Commitments And Contingencies

9 Months Ended

Sep. 30, 2011

Commitments And Contingencies [Abstract]

Commitments And Contingencies

Note 13 – Commitments and Contingencies

Unconsolidated Debt

Total debt of unconsolidated joint ventures and entities was $652,000 and $653,000 as of September 30, 2011 and December 31, 2010. Our share of unconsolidated debt, based on our ownership percentage, was $217,000 and $218,000 as of September 30, 2011 and December 31, 2010. This debt is guaranteed by one of our subsidiaries to the extent of our ownership percentage.

U.S. Federal Tax Settlement

            As indicated in our 2010 Annual Report, our subsidiary, Craig Corporation ("Craig"), and the Internal Revenue Service (the "IRS") in July 2010, settled the proposed assessment by the IRS against Craig for the 1996 tax year.  The original assessment of $20.1 million plus interest was settled for $5.4 million plus interest, as reflected in the final judgment of the Tax Court dated January 6, 2011.  On October 26, 2011, the IRS and our subsidiary Craig Corporation ("Craig")  agreed to a payment arrangement that will allow Craig to retire this tax settlement debt in approximately five years though monthly payments of $290,000 (see Note 20 – Subsequent Events).  We anticipate federal and state tax deductions will be available for interest paid to the IRS and to state tax agencies, and that a federal deduction will be available for taxes paid to state tax agencies. 

            The impact of the settlement upon our liability for state taxes remains uncertain but if the adjustment to income agreed with the IRS were reflected on state returns, it would cause a state tax obligation of approximately $1.4 million plus interest and penalty, if any.  As of September 30, 2011, no deficiency has been asserted by the State of California, and we have made no final decision as to the course of action to be followed if a deficiency were to be asserted.