American Water (NYSE: AWK) details California and Virginia rate settlements
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
American Water Works Company, Inc. reports progress in regulatory rate cases for two key subsidiaries in California and Virginia. California-American Water reached a partial settlement with California’s Public Advocates Office that would allow additional annualized water and wastewater revenues of $24 million in 2027, $21 million in 2028, and $22 million in 2029 if construction work in progress remains in rate base, compared with the company’s revised 2027 request of $43 million.
Virginia American Water filed a black box settlement with Virginia regulators providing a $16 million annualized revenue increase versus its original $22 million request, driven mainly by about $115 million in capital investments planned between May 2025 and April 2027. The stipulation also reflects an agreed return on equity of 9.75% and an equity ratio of 51.79%, both to be used in future regulatory filings, subject to commission approvals.
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Insights
Settlements clarify prospective revenues for two key regulated subsidiaries.
American Water details settlement outcomes that frame future allowed revenues in California and Virginia. California-American’s partial settlement points to incremental annualized revenues of $24 million, $21 million, and $22 million over 2027–2029, tied to about $750 million of capital investment.
In Virginia, the agreed $16 million annualized increase and a 9.75% return on equity with a 51.79% equity layer will guide future filings. All outcomes remain subject to state commission decisions, so actual financial impact depends on final orders and the unresolved CWIP treatment in California.
8-K Event Classification
2 items: 8.01, 9.01
2 items
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Cal Am incremental revenue 2027: $24 million annualized
Cal Am incremental revenue 2028: $21 million annualized
Cal Am incremental revenue 2029: $22 million annualized
+5 more
8 metrics
Cal Am incremental revenue 2027
$24 million annualized
Test year 2027 under California partial settlement if CWIP remains in rate base
Cal Am incremental revenue 2028
$21 million annualized
Escalation year 2028 under California partial settlement if CWIP remains in rate base
Cal Am incremental revenue 2029
$22 million annualized
Attrition year 2029 under California partial settlement if CWIP remains in rate base
Cal Am revised 2027 request
$43 million annualized
Company’s revised proposed increase above 2026 expected revenues in California test year 2027
Virginia revenue increase
$16 million annualized
Agreed annualized increase in Virginia American Water’s settlement versus $22 million originally sought
Virginia capital investments
$115 million
Capital investments completed and planned between May 2025 and April 2027 driving Virginia revenue increase
Virginia allowed ROE
9.75%
Return on equity for Virginia American Water to be used in future filings under settlement
Virginia equity ratio
51.79%
Equity component of capital structure for Virginia American Water in future regulatory filings
Key Terms
general rate case, construction work in progress, return on equity, capital structure, +2 more
6 terms
general rate case financial
"filed with the California Public Utilities Commission (the “CPUC”) a partial settlement agreement… in its general rate case filed on July 1, 2025"
A general rate case is a formal regulatory proceeding where a public utility asks a government agency for permission to change the prices charged to customers. It matters to investors because the outcome determines the company’s allowed revenue and profit margin—similar to a landlord getting approval to raise rent—which directly affects future cash flow, dividend capacity and the valuation of the utility’s stock or bonds.
construction work in progress financial
"The treatment in the general rate case of construction work in progress (“CWIP”) is the only primary issue that remains pending"
return on equity financial
"that its return on equity (“ROE”) will be 9.75% and its capital structure will consist of an equity component of 51.79%"
Return on equity shows how effectively a company uses its shareholders' money to generate profit. It is calculated by dividing the company's net profit by its shareholders' equity, indicating how much profit is earned for each dollar invested by owners. Higher return on equity suggests the company is good at turning investments into earnings, which can be an important factor for investors assessing its profitability and efficiency.
capital structure financial
"its capital structure will consist of an equity component of 51.79%"
Capital structure is the way a company finances its operations and growth by using different sources of money, such as borrowed funds (loans or bonds) and owner’s equity (investments from owners or shareholders). It’s like a recipe for baking a cake, where the balance of ingredients affects the final product's strength and taste; similarly, the mix of debt and equity influences a company's stability and risk. For investors, understanding a company's capital structure helps gauge how risky it might be to invest or lend money.
attrition year financial
"would be $24 million in the 2027 test year, $21 million in the 2028 escalation year, and $22 million in the 2029 attrition year"
black box stipulation financial
"filed… a “black box” stipulation of settlement (the “Stipulation”) entered into on June 5, 2026"
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 5, 2026
(Exact name of registrant as specified in its charter)
Commission File Number: 001-34028
| (State or other jurisdiction of incorporation) | (IRS Employer Identification No.) | ||||
(Address of principal executive offices, including zip code)
(856 ) 955-4001
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).
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. ☐
Item 8.01. Other Events.
Partial Settlement Agreement Filed in California-American Water Company (“Cal Am”) General Rate Case
On June 8, 2026, Cal Am, a wholly owned subsidiary of American Water Works Company, Inc. (the “Company”), filed with the California Public Utilities Commission (the “CPUC”) a partial settlement agreement reached with the CPUC’s Public Advocates Office to determine the amount of incremental annualized water and wastewater revenue to be received by Cal Am in its general rate case filed on July 1, 2025. The requested annualized incremental revenue was driven primarily by approximately $750 million of capital investments completed and planned by Cal Am from 2025 to 2028.
Under the partial settlement agreement, the total incremental annualized water and wastewater revenue to be received by Cal Am would be $24 million in the 2027 test year, $21 million in the 2028 escalation year, and $22 million in the 2029 attrition year. The Company’s revised proposed position in this general rate case was $43 million in the 2027 test year (updated to reflect a current level of revenue and sales), an estimated $22 million in the 2028 escalation year, and an estimated $26 million in the 2029 attrition year. The treatment in the general rate case of construction work in progress (“CWIP”) is the only primary issue that remains pending in the general rate case. If CWIP is ultimately excluded from rate base, it is estimated that the incremental annualized water and wastewater revenues to be received by Cal Am for the 2027 test year and the 2028 escalation year would decrease to $20 million and $19 million, respectively, and would remain at $22 million in the 2029 attrition year. New rates would be implemented by Cal Am as of January 1, 2027 upon a final decision issued by the CPUC with respect to the partial settlement agreement.
A copy of the press release issued by Cal Am on June 9, 2026 to announce the filing of the partial settlement agreement with the CPUC has been filed as Exhibit 99.1 hereto and is incorporated herein by reference. References and links to websites and other information contained in this press release are not provided as active hyperlinks, and the information contained in or accessed through these hyperlinks shall not be incorporated into, or form a part of, this Current Report on Form 8-K.
Stipulation of Settlement Filed in Virginia-American Water Company (“Virginia American Water”) General Rate Case
On June 5, 2026, Virginia American Water, a wholly owned subsidiary of the Company, filed with the Virginia State Corporation Commission (the “VSCC”) a “black box” stipulation of settlement (the “Stipulation”) entered into on June 5, 2026 with the staff of the VSCC and several intervenors, with respect to a general rate case filed by Virginia American Water on November 3, 2025. Virginia American Water sought in the general rate case approximately $22 million of increased annualized water and wastewater revenues. The parties to the Stipulation agreed to a $16 million annualized increase in Virginia American Water’s revenues, and have also agreed, solely for purposes of Virginia American Water’s future filings requiring a stated cost of capital and/or capital structure (including its annual information and water and wastewater infrastructure surcharge filings), that its return on equity (“ROE”) will be 9.75% and its capital structure will consist of an equity component of 51.79%. In Virginia-American Water’s last rate case, the general rate case order had approved, solely for purposes of Virginia American Water’s future filings requiring a stated cost of capital and/or capital structure (including its annual information and water and wastewater infrastructure surcharge filings), an ROE of 9.70% and a capital structure consisting of an equity component of 45.67%.
The annualized revenue increase is driven primarily by approximately $115 million in capital investments completed and planned to be made by Virginia-American Water between May 2025 and April 2027. The Stipulation remains subject to VSCC review and approval. Interim rates became effective May 2, 2026, with the difference between interim and final approved rates subject to refund.
A copy of the press release issued by Virginia American Water on June 9, 2026 to announce the filing of the Stipulation with the VSCC has been filed as Exhibit 99.2 hereto and is incorporated herein by reference. References and links to websites and other information contained in this press release are not provided as active hyperlinks, and the information contained in or accessed through these hyperlinks shall not be incorporated into, or form a part of, this Current Report on Form 8-K.
Cautionary Statement Concerning Forward-Looking Statements
Certain statements included in this Current Report on Form 8-K (or the exhibits thereto) are forward-looking statements within the meaning of Section 27A of the Securities Act, Section 21E of the Exchange Act and the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by words with prospective meanings such as “intend,” “plan,” “estimate,” “believe,” “anticipate,” “expect,” “predict,” “project,” “propose,” “assume,” “forecast,” “outlook,” “future,” “pending,” “goal,” “objective,” “potential,” “continue,” “seek to,” “may,” “can,” “will,” “should” and “could,” or the negative of such terms or other variations or similar expressions. These forward-looking statements are predictions based on the Company’s current expectations and assumptions regarding future events. They are not guarantees or
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assurances of any outcomes, performance or achievements, and readers are cautioned not to place undue reliance upon them. The forward-looking statements are subject to a number of estimates and assumptions, and known and unknown risks, uncertainties and other factors. Actual results may differ materially from those discussed in the forward-looking statements included in this Current Report on Form 8-K as a result of the factors discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission (the “SEC”) on February 18, 2026, and other filings with the SEC, and additional risks and uncertainties, including with respect to (1) the receipt of a final decision or order as to each partial settlement agreement; (2) the resolution by the CPUC of issues in Cal Am’s general rate case not addressed by the partial settlement agreement, including with respect to CWIP; (3) the terms of the general rate case as reflected in the final decision or order (including, without limitation, with respect to any total annualized revenue increase reflected therein); (4) the timing of final decisions or orders and the implementation of new rates; (5) the occurrence of benefits to Cal Am and Virginia American Water arising from such respective final decisions or orders; (6) unexpected costs, liabilities or delays associated with the resolution of each of Cal Am’s and/or Virginia American Water’s general rate case; (7) regulatory, legislative, local, municipal or other actions adversely affecting each of Cal Am and/or Virginia American Water specifically or the water and wastewater industries generally, including with respect to the potential condemnation of Cal Am’s water system assets located on the Monterey peninsula; and (8) other economic, business and other factors.
These forward-looking statements are qualified by, and should be read together with, the risks and uncertainties set forth above and the risk factors included in the Company’s annual and quarterly reports as filed with the SEC, and readers should refer to such risks, uncertainties and risk factors in evaluating such forward-looking statements. Any forward-looking statements speak only as of the date of this Current Report on Form 8-K. The Company does not have any obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as otherwise required by the federal securities laws. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. Furthermore, it may not be possible to assess the impact of any such factor on the Company’s, Cal Am’s or Virginia American Water’s respective businesses, either viewed independently or together (in whole or in part), or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. The foregoing factors should not be construed as exhaustive.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits to this Current Report have been provided herewith as noted below:
| Exhibit No. | Description | |||||||
| 99.1* | Press Release, dated June 9, 2026, issued by Cal Am. | |||||||
| 99.2* | Press Release, dated June 9, 2026, issued by Virginia American Water. | |||||||
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are included and formatted as Inline XBRL). | |||||||
| * Filed herewith. | ||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AMERICAN WATER WORKS COMPANY, INC. | ||||||||||||||
| Dated: | June 9, 2026 | By: | /s/ DAVID M. BOWLER | |||||||||||
| David M. Bowler | ||||||||||||||
| Executive Vice President and Chief Financial Officer | ||||||||||||||
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Exhibit 99.1
California American Water Reaches Partial Settlement Agreement in General Rate Case
Sacramento, Calif. (June 9, 2026) – Yesterday, California American Water filed with the California Public Utilities Commission (CPUC) a partial settlement agreement for its statewide General Rate Case to set revenue for 2027 to 2029. The filing memorializes the settlement agreement reached with the CPUC’s Public Advocates Office. The remaining issue regarding treatment of Construction Work in Progress (CWIP) is pending.
Under the terms of the settlement, California American Water is permitted to recover additional annualized water and wastewater revenues of $24 million in test year 2027, $21 million estimated for escalation year 2028, and $22 million estimated for attrition year 2029 if CWIP remains in rate base. The 2027 increase is compared to the Company’s revised proposed increase of $43 million above 2026 expected revenues.
The settlement agreement also strengthens California American Water’s Customer Assistance Program discounts from 35 percent to 50 percent off the typical bill for qualified residential customers in Central California and continues discounts of 25 percent for qualified customers in Northern and Southern California. The settlement also authorizes the expansion of the Multi-family Assistance Payment Program pilot to qualified residents of multi-family housing in Monterey County.
California American Water will implement the new rates effective January 1, 2027, upon receiving the CPUC’s decision on the settlement agreement and the outstanding issue of CWIP treatment. While other parties are involved in this General Rate Case, the settlement announced today is with the CPUC’s Public Advocates Office. Customers in each of California American Water’s service areas will receive more information ahead of the implementation of new rates, as well as information about customer assistance and conservation programs.
Regulated water utilities like California American Water are required by law to file a General Rate Case every three years with the CPUC to set revenues and rates. The current General Rate Case was filed on July 1, 2025, reflecting approximately $750 million of ongoing water and wastewater system investments completed and planned from 2025 through 2028. The request reinforces the Company’s commitment to implementing critical system upgrades and continuing to improve water quality and reliability for its approximately 720,000 people served.
About American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility company in the United States. With a history dating back to 1886 and celebrating 140 years in 2026, We Keep Life Flowing® by providing safe, clean, reliable and affordable drinking water and wastewater services to approximately 14 million people with regulated operations in 14 states and on 18 military installations. American Water's approximately 7,000 talented professionals leverage their significant expertise and the company's national size and scale to achieve excellent outcomes for the benefit of customers, employees, investors and other stakeholders. For more information, visit amwater.com and join American Water on LinkedIn, Facebook, X and Instagram.
About California American Water
California American Water, a subsidiary of American Water with approximately 300 dedicated employees, provides safe, clean, reliable and affordable water and wastewater services to approximately 720,000 people.
California American Water, a subsidiary of American Water with approximately 300 dedicated employees, provides safe, clean, reliable and affordable water and wastewater services to approximately 720,000 people.
AWK-IR
Media Contact:
Evan Jacobs
Director, Communications & External Affairs
California and Hawaii American Water
Cell: 707-495-6135
evan.jacobs@amwater.com
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Exhibit 99.2
Virginia American Water Reaches Settlement Agreement in General Rate Case
ALEXANDRIA, VA (June 9, 2026) – On June 5, Virginia American Water filed with the Virginia State Corporation Commission (the “SCC”) a settlement agreement for its current statewide General Rate Case. The filing memorializes the settlement agreement reached with the staff of the SCC and several intervenors and remains subject to SCC review and approval.
In the General Rate Case, filed by the company on November 3, 2025, Virginia American Water sought approximately $22 million of increased annualized water and wastewater revenues. Under the terms of the settlement, the parties agreed to a $16 million annualized increase in Virginia American Water’s revenues. The annualized revenue increase is being driven primarily by approximately $115 million in ongoing capital investments completed and planned to be made between May 2025 and April 2027. The request reinforces the Company’s commitment to implementing critical system upgrades and continuing to improve water quality and reliability for its approximately 384,000 people served.
Interim rates for Virginia American Water customers became effective May 2, 2026, and will remain in place until the SCC issues its final rate order. The difference between interim and final approved rates will be refunded with interest once the final rates are determined by the SCC.
Virginia American Water wants to remind customers about its existing bill paying assistance programs, payment arrangements or budget billing options available on the customer MyWater portal at virginiaamwater.com. Income-eligible customer requirements may also apply for assistance through the company’s H2O Help to Others program, administered by Dollar Energy Fund. More information can be found at virginiaamwater.com under “Customer Service & Billing”, “Customer Assistance Programs.”
About American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility company in the United States. With a history dating back to 1886 and celebrating 140 years in 2026, We Keep Life Flowing® by providing safe, clean, reliable and affordable
drinking water and wastewater services to approximately 14 million people with regulated operations in 14 states and on 18 military installations. American Water’s approximately 7,000 talented professionals leverage their significant expertise and the company’s national size and scale to achieve excellent outcomes for the benefit of customers, employees, investors and other stakeholders. For more information, visit amwater.com and join American Water on LinkedIn, Facebook, X and Instagram.
About Virginia American Water Virginia American Water, a subsidiary of American Water, is the largest investor-owned water utility in the state, providing high-quality and reliable water services to over 384,000 people. For more information, visit www.virginiaamwater.com and follow Virginia American Water on Twitter and Facebook.
AWK-IR
Media Contact:
Marybeth Leongini
External Affairs Manager
(703) 706-3871
Marybeth.leongini@amwater.com
###
FAQ
What did American Water (AWK) announce about California-American Water’s rate case?
American Water reported a partial settlement for California-American Water’s general rate case. The settlement supports additional annualized revenues of $24 million in 2027, $21 million in 2028, and $22 million in 2029, contingent on final California Public Utilities Commission approval and treatment of construction work in progress.
How does the California settlement compare to American Water’s revised revenue request?
For test year 2027, California-American Water’s settlement revenue increase of $24 million is lower than its revised proposed increase of $43 million above expected 2026 revenues. The differences reflect negotiations with California’s Public Advocates Office and will be finalized when regulators issue their decision.
What are the key terms of Virginia American Water’s rate case settlement for AWK?
Virginia American Water’s settlement provides a $16 million annualized increase in revenues versus the original $22 million request. The agreement also sets a 9.75% return on equity and a 51.79% equity capital structure component for use in future regulatory filings, pending commission approval.
How much capital investment underpins these American Water subsidiaries’ revenue increases?
California-American Water’s requested revenue increases are tied to approximately $750 million of water and wastewater system investments from 2025 through 2028. Virginia American Water’s $16 million annualized increase is driven mainly by about $115 million of capital investments planned between May 2025 and April 2027 in its service areas.
When will new rates for California-American Water potentially take effect?
California-American Water plans to implement new rates effective January 1, 2027. This timing depends on the California Public Utilities Commission issuing a final decision on the partial settlement agreement and resolving the remaining issue regarding construction work in progress treatment in rate base.
Does the Virginia settlement include interim rates and potential customer refunds?
Interim rates for Virginia American Water customers became effective May 2, 2026, and will stay in place until the commission’s final rate order. Any difference between interim and final approved rates will be refunded to customers with interest once final rates are determined by the Virginia regulator.