Note 10 — Defined Benefit Pension and Other Postretirement Plans

We sponsor a defined benefit pension plan for employees hired prior to January 1, 2009, of UGI, UGI Utilities, PNG, CPG and certain of UGI’s other domestic wholly owned subsidiaries. Pension Plan benefits are based on years of service, age and employee compensation. We also provide limited postretirement health care benefits to certain retirees and postretirement life insurance benefits to certain active and retired employees.

Net periodic pension expense and other postretirement benefit costs include the following components:



	Pension Benefits						Other Postretirement Benefits
Three Months Ended March 31,	2019			2018			2019			2018
Service cost	$	1,638		$	1,881		$	32		$	67
Interest cost	6,051			5,767			109			112
Expected return on assets	(8,140		)	(7,777		)	(184		)	(177		)
Amortization of:
Prior service cost (benefit)	62			63			(109		)	(110		)
Actuarial loss	1,721			2,984			17			24
Net benefit cost (benefit)	1,332			2,918			(135		)	(84		)
Change in associated regulatory liabilities	—			—			(342		)	(123		)
Net benefit cost (benefit) after change in regulatory liabilities	$	1,332		$	2,918		$	(477	)	$	(207	)

	Pension Benefits						Other Postretirement Benefits
Six Months Ended March 31,	2019			2018			2019			2018
Service cost	$	3,275		$	3,762		$	63		$	134
Interest cost	12,101			11,534			218			224
Expected return on assets	(16,280		)	(15,554		)	(369		)	(354		)
Amortization of:
Prior service cost (benefit)	125			126			(218		)	(220		)
Actuarial loss	3,441			5,968			34			48
Net benefit cost (benefit)	2,662			5,836			(272		)	(168		)
Change in associated regulatory liabilities	—			—			(685		)	(246		)
Net benefit cost (benefit) after change in regulatory liabilities	$	2,662		$	5,836		$	(957	)	$	(414	)

Pension Plan assets are held in trust and consist principally of publicly traded, diversified equity and fixed income mutual funds and, to a much lesser extent, UGI Common Stock. It is our general policy to fund amounts for Pension Plan benefits equal to at least the minimum contribution required by ERISA. From time to time we may, at our discretion, contribute additional amounts. During the six months ended March 31, 2019 and 2018, the Company made cash contributions to the Pension Plan of $5,000 and $6,720, respectively. The Company expects to make additional cash contributions of approximately $6,500 to the Pension Plan during the remainder of Fiscal 2019.

UGI Utilities has established a VEBA trust to pay retiree health care and life insurance benefits by depositing into the VEBA the annual amount of postretirement benefits costs, if any. The difference between such cash deposits or expense recorded and the amounts included in UGI Gas’ and Electric Utility’s rates, if any, is deferred for future recovery from, or refund to, ratepayers. There were no required contributions to the VEBA during the six months ended March 31, 2019 and 2018.

We also participate in an unfunded and non-qualified defined benefit supplemental executive retirement plan. Net benefit costs associated with this plan for all periods presented were not material.