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

ORGANIZATION AND BASIS OF PRESENTATION (Tables)

9 Months Ended

Sep. 30, 2019

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



	As of
	September 30, 2019				December 31, 2018
	Outstanding		Estimated work remaining to complete		Outstanding		Estimated work remaining to complete
Sureties:
Sureties related to owned projects and lots under contract	$	378,154	$	171,108	$	339,221	$	133,662
Total Sureties	$	378,154	$	171,108	$	339,221	$	133,662
Letters of Credit (“LOCs”):
LOCs for land development	48,943		N/A		70,287		N/A
LOCs for general corporate operations	3,750		N/A		3,750		N/A
Total LOCs	$	52,693	N/A		$	74,037	N/A

Accrued liabilities at September 30, 2019 and December 31, 2018 consisted of the following (in thousands):



	As of
	September 30, 2019		December 31, 2018
Accruals related to real estate development and construction activities	$	76,988	$	54,589
Payroll and other benefits	50,767		60,209
Accrued interest	33,703		13,296
Accrued taxes	15,006		7,548
Warranty reserves	21,311		24,552
Lease liability ⁽¹⁾	33,148		—
Other accruals	9,179		17,668
Total	$	240,102	$	177,862

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



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Balance, beginning of period	$	20,927		$	23,659		$	24,552		$	23,328
Additions to reserve from new home deliveries	4,150			4,092			11,425			11,645
Warranty claims	(3,766		)	(4,887		)	(14,666		)	(12,109		)
Adjustments to pre-existing reserves	—			—			—			—
Balance, end of period	$	21,311		$	22,864		$	21,311		$	22,864