Global Water Resources Inc

ITEM 1A. Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Risk Factors included in Part I, Item 1A of the 2024 Form 10-K. There have been no material changes to such risk factors. , other than as set forth below:

Our ability to expand into new service areas and to expand current water and wastewater service depends on approval from regulatory agencies. Failure to obtain required regulatory approvals will adversely affect future growth.

In Arizona, the ACC is the regulatory authority that oversees the formation, expansion and ongoing operations of water and wastewater utilities. The ACC has authority, among other things, to determine service areas for utility providers. In order for our owned utilities to provide water or wastewater service, they must obtain a CCN for a service area before they can service that area. In addition, our owned utilities and/or the developments that we serve must demonstrate to the ADWR that there exists a 100-year water supply and obtain either a CAWS, which is a certificate issued by the ADWR evidencing sufficient groundwater, surface water, or effluent of adequate quality will be continuously available to satisfy the water needs of the proposed use for at least one hundred years and which applies to a specific subdivision, or a DAWS, which applies to the utilitys entire service area. The designation area is generally coterminous with the CCN and can grow into adjacent areas as needed. Further, our wastewater facilities require ADEQ and/or EPA permits that regulate, among other things, the level of discharges from our facilities, the size of our facilities and the location of our facilities. Any inability to obtain the necessary regulatory approvals, assured water supplies or environmental permits would limit our ability to expand our water or wastewater service areas.

In particular, water resource constraints exist in certain areas within Pinal County near and around the City of Maricopa. We have obtained two DAWS in the Maricopa/Casa Grande service area (GW-Santa Cruz) for approximately 22,900 acre-feet of water use in total. We have significant unused capacity provided by the large DAWS in the north, including the incorporated City of Maricopa. In Pinal County, southwest of the City of Maricopa, growth covered by the smaller DAWS is more constrained by state law and groundwater regulations, which may impact developers ability to obtain final plat approval if the DAWS is not expanded. While we believe we have sufficient capacity for many years to support connection growth in this area, it is the increase in land entitlement that may exceed the allocation of the smaller DAWS, which in turn may limit future plat approvals. We are working with our development partners and others to develop long-term solutions for this area. See Managements Discussion and Analysis of Financial Condition and Results of OperationsFactors Affecting our Results of OperationsAccess to and Quality of Water Supply, included in Part I, Item 2 of this report.

In addition, if we chose to expand to states other than Arizona, we may have difficulty acquiring the necessary approvals and permits or complying with environmental, health and safety or quality standards of such states. See Risk FactorsBusiness and Operational Factors Doing business in jurisdictions other than Arizona may present unforeseen regulatory, legal and operational challenges that could impede or delay our operations or adversely affect our profitability, included in Part I, Item 1A of the 2024 Form 10-K