Global Water Resources, Inc.

3. Regulatory Matters

Recent ACC Rulings and Activity

2025 GW-Santa Cruz and GW-Palo Verde Rate Cases

On March 5, 2025, GW-Santa Cruz and GW-Palo Verde each filed a general rate case application and related schedules with the ACC for, among other things, increased water and wastewater rates, respectively, based on a test year ended December 31, 2024, with updates for post-test year plant. On October 1, 2025, the ACC Utilities Division (“ACC Staff”) and RUCO filed their respective initial written testimonies with the ACC in the rate cases, with subsequent rebuttal, surrebuttal and rejoinder testimonies having been filed by the parties.

On April 28, 2026, the parties entered into a settlement agreement (the “Settlement Agreement”) to bifurcate thetwo rate cases pursuant to which, among other things: (i) the GW-Santa Cruz rate case has settled; (ii) GW-Palo Verde would withdraw its rate case application with the intent of refiling its rate case in 2027 using a 2026 test year; and (iii) GW-Palo Verde would seek authorization to increase the temporary bill credit for customers related to the Company’s Southwest Plant that was originally approved in connection with Decision No. 79424 issued by the ACC.

In addition, under the terms of the Settlement Agreement, the parties have agreed to, among other things: (i) an increase in GW-Santa Cruz’s annual revenue requirement of approximately $2.3 million; (ii) a requested effective date of the new rates for GW-Santa Cruz of November 1, 2026; and (iii) $3.4 million of utility plant for GW-Santa Cruz would be classified as plant held for future use for ratemaking purposes. The settlement preserves the Company’s ability to seek inclusion of these assets in rate base

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On July 9, 2026, GW-Palo Verde filed a motion to withdraw its rate application in accordance with the Settlement Agreement. On July 29, 2026, the ALJ issued a procedural order granting the motion to withdraw the GW-Palo Verde rate application. Hearings on the GW-Santa Cruz rate case concluded on August 3, 2026.

On September 30, 2026, GW-Palo Verde filed a motion requesting an amendment to Decision No. 79424 to increase the amount of the temporary bill credit for customers related to the Company’s Southwest Plant. If approved, the impact of the increased bill credit would reduce revenue by an additional $0.4 million annually with the final resolution relating to this bill credit to be addressed in GW-Palo Verde’s 2027 rate review.

On October 19, 2026, the ALJ issued a Recommended Opinion and Order, which recommended the ACC adopt the Settlement Agreement with the new rates for GW-Santa Cruz effective December 1, 2026. The Company expects a decision on the Settlement Agreement at the ACC’s November 4, 2026 open meeting. There can be no assurance that the ACC will approve the Settlement Agreement in the form filed or otherwise modify provisions contained therein.Therefore, no adjustments related to this settlement have been reflected in the accompanying Condensed Consolidated Financial Statements (unaudited).

2024 GW-Farmers Rate Case - Decision No. 80695 - Issued April 29, 2025

On June 27, 2024, GW-Farmers filed a rate case application with the ACC for increased water rates based on a 2023 test year, with updates for changes in post-test year plant through December 31, 2024. On April 29, 2025, the ACC approved GW-Farmers’ rate case application in Decision No. 80695. Among other approvals, Decision No. 80695 approved an increase in GW-Farmers’ annual revenue requirement of $1.1 million and a return on equity of 9.6%, with increased rates to be phased-in over three periods.50% of the increase was effective on May 1, 2025, with another 25% effective on November 1, 2025. The final 25% increase was phased in on May 1, 2026. In addition to the rate increase, Decision No. 80695 also approved a deferral of the recovery of an acquisition premium of approximately $3 million related to the Company’s acquisition of GW-Farmers, which the Company recorded as of March 31, 2025. Decision No. 80695 calls for the acquisition premium to be recovered in a future rate case, subject to the GW-Farmers utility being found viable by the ACC.

Southwest Service Area Wastewater Collection Mains and Recycled Water Mains

In January 2024, the Company discovered that approximately $7.8 million of construction costs for wastewater mains and recycled water mains in the Company’s Southwest service area had been prematurely included as “plant in service” for rate-making purposes in 2007, and were reflected in the calculation of customer rates in Decision No. 71878 (September 15, 2010). Those costs were also included as “plant in service” in Decision No. 74364 (February 26, 2014) and Decision No. 78644 (July 27, 2022). The Company disclosed this circumstance to the ACC on March 1, 2024, and on April 25, 2024, GW-Palo Verde filed an application with the ACC requesting a monthly bill credit for customers that would be in place until the conclusion of the next GW-Palo Verde rate case. The ACC issued Decision No. 79424 on July 18, 2024 approving the bill credit with an effective date of August 1, 2024. The bill credit reduced revenue earned by $0.2 million for both of the three months ended September 30, 2026 and 2025 and $0.5 million for both of the nine months ended September 30, 2026 and 2025. For additional information regarding the bill credit, refer to “2025 GW-Santa Cruz and GW-Palo Verde Rate Cases” above.

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