Receivables, Net



(in thousands)	June 30, 2011		December 31, 2010		June 30, 2010
Construction contracts:
Completed and in progress	$	155,807	$	121,664	$	155,343
Retentions	79,598		96,333		88,973
Total construction contracts	235,405		217,997		244,316
Construction material sales	39,074		17,674		39,989
Other	12,605		11,612		15,106
Total gross receivables	287,084		247,283		299,411
Less: allowance for doubtful accounts	3,140		3,297		3,632
Total net receivables	$	283,944	$	243,986	$	295,779

Included in other receivables at June 30, 2011, December 31, 2010 and June 30, 2010 were items such as notes receivable, interest receivable, fuel tax refunds and income tax refunds. No such receivables individually exceeded 10% of total net receivables at any of these dates.

Financing receivables consisted of long-term notes receivable and retentions receivable. As of June 30, 2011, December 31, 2010 and June 30, 2010, long-term notes receivable outstanding were $2.1 million, $1.8 million and $3.0 million, respectively, and primarily related to loans made to employees or unconsolidated affiliates and were included in other noncurrent assets on our condensed consolidated balance sheets.

We segregate our retention receivables into two categories: escrow and non-escrow and the balances in each category were as follows:



(in thousands)	June 30, 2011		December 31, 2010		June 30, 2010
Escrow	$	38,366	$	43,841	$	39,336
Non-escrow	41,232		52,492		49,637
Total retention receivables	$	79,598	$	96,333	$	88,973

The escrow receivables include amounts due to Granite which have been deposited into an escrow account and bear interest. Typically, escrow retention receivables are held until work on a project is complete and has been accepted by the owner who then releases those funds, along with accrued interest, to us. There is minimal risk of not collecting on these amounts.

Non-escrow retention receivables are amounts that the project owner has contractually withheld that will be paid upon owner acceptance of contract completion. We evaluate our non-escrow retention receivables using certain customer information that includes the following:


•	Federal - includes federal agencies such as the Bureau of Reclamation, the Army Corp of Engineers, and the Bureau of Indian Affairs. The obligations of these agencies are backed by the federal government. Consequently there is minimal risk of not collecting the amounts we are entitled to receive.


•	State - primarily state departments of transportation. The risk of not collecting on these accounts is small; however, we have experienced occasional delays in payment as states have struggled with budget issues.


•	Local - these customers include local agencies such as cities, counties and other local municipal agencies. The risk of not collecting on these accounts is small; however, we have experienced occasional delays in payment as some local agencies have struggled to deal with budget issues.

•

Private - includes individuals, developers and corporations. The majority of our collection risk is associated with these customers. We perform ongoing credit evaluations of our customers and generally do not require collateral, although the law provides us certain remedies, including, but not limited to, the ability to file mechanics’ liens on real property improved for private customers in the event of non-payment by such customers.

The following table summarizes the amount of our non-escrow retention receivables within each category:



(in thousands)	June 30, 2011		December 31, 2010		June 30, 2010
Federal	$	3,421	$	3,080	$	1,471
State	7,928		9,507		11,541
Local	20,282		29,451		25,668
Private	9,601		10,454		10,957
Total	$	41,232	$	52,492	$	49,637

We regularly review our accounts receivable, including past due amounts, to determine their probability of collection. If it is probable that an amount is uncollectible, it is charged to bad debt expense and a corresponding reserve is established in allowance for doubtful accounts. If it is deemed certain that an amount is uncollectible, the amount is written off. Based on contract terms, non-escrow retention receivables are typically due within 60 days of owner acceptance of contract completion. We consider retention amounts beyond 60 days of owner acceptance of contract completion to be past due. The following tables present the aging of our non-escrow retention receivables (in thousands):



June 30, 2011	Current		0 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	3,025	$	—	$	396	$	3,421
State	6,951		29		948		7,928
Local	16,294		1,432		2,556		20,282
Private	9,028		222		351		9,601
Total	$	35,298	$	1,683	$	4,251	$	41,232



December 31, 2010	Current		0 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	2,587	$	174	$	319	$	3,080
State	4,443		628		4,436		9,507
Local	22,641		2,800		4,010		29,451
Private	9,243		175		1,036		10,454
Total	$	38,914	$	3,777	$	9,801	$	52,492



June 30, 2010	Current		0 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	738	$	311	$	422	$	1,471
State	9,472		544		1,525		11,541
Local	20,874		1,463		3,331		25,668
Private	9,537		465		955		10,957
Total	$	40,621	$	2,783	$	6,233	$	49,637

Federal, state and local agencies generally require several approvals to release payments, and these approvals often take over 90 days past contractual due dates to obtain. Amounts past due from government agencies primarily result from delays caused by paperwork processing and obtaining proper agency approvals rather than lack of funds. As of June 30, 2011, December 31, 2010 and June 30, 2010 our allowance for doubtful accounts contained no material provision related to non-escrow retention receivables as we determined there were no significant collectibility issues.