Note 5 - Accumulated Other Comprehensive Income

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Comprehensive Income (Loss) Note [Text Block]

5 . Accumulated Other Comprehensive Income

The following table sets forth our changes in accumulated other comprehensive income (“AOCI”):

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2018		2017			2018			2017
	(Dollars in thousands)
Beginning balance 1	$	-	$	11,176		$	3,992		$	7,730
Adoption of accounting standards (Note 2)		-		-			(3,992	)		-
Other comprehensive income before reclassifications		-		1,778			-			6,201
Amounts reclassified from AOCI 2		-		(10,128	)		-			(11,105	)
Ending balance	$	-	$	2,826		$	-		$	2,826
Unrealized gains on available-for-sale metropolitan district bond securities 1 :
Beginning balance	$	-	$	14,825		$	-		$	14,341
Other comprehensive income (loss) before reclassifications		-		7,400			-			7,884
Amounts reclassified from AOCI		-		(22,225	)		-			(22,225	)
Ending balance	$	-	$	-		$	-		$	-
Total ending AOCI	$	-	$	2,826		$	-		$	2,826

(

1

)

All amounts net-of-tax.

(

2

)

See separate table below for details about these reclassifications.

During the

first

quarter of

2018,

an election was made to reclassify the income tax effects of the Act related to net unrealized gains on equity investments from accumulated other comprehensive income to retained earnings. See Note

2

for further discussion of adoption of new accounting standards.

The Metropolitan District Limited Tax General Obligation Capital Appreciation Bonds Series

2007

(the “Metro Bonds”) were acquired from a quasi-municipal corporation in the state of Colorado, which was formed to help fund and maintain the infrastructure associated with a master-planned community developed by our Company. During the

2017

third

quarter, we sold the Metro Bonds for net proceeds of

$44.3

million. With a cost basis of

$8.4

million, we recorded a realized gain of

$35.8

million, which is included in interest and other income in the homebuilding section of our consolidated statements of operations and comprehensive income for the

three

and

nine

months ended

September 30, 2017.

The following table sets forth the activity, including the Metro Bonds discussed above, related to reclassifications out of accumulated other comprehensive income:

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
Affected Line Item in the Statements of Operations	2018		2017			2018		2017
	(Dollars in thousands)
Homebuilding: Interest and other income	$	-	$	52,211		$	-	$	53,622
Homebuilding: Other-than-temporary impairment of marketable securities		-		-			-		(51	)
Financial services: Interest and other income		-		-			-		347
Financial services: Other-than-temporary impairment of marketable securities		-		(29	)		-		(160	)
Income before income taxes		-		52,182			-		53,758
Provision for income taxes		-		(19,829	)		-		(20,428	)
Net income	$	-	$	32,353		$	-	$	33,330