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INCOME TAXES (Tables)

9 Months Ended

Sep. 30, 2011

Effective Tax Rate Reconciliation (Percent)

The following table accounts for the difference between the actual tax provision and the amounts obtained by applying the statutory U.S. federal income tax rate of 35% to income before taxes.

	Three Months Ended September 30,						Nine Months Ended September 30,
Effective Tax Rate Reconciliation (Percent)	2011			2010			2011			2010
Statutory federal tax rate		35.0	%		35.0	%		35.0	%		35.0	%
Foreign rate differential		(0.1	)		(0.6	)		—			(0.4	)
Domestic manufacturing/export tax incentive		(1.6	)		0.8			(0.8	)		—
Dividends paid to CEOP		(0.4	)		(1.0	)		(0.2	)		(1.4	)
State income taxes, net		2.4			2.0			1.2			1.7
Change in tax contingencies		(5.2	)		(16.1	)		(1.0	)		(11.4	)
Change in valuation allowance		—			0.3			—			(1.6	)
Return to provision		2.0			(2.6	)		0.6			(1.9	)
Remeasurement of deferred taxes		—			—			(1.4	)		—
Incremental tax effect of SunBelt remeasurement		—			—			3.5			—
Other, net		(0.1	)		0.2			(0.1	)		0.7
Effective tax rate		32.0	%		18.0	%		36.8	%		20.7	%

Unrecognized Tax Benefits

As of September 30, 2011, we had $38.7 million of gross unrecognized tax benefits, which would have a net $36.6 million impact on the effective tax rate, if recognized. As of September 30, 2010, we had $42.4 million of gross unrecognized tax benefits, of which $40.1 million would have impacted the effective tax rate, if recognized. The reduction for 2011 primarily relates to the recognition of tax benefits due to the expiration of statute of limitations in domestic jurisdictions. The reduction included $2.1 million of tax positions associated with discontinued operations. The amount of unrecognized tax benefits was as follows:

	September 30,
	2011			2010
	($ in millions)
Balance at beginning of year	$	41.5		$	50.8
Increases for prior year tax positions		0.2			0.2
Decreases for prior year tax positions		—			(0.3	)
Increases for current year tax positions		—			1.8
Decreases for current year tax positions		—			(0.1	)
Decreases due to settlement with taxing authorities		—			(2.2	)
Reductions due to statute of limitations		(3.0	)		(7.8	)
Balance at end of period	$	38.7		$	42.4

Tax Returns Subject to Examination

We operate primarily in North America and file income tax returns in numerous jurisdictions. Our tax returns are subject to examination by various federal, state and local tax authorities. For our primary tax jurisdictions, the tax years that remain subject to examination are as follows:

	Tax Years
U.S. federal income tax	2007 – 2010
U.S. state income tax	2004 – 2010
Canadian federal income tax	2007 – 2010
Canadian provincial income tax	2006 – 2010

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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- Definition

Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded.

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