Legal and Administrative Proceedings. The Company is engaged in certain legal and administrative proceedings incidental to its normal business activities. In the opinion of management and counsel, based upon currently-available facts, the likelihood is remote that the ultimate outcome of any litigation and other proceedings, including those pertaining to environmental matters (see Note A), relating to the Company and its subsidiaries, will have a material adverse effect on the overall results of the Company’s operations, its cash flows or its financial position.

Asset Retirement Obligations. The Company incurs reclamation and teardown costs as part of its mining and production processes. Estimated future obligations are discounted to their present value and accreted to their projected future obligations via charges to operating expenses. Additionally, the fixed assets recorded concurrently with the liabilities are depreciated over the period until retirement activities are expected to occur. Total accretion and depreciation expenses for 2019, 2018 and 2017 were $9.1 million, $8.0 million and $8.7 million, respectively, and are included in Other operating income and expenses, net, in the consolidated statements of earnings.

years ended December 31 (in millions)	2019			2018
Balance at beginning of year	$	121.8		$	109.7
Accretion expense		5.6			5.1
Liabilities incurred and liabilities assumed in business combinations		0.6			4.6
Liabilities settled		(1.2	)		(2.8	)
Revisions in estimated cash flows		17.1			5.2
Balance at end of year	$	143.9		$	121.8

Other Environmental Matters. The Company’s operations are subject to and affected by federal, state and local laws and regulations relating to the environment, health and safety and other regulatory matters. Certain of the Company’s operations may, from time to time, involve the use of substances that are classified as toxic or hazardous within the meaning of these laws and regulations. Environmental operating permits are, or may be, required for certain of the Company’s operations, and such permits are subject to modification, renewal and revocation. The Company regularly monitors and reviews its operations, procedures and policies for compliance with these laws and regulations. Despite these compliance efforts, risk of environmental remediation liability is inherent in the operation of the Company’s businesses, as it is with other companies engaged in similar businesses. The Company has no material provisions for environmental remediation liabilities and does not believe such liabilities will have a material adverse effect on the Company in the future.

Insurance Reserves. At December 31, 2019 and 2018, reserves of $39.9 million and $48.3 million, respectively, were recorded for insurance claims.

Letters of Credit. In the normal course of business, the Company provides certain third parties with standby letter of credit agreements guaranteeing its payment for certain insurance claims, contract performance and permit requirements. At December 31, 2019, the Company was contingently liable for $32.9 million in letters of credit.

Surety Bonds. In the normal course of business, at December 31, 2019, the Company was contingently liable for $395.1 million in surety bonds required by certain states and municipalities and their related agencies. The bonds are principally for

certain insurance claims, construction contracts, reclamation obligations and mining permits guaranteeing the Company’s own performance. The Company has indemnified the underwriting insurance company, Liberty Mutual, against any exposure under the surety bonds. In the Company’s past experience, no material claims have been made against these financial instruments.

Borrowing Arrangements with Affiliate. The Company is a co-borrower with an unconsolidated affiliate for a $15.5 million revolving line of credit agreement with Truist Bank, a successor by merger to Suntrust Bank and formerly known as BB&T, of which $11.3 million was outstanding as of December 31, 2019. The line of credit expires in March 2020. The affiliate has agreed to reimburse and indemnify the Company for any payments and expenses the Company may incur from this agreement. The Company holds a lien on the affiliate’s membership interest in a joint venture as collateral for payment under the revolving line of credit.

At December 31, 2019 and 2018, the Company had an interest-only $6.0 million note receivable from the unconsolidated affiliate due December 31, 2022.

Purchase Commitments. The Company had purchase commitments for property, plant and equipment of $93.4 million as of December 31, 2019. The Company also had other purchase obligations related to energy and service contracts of $82.9 million as of December 31, 2019. The Company’s contractual purchase commitments as of December 31, 2019 are as follows:

(in millions)
2020	$	140.6
2021		15.0
2022		3.0
2023		0.9
2024		0.9
Thereafter		15.9
Total	$	176.3

Capital expenditures in 2019, 2018 and 2017 that were purchase commitments as of the prior year end were $106.7 million, $79.3 million and $83.7 million, respectively.

Contracts of Affreightment and Royalty Commitments. Future minimum contracts of affreightment and royalty commitments for all noncancelable agreements as of December 31, 2019 are as follows:

(in millions)	Contracts of Affreightment		Royalty Commitments
2020	$	15.8	$	15.7
2021		16.1		11.1
2022		16.3		10.3
2023		16.6		9.2
2024		16.9		8.9
Thereafter		52.2		59.7
Total	$	133.9	$	114.9

Employees. Approximately 11% of the Company’s employees are represented by a labor union. All such employees are hourly employees. The Company maintains collective bargaining agreements relating to the union employees within the Building Materials business and Magnesia Specialties segment. 100% of the hourly employees of the Magnesia Specialties segment, located in Manistee, Michigan and Woodville, Ohio, are represented by labor unions. The Woodville collective bargaining agreement expires in June 2022. The Manistee collective bargaining agreement expires in August 2023.