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Contract Assets and Liabilities
 6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Contract Assets and Liabilities Contract Assets and Liabilities
The Company classifies contract assets and liabilities that may be settled beyond one year from the balance sheet date as current, consistent with the length of time of the Company’s project operating cycle.
Contract assets include costs in excess of billings and estimated earnings and amounts due under retainage provisions. The components of the contract asset balances as of the respective dates were as follows:
(in thousands)June 30, 2021December 31, 2020Change
Contract assets
   Costs in excess of billings and estimated earnings$38,200 $31,894 $6,306 
   Retainage receivable32,615 35,204 (2,589)
      Total contract assets$70,815 $67,098 $3,717 
Retainage receivable represents amounts invoiced to customers where payments have been partially withheld, typically 10%, pending the completion of certain milestones, satisfaction of other contractual conditions or the completion of the project. Retainage agreements vary from project to project and balances could be outstanding for several months or years depending on a number of circumstances such as contract-specific terms, project performance and other variables that may arise as the Company makes progress towards completion.
Contract assets represent the excess of contract costs and profits (or contract revenue) over the amount of contract billings to date and are classified as a current asset. Contract assets result when either: 1) the appropriate contract revenue amount has been recognized over time in accordance with ASC Topic 606, but a portion of the revenue recorded cannot be currently billed due to the billing terms defined in the contract, or 2) costs are incurred related to certain claims and unapproved change orders. Claims occur when there is a dispute regarding both a change in the scope of work and the price associated with that change. Unapproved change orders occur when a change in the scope of work results in additional work being performed before the parties have agreed on the corresponding change in the contract price. The Company routinely estimates recovery related to claims and unapproved change orders as a form of variable consideration at the most likely amount it expects to receive and to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Claims and unapproved change orders are billable upon the agreement and resolution between the contractual parties and after the execution of contractual amendments. Increases in claims and unapproved change orders typically result from costs being incurred against existing or new positions; decreases normally result from resolutions and subsequent billings.

The current estimated net realizable value on such claims and unapproved change orders as recorded in contract assets and contract liabilities in the condensed consolidated balance sheets was $40.1 million and $33.6 million as of June 30, 2021 and December 31, 2020, respectively. The Company anticipates that the majority of such amounts will be approved or executed within one year. The resolution of these claims and unapproved change orders may require litigation or other forms of dispute resolution proceedings.

Contract liabilities include billings in excess of costs and estimated earnings and provisions for losses. The components of the contract liability balances as of the respective dates were as follows:
(in thousands)June 30, 2021December 31, 2020Change
Contract liabilities
   Billings in excess of costs and estimated earnings$38,611 $46,020 $(7,409)
   Provisions for losses568 628 (60)
      Total contract liabilities$39,179 $46,648 $(7,469)

Billings in excess of costs and estimated earnings represent the excess of contract billings to date over the amount of contract costs and profits (or contract revenue) recognized to date. The balance may fluctuate depending on the timing of contract billings and the recognition of contract revenue.

Provisions for losses are recognized in the condensed consolidated statements of operations at the uncompleted performance obligation level for the amount of total estimated losses in the period that evidence indicates that the estimated total cost of a performance obligation exceeds its estimated total revenue.
The net overbilling position for contracts in process consist of the following:
(in thousands)June 30, 2021December 31, 2020
Revenue earned on uncompleted contracts$691,473 $752,564 
Less: Billings to date(691,884)(766,690)
   Net overbilling$(411)$(14,126)
(in thousands)June 30, 2021December 31, 2020
Costs in excess of billings and estimated earnings$38,200 $31,894 
Billings in excess of costs and estimated earnings(38,611)(46,020)
   Net overbilling$(411)$(14,126)

For the three and six months ended June 30, 2021 and 2020, we recorded revisions in our contract estimates for certain GCR and ODR projects.
For the three months ended June 30, 2021 and 2020, total net gross profit write-downs were $1.1 million and $2.0 million, respectively. For projects having a material gross profit impact of $0.25 million or more for the three months ended June 30, 2021, this resulted in material gross profit write downs on three GCR segment projects of $1.7 million and one ODR project for $0.3 million. Of the material GCR segment write downs, one project was within the Michigan region for a total of $1.0 million, one project was within the New England region for $0.3 million and one project was within the Southern California region for $0.4 million. Of the material ODR segment write downs, one project was within the Eastern Pennsylvania region for $0.3 million. We also recorded material gross profit write ups of $0.3 million on one GCR segment project in the Florida region and $0.3 million on one ODR segment project in the Michigan region. For the three months ended June 30, 2020, we recorded material revisions in our contract estimates on four GCR projects which resulted in gross profit write downs of $1.5 million. Two of these projects were within the Southern California region for a total of $0.7 million. No project revisions resulting in material gross profit write ups were recorded during the three months ended June 30, 2020.

For the six months ended June 30, 2021 and 2020, total net gross profit write-downs were $1.7 million and $3.4 million, respectively. For projects having a material gross profit impact of $0.25 million or more, we recorded gross profit write downs on eight GCR segment projects of $3.5 million and one ODR project for $0.3 million. Of the material GCR segment write downs, two projects were within the Michigan region for a total of $1.2 million, two projects were within the Eastern Pennsylvania region for $1.0 million, two projects were within the Southern California region for $0.8 million, one project was within the New England region for $0.3 million, and one project was within the Mid-Atlantic region for $0.3 million. We also materially wrote down one ODR segment project within the Eastern Pennsylvania region for $0.3 million. We also recorded material GCR segment gross profit write ups of $0.9 million on one GCR segment project in the Michigan region for $0.5 million and one project within the Ohio region for $0.4 million. For the six months ended June 30, 2020, we recorded material gross profit write downs on eight GCR projects and two gross profit write ups on GCR projects, for an aggregate revision of $5.2 million and $1.2 million, respectively.
Remaining Performance Obligations
Remaining performance obligations represent the transaction price of firm orders for which work has not been performed and exclude unexercised contract options. The Company’s remaining performance obligations includes projects that have a written award, a letter of intent, a notice to proceed or an agreed upon work order to perform work on mutually accepted terms and conditions.
As of June 30, 2021, the aggregate amount of the transaction prices allocated to the remaining performance obligations of the Company's GCR and ODR segment contracts were $378.9 million and $44.2 million, respectively. As of December 31, 2020, the aggregate amount of the transaction prices allocated to the remaining performance obligations of the Company's GCR and ODR segment contracts were $393.5 million and $35.7 million, respectively.
We estimate that 44% and 62% of our GCR and ODR segment remaining performance obligations as of June 30, 2021, respectively, will be recognized as revenue during 2021, with the substantial majority of remaining performance obligations to be recognized within 24 months, although the timing of the Company's performance is not always under its control.
Additionally, the difference between remaining performance obligations and backlog is due to the exclusion of a portion of the Company’s ODR agreements under certain contract types from the Company’s remaining performance obligations as these contracts can be canceled for convenience at any time by the Company or the customer without considerable cost incurred by the customer. Additional information related to backlog is provided in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Quarterly Report on Form 10-Q.