L. Income and Production Taxes  – We provide for federal, state and foreign income taxes currently payable, as well as those deferred due to  timing differences between reporting income and expenses for financial statement purposes versus tax purposes. Federal, state and foreign tax  benefits are recorded as a reduction of income taxes, when applicable. We record deferred tax liabilities and assets for expected future tax  consequences of temporary differences between the financial statement carrying amounts and the tax bases of those assets and liabilities, as well as  operating loss and tax credit carryforwards, using enacted tax rates in effect in the years in which the differences are expected to reverse. We evaluate uncertain tax positions in a two-step process, whereby (i) it is determined whether it is more likely than not that the tax positions will be  sustained based on the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, the  largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the related tax authority would be  recognized. We classify mine license taxes incurred in the states of Alaska and Idaho as other direct production costs reported in our gross profits. Our costs for  mine license taxes for the years ended December 31, 2012, December 31, 2011, and December 31, 2010 were $5.7 million, $6.4 million, and $9.6  million, respectively. Approximately 98% or more of the taxes accrued in all three periods were for the State of Alaska. For additional information, see  Note 5 – Income Taxes . M. Reclamation and Remediation Costs (Asset Retirement Obligations)  – At our operating properties, we record a liability for the present  value of our estimated environmental remediation costs, and the related asset created with it, in the period in which the liability is incurred. The liability  is accreted and the asset is depreciated over the life of the related assets. Adjustments for changes resulting from the passage of time and changes to  either the timing or amount of the original present value estimate underlying the obligation are made in the period incurred. At our non-operating properties, we accrue costs associated with environmental remediation obligations when it is probable that such costs will be  incurred and they are reasonably estimable. Accruals for estimated losses from environmental remediation obligations have historically been  recognized no later than completion of the remedial feasibility study for such facility and are charged to current earnings to provision for closed  operations and environmental matters. Costs of future expenditures for environmental remediation are not discounted to their present value unless  subject to a contractually obligated fixed payment schedule. Such costs are based on management’s current estimate of amounts to be incurred when  the remediation work is performed, within current laws and regulations. Future closure, reclamation and environmental-related expenditures are difficult to estimate in many circumstances, due to the early stage nature of  investigations, uncertainties associated with defining the nature and extent of environmental contamination, the application of laws and regulations by  regulatory authorities, and changes in reclamation or remediation technology. We periodically review accrued liabilities for such reclamation and  remediation costs as evidence becomes available indicating that our liabilities have potentially changed. Changes in estimates at our non-operating  properties are reflected in current period net income (loss). Accruals for closure costs, reclamation and environmental matters for operating and non-operating properties totaled $113.2 million at December  31, 2012, and the majority of these expenditures relating to these accruals will be made over the next two years. It is reasonably possible the ultimate  cost of reclamation and remediation could change in the future, and that changes to these estimates could have a material effect on future operating  results as new information becomes known. N. Revenue Recognition and Smelter Accounts Receivable  – Sales of all metals products sold directly to smelters, including by-product metals,  are recorded as revenues and accounts receivable when title and risk of loss transfer to the smelter (generally at the time of shipment) at estimated  forward prices for the anticipated month of settlement. Due to the time elapsed from shipment to the smelter and the final settlement with the smelter,  we must estimate the prices at which sales of our metals will be settled. Previously recorded sales and accounts receivable are adjusted to estimated  settlement metals prices until final settlement by the smelter. Sales and accounts receivable for concentrate shipments to smelters are recorded net of charges by the smelters for treatment, refining, smelting  losses, and other charges negotiated by us with the smelters. Charges are estimated by us upon shipment of concentrates based on contractual terms,  and actual charges do not vary materially from our estimates. Costs charged by smelters include fixed treatment and refining costs per ton of  concentrate, and also include price escalators which allow the smelters to participate in the increase of lead and zinc prices above a negotiated  baseline. Changes in metals prices between shipment and final settlement will result in adjustments to revenues and accounts receivable related to sales of  concentrate previously recorded upon shipment. Our concentrate sales and accounts receivable are based on provisional sales prices containing an  embedded derivative that is required to be separated from the host contract for accounting purposes. The host contract is the receivable from the sale  of the concentrates at the forward price at the time of the sale. The embedded derivative, which does not qualify for hedge accounting, is adjusted to  market through earnings each period prior to final settlement. At December 31, 2012, metals contained in concentrates and exposed to future price changes totaled 0.8 million ounces of silver, 3,912 ounces of  gold, 12,189 tons of zinc, and 3,887 tons of lead. However, as discussed in  P. Risk Management Contracts  below, we utilize a program to mitigate the  risk of negative price adjustments with limited mark-to-market financially settled forward contracts for our zinc and lead sales. Sales of metals in products tolled by refiners and sold directly by us, rather than sold to smelters, are recorded at contractual amounts when title and  risk of loss transfer to the buyer. We sell finished metals after refining, as well as doré produced at our locations. Sales from our Greens Creek and Lucky Friday units include significant value from by-product metals mined along with net values of each unit’s  primary metal. We periodically review our proven and probable reserves to ensure that reporting of primary products and by-products is appropriate.  Within our cost per ounce calculations, because we consider zinc, lead, and gold to be by-products of our silver production, the values of these metals  offset operating costs. While value from zinc, lead, and gold is significant at Greens Creek, and value from lead and zinc is significant at Lucky Friday,  we believe identification of silver as the primary product, with the other metals we produce as by-product credits, is appropriate because (i) silver has  historically accounted for a higher proportion of revenue than any other metal and is expected to do so in the future, (ii) our operations are situated in  mining districts associated with silver production or have deposits containing unusually high portions of silver, (iii) our operations generally utilize  selective mining methods to target silver and metallurgical treatment that maximize silver recovery, and (iv) we have historically presented our  operations as primary producers of silver, based on the original analyses that justified putting them into production, and believe that consistency in  disclosure is important to our investors regardless of the relationships of metals prices and production from year to year. Changes in the market price of metals significantly affect our revenues, profitability, and cash flow. Metals prices can and often do fluctuate widely  and are affected by numerous factors beyond our control, such as political and economic conditions, demand, forward selling by producers,  [ HL:10-K ] F-9