Operating Revenues

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Operating revenues by solution type consist of the following:



(in thousands)	PIRM		UWS		Corporate and Eliminations			Consolidated
For the Three Months Ended March 31, 2020	PIRM		UWS		Corporate and Eliminations			Consolidated
Property insights	$	116,977	$	—	$	—		$	116,977
Insurance and spatial solutions	46,840		—		—			46,840
Flood data solutions	—		27,603		—			27,603
Valuation solutions	—		61,247		—			61,247
Credit solutions	—		81,127		—			81,127
Property tax solutions	—		101,991		—			101,991
Other	9,238		3,653		(4,791		)	8,100
Total operating revenue	$	173,055	$	275,621	$	(4,791	)	$	443,885

For the Three Months Ended March 31, 2019
Property insights	$	118,670	$	—	$	—		$	118,670
Insurance and spatial solutions	45,416		—		—			45,416
Flood data solutions	—		16,976		—			16,976
Valuation solutions	—		66,323		—			66,323
Credit solutions	—		67,814		—			67,814
Property tax solutions	—		86,582		—			86,582
Other	11,722		6,823		(2,618		)	15,927
Total operating revenue	$	175,808	$	244,518	$	(2,618	)	$	417,708

Property Insights

Our property insights solutions combine our patented predictive analytics with our proprietary and contributed data to enable our clients to improve customer acquisition and retention, detect and prevent fraud, improve mortgage transaction cycle time and cost efficiency, identify real estate trends and neighborhood characteristics, track market performance, and increase market share. Our data is comprised of real estate information, incorporating crime, site inspection, neighborhood, document images, and other information from proprietary sources. We also offer verification of applicant income, identity and employment services. We typically license data in one of two forms: bulk data licensing and transactional licensing. Operating revenue for bulk data licensing contracts that provide a stand-ready obligation or include substantive updates to the intellectual property is recognized ratably over the contractual term; otherwise, operating revenue is recognized upon delivery. For transactional licensing, we recognize operating revenue based on usage.

Insurance and Spatial Solutions

Our insurance and spatial solutions provide originators and property and casualty insurers the ability to more effectively locate, assess and manage property-level assets and risks through location-based data and analytics. We also provide cloud-based property claims workflow technology for property and casualty insurers. The licensed intellectual property data is generally provided to our clients on a subscription or usage basis. For subscription contracts, operating revenue is recognized ratably over the contractual term once initial delivery has occurred. For contracts to provide a license to data which is delivered via report or data file, operating revenue is recognized when the client obtains control of the products, which is upon delivery.

Property Tax Solutions

Our property tax solutions are built from aggregated property tax information from over 20,000 taxing authorities. We use this information to advise mortgage lenders and servicers of the property tax payment status of loans in their portfolio and to monitor that status over the life of the loans. If a mortgage lender or servicer requires tax payments to be impounded on behalf of its borrowers, we can also facilitate the transfer of these funds to the taxing authorities and provide the lender or servicer with payment confirmation. Property tax processing revenues are primarily comprised of periodic loan fees and life-of-loan fees. For periodic fee arrangements, we generate monthly fees at a contracted rate for as long as we service the loan. For life-

of-loan fee arrangements, we charge a one-time fee when the loan is set-up in our tax servicing system. Life-of-loan fees are deferred and recognized ratably over the expected service period of 10 years and adjusted for early loan cancellation. Revenue recognition rates of loan portfolios are regularly analyzed and adjusted monthly to reflect current trends.

Valuation Solutions

Our valuation solutions represent property valuation-related data driven services and analytics combined with collateral valuation workflow technologies which assist our clients in assessing risk of loss using both traditional and alternative forms of property valuation, driving process efficiencies as well as ensuring compliance with lender and governmental regulations. We provide collateral information technology and solutions that automate property appraisal ordering, tracking, documentation and review for lender compliance with government regulations. Revenue for the property appraisal service is recognized when the appraisal service is performed and delivered to the client. In addition, to the extent that we provide continuous access to the hosted software platform, we recognize operating revenue over the term of the arrangement.

Credit Solutions

Our credit solutions provide credit and income verification services to the mortgage and automotive industries. We provide comprehensive information, typically in the form of a report, about credit history, income verification, employment verification, and home address history. We normalize the data to provide a broad range of advanced business information solutions designed to reduce risk and improve business performance to mortgage and automotive lenders. Operating revenue is recognized when the report or information is delivered to the client.

Flood Data Solutions

Our flood data solutions provide flood zone determinations primarily to mortgage lenders in accordance with US Federal legislation passed in 1994, which requires that most lenders obtain a determination of the current flood zone status at the time each loan is originated and obtain applicable updates during the life of the loan if contracted to do so. We also provide flood zone determinations to insurance companies. We generally recognize operating revenue upon delivery of the initial determination. If contracted for life of loan monitoring, we recognize operating revenue over the estimated service period, as adjusted for early loan cancellation.

Contract Costs

Incremental costs to obtain or fulfill client contracts are recognized as an asset. As of March 31, 2020, we had $10.3 million of current deferred contract costs which are presented in prepaid expenses and other current assets, as well as $23.2 million of long-term deferred contract costs which are presented in other assets in our condensed consolidated balance sheet. As of December 31, 2019, we had $9.8 million of current deferred contract costs and $23.1 million of long-term deferred contract costs. Our deferred contract costs primarily include certain set-up and acquisition costs related to property tax solutions, which amortize ratably over an expected 10-year life, adjusted for early loan cancellations. For the three months ended March 31, 2020 and 2019, we recorded amortization associated with deferred contract costs of $3.7 million and $3.1 million, respectively.

Contract Liabilities

We record a contract liability when amounts are invoiced, which is generally prior to the satisfaction of the performance obligation. For property tax solutions, we invoice upfront fees to clients for services to be performed over time. For property insights and insurance and spatial solutions we invoice quarterly and annually, commencing upon execution of the contracts or at the beginning of the license term, as applicable.

As of March 31, 2020, we had $910.0 million in contract liabilities compared to $884.9 million as of December 31, 2019. The overall change of $25.1 million in contract liability balances are primarily due to $173.4 million of new deferred billings in the current year, partially offset by $147.1 million of operating revenue recognized, of which $100.2 million related to contracts previously deferred, and other decreases of $1.2 million.

Remaining Performance Obligations

The majority of our arrangements are between one and three years with a significant portion being one year or less. For the remaining population of non-cancellable and fixed arrangements greater than one year, as of March 31, 2020 we had $1.0 billion of remaining performance obligations. We expect to recognize approximately 26% percent of this remaining revenue backlog in 2020, 26% in 2021, 17% in 2022 and 31% thereafter. See further discussion of performance obligations in Note 1 - Basis for Condensed Consolidated Financial Statements.