Meritage Homes Corporation Quarterly report pursuant to Section 13 or 15(d)

ORGANIZATION AND BASIS OF PRESENTATION (Tables)

3 Months Ended

Mar. 31, 2016

The table below outlines our surety bond and letter of credit obligations (in thousands):



	As of
	March 31, 2016				December 31, 2015
	Outstanding		Estimated work remaining to complete		Outstanding		Estimated work remaining to complete
Sureties:
Sureties related to joint ventures	$	—	$	—	$	87	$	87
Sureties related to owned projects and lots under contract	242,117		87,276		250,639		103,200
Total Sureties	$	242,117	$	87,276	$	250,726	$	103,287
Letters of Credit (“LOCs”):
LOCs in lieu of deposits for contracted lots	$	—	N/A		$	—	N/A
LOCs for land development	24,308		N/A		23,934		N/A
LOCs for general corporate operations	3,750		N/A		3,750		N/A
Total LOCs	$	28,058	N/A		$	27,684	N/A

Accrued liabilities at March 31, 2016 and December 31, 2015 consisted of the following (in thousands):



	As of
	March 31, 2016		December 31, 2015
Accruals related to real estate development and construction activities	$	44,406	$	37,509
Payroll and other benefits	24,499		41,240
Accrued taxes	10,386		9,950
Warranty reserves	22,308		21,615
Legal reserves	2,117		18,812
Other accruals	42,167		32,037
Total	$	145,883	$	161,163

A summary of changes in our warranty reserves follows (in thousands):



	Three Months Ended March 31,
	2016			2015
Balance, beginning of period	$	21,615		$	22,080
Additions to reserve from new home deliveries	3,094			2,628
Warranty claims	(2,842		)	(2,869		)
Adjustments to pre-existing reserves	441			—
Balance, end of period	$	22,308		$	21,839