Asset retirement obligations (AROs) are legal obligations associated with the retirement of long-lived assets resulting from the acquisition, construction, development and/or normal use of the underlying assets. Recognition of a liability for an ARO is required in the period in which it is incurred at its estimated fair value. The associated asset retirement costs are capitalized as part of the carrying amount of the underlying asset and depreciated over the estimated useful life of the asset. The liability is accreted through charges to operating expenses. If the ARO is settled for an amount other than the carrying amount of the liability, we recognize a gain or loss on settlement.

We record all AROs for which we have legal obligations for land reclamation at estimated fair value. These AROs relate to our underlying land parcels, including both owned properties and mineral leases. For the years ended December 31, we recognized ARO operating costs related to accretion of the liabilities and depreciation of the assets as follows:



in thousands	2020	2019	2018
ARO Operating Costs
Accretion	$ 12,432	$ 10,992	$ 10,776
Depreciation	8,592	7,075	6,034
Total	$ 21,024	$ 18,067	$ 16,810

ARO operating costs are reported in cost of revenues. AROs are reported within other noncurrent liabilities in our accompanying Consolidated Balance Sheets.

Reconciliations of the carrying amounts of our AROs for the years ended December 31 are as follows:



in thousands	2020	2019
Asset Retirement Obligations
Balance at beginning of year	$ 210,323	$ 225,726
Liabilities incurred	353	263
Liabilities settled	(12,820)	(12,457)
Accretion expense	12,432	10,992
Revisions, net	72,875	(14,201)
Balance at end of year	$ 283,163	$ 210,323

ARO liabilities settled during 2020 and 2019 include $2,563,000 and $3,354,000, respectively, of reclamation activities required under a development agreement and conditional use permits at two adjacent aggregates sites on owned property in Southern California. The reclamation required under the development agreement will result in the restoration of 90 acres of previously mined property to conditions suitable for commercial and retail development.

ARO revisions during 2020 primarily include increases in estimated costs at two aggregates locations, including reclamation activities required under a development agreement at an aggregates site on owned property in Southern California. The reclamation required under the development agreement will result in the restoration of previously mined property to conditions suitable for retail and commercial development.