 1,992  1,404 
Regulatory adjustment - deferred (702) (241) —  —  —  — 
Total expense (benefit) recognized, before surcharges and allocation to overhead pool $ 1,908  $ 1,765  $ (700) $ (446) $ 1,992  $ 1,404 
In September 2021, Registrant expects to contribute approximately $3.5 million to its pension plan.
As authorized by the CPUC in the water and electric general rate case decisions, GSWC and BVESI each utilize two-way balancing accounts to track differences between the forecasted annual pension expenses in rates, or expected to be in rates, and the actual annual expense recorded in accordance with the accounting guidance for pension costs. 
During the three months ended June 30, 2021 and 2020, GSWC's actual pension expense was higher than the amounts included in water customer rates by $351,000 and $148,000, respectively. During the six months ended June 30, 2021 and 2020, GSWC's actual pension expense was higher than the amounts included in water customer rates by $702,000 and $241,000, respectively. BVESI's actual expense was lower than the amounts included in electric customer rates for all periods presented. As of June 30, 2021, GSWC and BVESI had over-collections in their two-way pension balancing accounts of $315,000 and $102,000, respectively, included as part of regulatory assets and liabilities (Note 3).
23

Note 9 — Contingencies
Environmental Clean-Up and Remediation:
GSWC has been involved in environmental remediation and cleanup at one of its plant sites that contained an underground storage tank which was used to store gasoline for its vehicles. This tank was removed from the ground in July 1990 along with the dispenser and ancillary piping. Since then, GSWC has been involved in various remediation activities at this site.  Analysis indicates that off-site monitoring wells may be necessary to document effectiveness of remediation.
As of June 30, 2021, the total amount spent to clean up and remediate GSWC’s plant facility was approximately $6.0 million, of which $1.5 million has been paid by the State of California Underground Storage Tank Fund. Amounts paid by GSWC have been included in rate base and approved by the CPUC for recovery. As of June 30, 2021, GSWC has a regulatory asset and an accrued liability for the estimated additional cost of $1.3 million to complete the cleanup at the site. The estimate includes costs for two years of continued activities of groundwater cleanup and monitoring, future soil treatment and site-closure-related activities. The ultimate cost may vary as there are many unknowns in remediation of underground gasoline spills and this is an estimate based on currently available information. Management also believes it is probable that the estimated additional costs will be approved in rate base by the CPUC.
Other Litigation:
Registrant is also subject to other ordinary routine litigation incidental to its business, some of which may include claims for compensatory and punitive damages. Management believes that rate recovery, proper insurance coverage and reserves are in place to insure against, among other things, property, general liability, employment, and workers’ compensation claims incurred in the ordinary course of business. Insurance coverage may not cover certain claims involving punitive damages. Registrant does not believe the outcome from any pending suits or administrative proceedings will have a material effect on Registrant's consolidated results of operations, financial position, or cash flows.
24

Note 10 — Business Segments
AWR has three reportable segments: water, electric and contracted services. Prior to July 1, 2020, GSWC had two segments, water and electric. On July 1, 2020, GSWC completed the transfer of the electric utility assets and liabilities from its electric division to BVESI, a separate legal entity and now a wholly owned subsidiary of AWR (Note 11). On a stand-alone basis, AWR has no material assets or liabilities other than its equity investments in its subsidiaries, note payables to its subsidiaries and deferred taxes. 
All activities of GSWC and BVESI are geographically located within California. Activities of ASUS and its subsidiaries are conducted in California, Florida, Georgia, Kansas, Maryland, New Mexico, North Carolina, South Carolina, Texas and Virginia.  Each of ASUS’s wholly owned subsidiaries is regulated, if applicable, by the state in which the subsidiary primarily conducts water and/or wastewater operations.  Fees charged for operations and maintenance and renewal and replacement services are based upon the terms of the contracts with the U.S. government, which have been filed, as appropriate, with the commissions in the states in which ASUS’s subsidiaries are incorporated.
The tables below set forth information relating to AWR’s operating segments and AWR Parent. The utility plant amounts are net of respective accumulated provisions for depreciation. Capital additions reflect capital expenditures paid in cash, excluding U.S. government- and third-party contractor-funded capital expenditures for ASUS and property installed by developers and conveyed to GSWC or BVESI.
  As Of And For The Three Months Ended June 30, 2021
  Contracted AWR Consolidated
(dollars in thousands) Water Electric  Services Parent AWR
Operating revenues $ 91,633  $ 8,108  $ 28,673  $ —  $ 128,414 
Operating income (loss) 30,777  1,795  5,278  (3) 37,847 
Interest expense, net 5,464  88  (88) 220  5,684 
Net property, plant and equipment 1,450,519  98,496  21,618  —  1,570,633 
Depreciation and amortization expense (1) 8,213  642  915  —  9,770 
Income tax expense (benefit) 5,957  458  1,271  (224) 7,462 
Capital additions 31,985  6,416  653  —  39,054 
  As Of And For The Three Months Ended June 30, 2020
  Contracted AWR Consolidated
(dollars in thousands) Water Electric Services Parent AWR
Operating revenues $ 87,074  $ 7,679  $ 26,525  $ —  $ 121,278 
Operating income (loss) 28,662  1,513  5,543  (2) 35,716 
Interest expense, net 4,857  139  (220) 56  4,832 
Net property, plant and equipment 1,353,671  80,343  22,384  —  1,456,398 
Depreciation and amortization expense (1) 7,601  608  822  —  9,031 
Income tax expense (benefit) 6,970  339  1,301  (329) 8,281 
Capital additions 22,076  5,500  1,467  —  29,043 
  As Of And For The Six Months Ended June 30, 2021
  Contracted AWR Consolidated
(dollars in thousands) Water Electric  Services Parent AWR
Operating revenues $ 166,662  $ 19,647  $ 59,165  $ —  $ 245,474 
Operating income (loss) 51,836  5,243  11,102  (5) 68,176 
Interest expense, net 11,175  174  (317) 455  11,487 
Net property, plant and equipment 1,450,519  98,496  21,618  —  1,570,633 
Depreciation and amortization expense (1) 16,275  1,281  1,774  —  19,330 
Income tax expense (benefit) 9,725  1,342  2,662  (353) 13,376 
Capital additions 63,809  11,198  1,140  —  76,147 

25

  As Of And For The Six Months Ended June 30, 2020
  Contracted AWR Consolidated
(dollars in