Derivative and Hedging

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative and Hedging

Derivatives and Hedging

The Company's interest rate swaps are pay-fixed (1.16%), receive-variable (one month LIBOR) that hedged approximately 41% of outstanding debt with outstanding notional amounts totaling $289.4 million and $339.8 million December 31, 2020 and 2019, respectively.

The fair value of these instruments was estimated using an income approach and observable market inputs. The hedge was determined to be highly effective and therefore all of the change in its fair value was recognized through other comprehensive income. Derivative balances are presented as follows in our consolidated balance sheet:

(in thousands)	December 31, 2020		December 31, 2019
Balance sheet location of derivative financial instruments:
Prepaid expenses and other	$	—	$	1,382
Deferred charges and other assets	—		1,252
Accrued liabilities and other	4,048		—
Total derivatives designated as hedging instruments	$	4,048	$	2,634

Market expectations of the projected LIBOR decreased significantly during 2020, which drove the fair value of our interest rate swaps to a liability.

The table below summarizes changes in accumulated other comprehensive income (loss) by component:

(in thousands)	Gains (Losses) on Cash Flow Hedges		Income Tax (Expense) Benefit		Accumulated Other Comprehensive Income (Loss), net of taxes
Balance as of December 31, 2019	$	2,634	$	(2,326)	$	308
Net change in unrealized (loss) gain	(8,444)		2,806		(5,638)
Amounts reclassified from accumulated other comprehensive income (loss) to interest expense	1,762		(1,138)		624
Net current period other comprehensive (loss) income	(6,682)		1,668		(5,014)
Balance as of December 31, 2020	$	(4,048)	$	(658)	$	(4,706)

As of December 31, 2020, the Company estimates that $3.2 million will be reclassified as a reduction of interest expense during the next twelve months.