During the second quarter of 2018, Frontier announced a multi-year strategic plan with the objective of improving revenues, profitability, and cash flows by enhancing our operations and customer service and support processes. During the three and nine months ended September 30, 2019, we incurred $9 million and $38 million, respectively, in costs directly associated with these activities.

We had retained a consulting firm to assist in executing on various aspects of the transformation program. This agreement was terminated in June 2019 and in connection therewith we made a payment in the third quarter of approximately $30 million of previously accrued expenses. We continue to pursue a reduced transformation program and expect associated expenses to be recognized as incurred. Amounts accrued in connection with the consulting arrangement are recognized as operating expense under “Restructuring costs and other charges.”

Restructuring costs and other charges, consisting primarily of severance and other employee-related costs of $29 million and costs directly associated with the transformation program of $38 million, are included in “Restructuring costs and other charges” in our consolidated statement of operations for the nine months ended September 30, 2019.

For the nine months ended September 30, 2018, restructuring costs and other charges, consisted primarily of severance and other employee-related costs of $11 million.

The following is a summary of the changes in the liabilities established for restructuring and other programs for the nine months ended September 30, 2019 which are all classified in other current liabilities:



($ in millions)

Balance at January 1, 2019	$	18
Severance expense		29
Transformation costs		38
Other restructuring costs		19
Cash payments during the period		(95)
Balance at September 30, 2019	$	9