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Balance Sheet Items
 9 Months Ended
Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Balance Sheet Items Balance Sheet Items
Allowance for doubtful accounts
The following table presents the changes in the allowance for doubtful accounts:
Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
Balance, beginning of period$249 $— $146 $— 
Add: provision
5 — 124 — 
Less: deduction and other adjustments
(2)— (18)— 
Balance, end of period$252 $— $252 $— 
Property and equipment, net
The following table shows the components of property and equipment, net:
September 30, 2020December 31, 2019
Plant, machinery and equipment$79,781 $75,578 
Structural fill site improvements55,760 55,760 
Vehicles18,396 19,163 
Office equipment2,847 2,741 
Buildings and leasehold improvements262 262 
Structural fill sites432 7,110 
Construction in progress7,474 12,324 
Total property and equipment
$164,952 $172,938 
Less: accumulated depreciation(100,183)(87,644)
Property and equipment, net
$64,769 $85,294 
Depreciation expense was $4,818 and $3,304 for the three months ended September 30, 2020 and 2019, respectively, and $13,939 and $13,636 for the nine months ended September 30, 2020 and 2019, respectively.
Impairment of Long-Lived Assets Other than Goodwill
Long-lived assets other than goodwill and indefinite-lived intangible assets, held and used by the Company, including property and equipment and long-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company evaluates recoverability of assets to be held and used by comparing the
carrying amount of an asset to the future net undiscounted cash flows expected to be generated by the asset to determine if the carrying value is not recoverable. If the carrying value is not recoverable, the Company fair values the asset and compares to the carrying value. If the asset is considered to be impaired, the impairment loss is measured as the amount by which the carrying amount of the asset exceeds its fair value.
During the three and nine months ended September 30, 2020, as a result of the expiration of the option as discussed below, the Company determined that a triggering event had occurred that indicated that the asset group may not be recoverable as the option expiration led to a significant adverse change in the manner in which the long-lived asset was being used. The Company evaluated the recoverability of the structural fill site assets to be held and used by comparing the carrying amount of the asset group to the future net undiscounted cash flows expected to be generated to determine if the carrying value is not recoverable. The recoverability test indicated that these assets were not recoverable. The fair value of the assets was determined using an income approach of the discounted cash flows expected from the assets and compared to the assets' carrying value, which indicated that the assets were impaired and resulted in an impairment charge. The Company recognized an impairment charge of $6,399 during the three and nine months ended September 30, 2020. The long-lived assets impaired during the three and nine months ended September 30, 2020 had a remaining fair value of $711 prior to the asset retirement obligation reassessment discussed below.
Purchase option liability
As part of the transaction in which BCP acquired a 76% equity position of Charah Management (the “BCP transaction”), Charah recorded the fair value of a bargain purchase liability for options held by a customer and a third party for the structural fill sites. The purchase option liability was calculated as the difference between the estimated fair value of the structural fill sites at the date of the BCP transaction and the option price to be paid by the customer or third party. The purchase options were exercisable after completion of work at the structural fill sites. The options expired without exercise in August 2020, and the remaining purchase option liability was reduced through amortization expense within general and administrative expenses in our unaudited condensed consolidated statement of operations.
The following table reflects activity related to the bargain purchase liability:
Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
Balance, beginning of period$7,110 $7,110 $7,110 $10,017 
Amortization expense(7,110)— (7,110)(2,907)
Balance, end of period$— $7,110 $— $7,110 
Accrued liabilities
The following table shows the components of accrued liabilities:
September 30, 2020December 31, 2019
Accrued expenses$19,309 $20,456 
Accrued payroll and bonuses24,014 13,273 
Accrued dividends877 — 
Accrued interest823 1,761 
Accrued liabilities
$45,023 $35,490 
Asset Retirement Obligations
The Company owns and operates two structural fill sites that will have continuing maintenance and monitoring requirements subsequent to their closure. As of September 30, 2020 and December 31, 2019, the Company has accrued $6,947 and $15,131, respectively, for the asset retirement obligation.
The following table reflects the activity for the asset retirement obligation:
Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
Balance, beginning of period$10,948 $20,945 $15,131 $26,065 
Liabilities incurred
— — — 1,017 
Liabilities settled
(2,009)(3,440)(6,542)(10,222)
Change in estimated cash flows(2,127)— (2,127)— 
Accretion
135 262 485 907 
Balance, end of period6,947 17,767 6,947 17,767 
Less: current portion
(2,921)(13,738)(2,921)(13,738)
Non-current portion$4,026 $4,029 $4,026 $4,029 
After the expiration of the option and the impairment of the structural fill site assets as discussed above, during the three months ended September 30, 2020, the Company performed a review of the asset retirement obligation to determine if there had been changes in the estimated amount or timing of cash flows. The Company identified a downward adjustment of $2,127 primarily due to the refinement of cost information associated with project bonding and insurance and the decrease in actual closure costs incurred since the site has ceased operations. The Company views the asset retirement obligation and the related structural fill site asset as a single asset so we first recorded a reduction of $279 to the carrying value of the asset and then recorded the excess balance of $1,848 as a reduction to cost of sales in the unaudited condensed consolidated statement of operations.