Receivables, net



(in thousands)	March 31, 2012		December 31, 2011		March 31, 2011
Construction contracts:
Completed and in progress	$	101,659	$	122,987	$	69,095
Retentions	70,071		77,038		77,523
Total construction contracts	171,730		200,025		146,618
Construction material sales	26,959		30,356		13,964
Other	12,837		24,337		13,024
Total gross receivables	211,526		254,718		173,606
Less: allowance for doubtful accounts	2,819		2,880		3,165
Total net receivables	$	208,707	$	251,838	$	170,441

Receivables include amounts billed and billable for public and private contracts and do not bear interest. The balances billed but not paid by customers pursuant to retainage provisions in construction contracts generally become due upon completion and acceptance of the contract by the owners. Included in other receivables at March 31, 2012, December 31, 2011 and March 31, 2011 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 March 31, 2012, December 31, 2011 and March 31, 2011, long-term notes receivable outstanding were $2.0 million for each year and primarily related to loans made to employees and were included in other noncurrent assets in our condensed consolidated balance sheets.

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



(in thousands)	March 31, 2012		December 31, 2011		March 31, 2011
Escrow	$	46,430	$	43,378	$	34,945
Non-escrow	23,641		33,660		42,578
Total retention receivables	$	70,071	$	77,038	$	77,523

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 for collectability 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)	March 31, 2012		December 31, 2011		March 31, 2011
Federal	$	2,306	$	2,811	$	3,587
State	4,342		5,453		7,994
Local	10,827		14,708		21,476
Private	6,166		10,688		9,521
Total	$	23,641	$	33,660	$	42,578

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):



March 31, 2012	Current		1 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	1,169	$	1,078	$	59	$	2,306
State	2,490		795		1,057		4,342
Local	4,915		3,720		2,192		10,827
Private	5,167		674		325		6,166
Total	$	13,741	$	6,267	$	3,633	$	23,641



December 31, 2011	Current		1 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	2,462	$	326	$	23	$	2,811
State	2,751		860		1,842		5,453
Local	12,313		1,326		1,069		14,708
Private	9,599		765		324		10,688
Total	$	27,125	$	3,277	$	3,258	$	33,660



March 31, 2011	Current		1 - 90 Days Past Due		Over 90 Days Past Due		Total
Federal	$	2,690	$	666	$	231	$	3,587
State	6,177		600		1,217		7,994
Local	16,698		2,426		2,352		21,476
Private	8,783		315		423		9,521
Total	$	34,348	$	4,007	$	4,223	$	42,578

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 March 31, 2012, December 31, 2011 and March 31, 2011, our allowance for doubtful accounts contained no material provision related to non-escrow retention receivables as we determined there were no significant collectibility issues.