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Fair Value Measurements
 6 Months Ended
Jun. 30, 2023
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Note 9—Fair Value Measurements

The Company’s current assets and current liabilities are financial instruments and most of these items (other than marketable securities, inventories and the short-term portion of deferred compensation funding) are recorded at cost in the Consolidated Balance Sheets. The estimated fair value of these financial instruments approximates their carrying value due to their short-term nature. The carrying value of the Company’s line of credit represents the outstanding amount of the borrowings, which approximates fair value. The Company’s financial assets that are measured at fair value on a recurring basis are its marketable securities and deferred compensation funding. The recorded values of all of the financial instruments approximate their current fair values because of their nature, stated interest rates and respective maturity dates or durations.

The Company’s marketable securities are held by the Company’s captive insurance company to satisfy capital requirements of the state regulator related to captive insurance companies. Such securities primarily consist of tax-exempt municipal bonds, which are classified as available-for-sale and are reported at fair value. Unrealized gains and losses associated with these investments are included in “Unrealized (loss) gain on available-for-sale marketable securities, net of taxes” within the Consolidated Statements of Comprehensive Income. The fair value of these marketable securities is classified within Level 2 of the fair value hierarchy, as these securities are measured using quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable. Such valuations are determined by a third-party pricing service. For the three and six months ended June 30, 2023, the Company recorded unrealized losses, net of taxes of $0.9 million and unrealized gains, net of taxes of $0.3 million on marketable securities, respectively. For the three and six months ended June 30, 2022, the Company recorded unrealized losses, net of taxes of $1.9 million and $7.2 million, respectively.

As part of a prior year acquisition of a prepackaged meal manufacturer, the Company agreed to pay royalties to the seller on all future product sales. The Company recorded a liability for the expected future payments within “Other long-term liabilities” on the Consolidated Balance Sheets and any payments within 12 months within “Other accrued expenses and current liabilities”. The fair value of this liability is measured using forecasted sales models (Level 3). For the three months ended June 30, 2023 and 2022, the Company recorded realized gains of $0.6 million and gains of $0.2 million, respectively, associated with changes in fair value of the liability. Gains and losses are recorded within “Costs of services provided” in the Consolidated Statements of Comprehensive Income related to the subsequent measurement of the liability. For the six months ended June 30, 2023 and 2022, the Company recorded realized gains of $0.2 million and $1.9 million, respectively, within “Costs of services provided” in the Consolidated Statements of Comprehensive Income related to the subsequent measurement of the liability at each period end.
For the three months ended June 30, 2023 and 2022, the Company received total proceeds, less the amount of interest received, of $1.2 million and $8.0 million, respectively, from sales of available-for-sale municipal bonds. For both the three months ended June 30, 2023 and 2022, these sales resulted in realized losses of less than $0.1 million. For the six months ended June 30, 2023 and 2022, the Company received total proceeds, less the amount of interest received, of $1.4 million and $9.5 million, respectively, from sales of available-for-sale municipal bonds. For both the six months ended June 30, 2023 and 2022, these sales resulted in realized losses of less than $0.1 million, which were recorded within “Investment and other income (loss), net” in the Consolidated Statements of Comprehensive Income. The basis for the sale of these securities was the specific identification of each bond sold during the period.

The investments under the funded deferred compensation plan are classified as trading securities and unrealized gains or losses are recorded in “Selling, general and administrative expense” in the Consolidated Statements of Comprehensive Income. The fair value of these investments are determined based on quoted market prices (Level 1). For the three months ended June 30, 2023 and 2022, the Company recognized unrealized gains of $2.3 million and unrealized losses of $6.5 million, respectively, related to equity securities still held at the respective reporting dates. For the six months ended June 30, 2023 and 2022, the Company recognized unrealized gains of $3.8 million and unrealized losses of $10.6 million, respectively, related to equity securities still held at the respective reporting dates.

The following tables provide fair value measurement information for the Company’s marketable securities and deferred compensation fund investments as of June 30, 2023 and December 31, 2022:

As of June 30, 2023
Fair Value Measurement Using:
Carrying AmountTotal Fair ValueQuoted Prices in Active Markets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Financial Assets:
Marketable securities
Municipal bonds — available-for-sale$93,185 $93,185 $— $93,185 $— 
Deferred compensation fund
Money Market1
$2,005 $2,005 $— $2,005 $— 
Commodities235 235 235 — — 
Fixed Income4,023 4,023 4,023 — — 
International4,096 4,096 4,096 — — 
Large Cap Blend2,114 2,114 2,114 — — 
Large Cap Growth13,022 13,022 13,022 — — 
Large Cap Value6,134 6,134 6,134 — — 
Mid Cap Blend2,682 2,682 2,682 — — 
Real Estate335 335 335 — — 
Small Cap Blend3,809 3,809 3,809 — — 
Deferred compensation fund2
$38,455 $38,455 $36,450 $2,005 $— 
As of December 31, 2022
Fair Value Measurement Using:
Carrying
Amount		Total Fair
Value		Quoted Prices in Active Markets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Financial Assets:
Marketable securities
Municipal bonds — available-for-sale$95,200 $95,200 $— $95,200 $— 
Deferred compensation fund
Money Market1
$2,420 $2,420 $— $2,420 $— 
Commodities170 170 170 — — 
Fixed Income3,571 3,571 3,571 — — 
International4,093 4,093 4,093 — — 
Large Cap Blend1,210 1,210 1,210 — — 
Large Cap Growth11,064 11,064 11,064 — — 
Large Cap Value6,133 6,133 6,133 — — 
Mid Cap Blend2,667 2,667 2,667 — — 
Real Estate359 359 359 — — 
Small Cap Blend3,424 3,424 3,424 — — 
Deferred compensation fund2
$35,111 $35,111 $32,691 $2,420 $— 
1.The fair value of the money market fund is based on the net asset value (“NAV”) of the shares held by the plan at the end of the period. The money market fund includes short-term United States dollar denominated money market instruments and the NAV is determined by the custodian of the fund. The money market fund can be redeemed at its NAV at the measurement date as there are no significant restrictions on the ability to sell this investment.
2.As of June 30, 2023 and December 31, 2022, $1.4 million and $1.6 million of short-term deferred compensation funding is included in “Prepaid expenses and other assets” on the Company’s Consolidated Balance Sheets, respectively. Such amounts of short-term deferred compensation funding represent investments expected to be liquidated and paid within 12 months of June 30, 2023.

Amortized CostGross Unrealized GainsGross Unrealized LossesEstimated Fair Value
Credit Impairment Losses1
(in thousands)
June 30, 2023
Type of security:
Municipal bonds — available-for-sale$97,147 $194 $(4,156)$93,185 $— 
Total debt securities$97,147 $194 $(4,156)$93,185 $— 
December 31, 2022
Type of security:
Municipal bonds — available-for-sale$99,601 $229 $(4,630)$95,200 $— 
Total debt securities$99,601 $229 $(4,630)$95,200 $— 
1.The Company performs a credit impairment loss assessment quarterly on an individual security basis. As of June 30, 2023 and December 31, 2022, no allowance for credit loss impairment has been recognized as the issuers of these securities have not established a cause for default and various rating agencies have reaffirmed each security's investment grade status. The fair value of these securities have fluctuated since the purchase date as market interest rates fluctuate. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell before the recovery of the securities’ amortized cost basis.
The following table summarizes the contractual maturities of debt securities held at June 30, 2023 and December 31, 2022, which are classified as “Marketable securities, at fair value” in the Consolidated Balance Sheets:
Municipal Bonds — Available-for-Sale
Contractual maturity:June 30, 2023December 31, 2022
(in thousands)
Maturing in one year or less$5,723 $2,798 
Maturing in second year through fifth year32,436 35,068 
Maturing in sixth year through tenth year39,265 38,575 
Maturing after ten years15,761 18,759 
Total debt securities$93,185 $95,200