Income Taxes

12 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

Income Taxes

10.   Income Taxes

The Company recorded income tax expense in the current year of $439,000 as compared to income tax benefit of $4,638,000 in 2010 and income tax expense of $7,493,000 in 2009.

Income tax expense (benefit) from operations:

	Year Ended September 30,
	2011			2010			2009
Current federal	$	(3,167,000	)	$	(7,342,000	)	$	3,770,000
Current state		238,000			240,000			1,423,000
Deferred federal		3,920,000			2,817,000			1,921,000
Deferred state		(552,000	)		(353,000	)		379,000
Total	$	439,000		$	(4,638,000	)	$	7,493,000

The income tax provision differs from the amount computed by applying the statutory federal income tax rate to (losses) income from continuing operations before income taxes as follows:

	Year Ended September 30,
	2011			2010			2009
Tax (benefit) expense computed at statutory rate of 35%	$	(982,000	)	$	(4,896,000	)	$	6,200,000
Change in valuation allowance		(19,000	)		(39,000	)		(12,000	)
State income tax (benefit) expense		(284,000	)		(82,000	)		1,089,000
Transaction costs (not deductible for tax purposes)		1,353,000			—			—
Other		371,000			379,000			216,000
Income tax expense (benefit)	$	439,000		$	(4,638,000	)	$	7,493,000

The principal components of the Company’s net deferred tax liability are as follows:

	September 30,
	2011			2010
Deferred tax assets:
Receivables	$	550,000		$	129,000
Restricted stock		258,000			802,000
Workers’ compensation		331,000			368,000
State tax net operating loss (NOL) carry forward		853,000			484,000
Federal tax NOL carry forward		13,625,000			—
Self insurance		298,000			251,000
AMT credit carry forward		177,000			—
Other		262,000			329,000
Total gross deferred tax assets		16,354,000			2,363,000
Less valuation allowance		—			(19,000	)
Total net deferred tax assets		16,354,000			2,344,000
Deferred tax liabilities:
Property and equipment		(37,194,000	)		(19,363,000	)
Other		—			(2,000	)
Total gross deferred tax liabilities		(37,194,000	)		(19,365,000	)
Net deferred tax liability	$	(20,840,000	)	$	(17,021,000	)
Current portion of net deferred tax asset/liability	$	1,236,000		$	1,764,000
Non-current portion of net deferred tax asset/liability		(22,076,000	)		(18,785,000	)
Total net deferred tax liability	$	(20,840,000	)	$	(17,021,000	)

At September 30, 2011, the Company had a gross NOL for U.S. federal and state income tax purposes of approximately $48,589,000. This NOL expires in 2031. The Company intends to carryback a portion of the federal NOL for two years to offset against prior taxable income. The Company will then carry forward the remaining net federal NOL of approximately $13,625,000. The Company also had net state NOLs that will affect state taxes of approximately $853,000 at September 30, 2011. State NOLs will begin to expire in 2015. Carryback provisions are not allowed by states, so the entire state NOLs give rise to a deferred tax asset. The Company believes, based on past levels of income, it is more likely than not that the results of future operations will generate sufficient taxable income in which to realize these deferred tax assets. As such, no valuation allowance was considered necessary related to the federal or state NOLs.

At September 30, 2011, the Company released all of the valuation allowance held at September 30, 2010 related to the Company’s deferred tax assets for capital loss carry forwards. The Company has no valuation allowances as of September 30, 2011.

The following presents a roll forward of the Company’s unrecognized tax benefits:

	September 30,
	2011			2010
Balance at beginning of fiscal year	$	235,000		$	416,000
Expiration of statutes of limitations		(74,000	)		(181,000	)
Balance at end of fiscal year	$	161,000		$	235,000

As of September 30, 2011, the Company recognized $259,000 of liabilities for unrecognized tax benefits of which $98,000 related to penalties and interest. The Company expects all of the liabilities for unrecognized tax benefits to settle or lapse in the statutes of limitations by September 30, 2012. The Company did not record any changes in prior year tax positions, current year tax positions or settlements with taxing authorities related to uncertain tax positions during fiscal 2011 or 2010.

The tax years generally subject to future examination by tax authorities are for years ended September 30, 2007 and after. While it is expected that the amount of unrecognized tax benefits will change in the next twelve months, the Company does not expect any change to have a significant impact on its results of operations. The recognition of the total amount of unrecognized tax benefits of $259,000 would have an impact on the effective tax rate.

The Company’s continuing practice is to recognize interest and penalties related to unrecognized tax benefits in income tax expense. In fiscal years 2011 and 2010, the Company’s net accrued interest and penalties decreased by approximately $11,000 and $54,000, respectively.