BENEFIT PLANS

Qualified and Non-qualified Defined Benefit Plans

Cablevision Retirement Plans (collectively, the "Defined Benefit Plans")

The Company sponsors a non-contributory qualified defined benefit cash balance retirement plan (the "Pension Plan") for the benefit of non-union employees other than those of Newsday, as well as certain employees covered by a collective bargaining relationship in Brooklyn. Under the Pension Plan, the Company credits a certain percentage of eligible pay (“Pay Credits”) into an account established for each participant which is credited with a monthly market based rate of return.

The Company maintains an unfunded non-contributory non-qualified defined benefit excess cash balance plan ("Excess Cash Balance Plan") covering certain employees of the Company who participate in the Pension Plan, as well as an additional unfunded non-contributory, non-qualified defined benefit plan ("CSC Supplemental Benefit Plan") for the benefit of certain officers and employees of the Company which provides that, upon retiring on or after normal retirement age, a participant will receive a benefit equal to a specified percentage of the participant's average compensation, as defined. All participants are 100% vested in the CSC Supplemental Benefit Plan.

The Company amended the Pension Plan and the Excess Cash Balance Plan to freeze participation and future benefit accruals effective December 31, 2013 for all Company employees except those covered by a collective bargaining relationship in Brooklyn. Therefore, after December 31, 2013, no employee of the Company who was not already a participant became a participant in the plans and no further annual Pay Credits were made, except for employees covered by a collective bargaining relationship in Brooklyn. Existing account balances under the plans continue to be credited with monthly interest in accordance with the terms of the plans.

Plan Results for Defined Benefit Plans

Summarized below is the funded status and the amounts recorded on the Company's consolidated balance sheets for all of the Company's Defined Benefit Plans at December 31, 2014 and 2013:



	December 31,
	2014			2013
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	433,916		$	392,312
Service cost	774			45,346
Interest cost	18,040			14,128
Actuarial loss	9,006			5,282
Transfer of liabilities	—			(208		)
Benefits paid	(30,890		)	(22,944		)
Projected benefit obligation at end of year	430,846			433,916

Change in plan assets:
Fair value of plan assets at beginning of year	268,610			290,836
Actual return (loss) on plan assets, net	11,687			(8,694		)
Employer contributions	54,269			9,620
Transfer of assets	—			(208		)
Benefits paid	(30,890		)	(22,944		)
Fair value of plan assets at end of year	303,676			268,610

Unfunded status at end of year	$	(127,170	)	$	(165,306	)

Other changes in plan assets and benefit obligations recorded in accumulated other comprehensive loss for the years ended December 31, 2014 and 2013 are as follows:



		Defined Benefit Plans
Changes in plan assets and benefit obligations, before taxes:		2014			2013			2012
	Unrecognized actuarial loss	$	6,866		$	21,842		$	16,732
	Tax expense (benefit)	(2,815		)	(8,984		)	(6,848		)
		4,051			12,858			9,884

	Amortization of actuarial losses, net included in net periodic benefit cost	(2,364		)	(1,645		)	(1,067		)
	Tax expense (benefit)	969			677			437
		(1,395		)	(968		)	(630		)

	Settlement loss included in net periodic benefit cost	(5,348		)	—			—
	Tax expense (benefit)	2,193			—			—
		(3,155		)	—			—

Changes in plan assets and benefit obligations, net of taxes		$	(499	)	$	11,890		$	9,254

The accumulated benefit obligation for the Company's Defined Benefit Plans aggregated $430,846 and $433,916 at December 31, 2014 and 2013, respectively.

Approximately $2,239 of unrecognized actuarial losses recorded in accumulated other comprehensive loss is expected to be recognized as a component of net periodic benefit cost during 2015 relating to the Defined Benefit Plans.

The Company's net funded status relating to its defined benefit plans at December 31, 2014 and 2013 are as follows:



	2014			2013
Defined Benefit Plans	$	(127,170	)	$	(165,306	)
Less: Current portion	6,526			2,494
Long-term defined benefit plan obligations	$	(120,644	)	$	(162,812	)

Components of the net periodic benefit cost, recorded primarily in selling, general and administrative expenses, for the Defined Benefit Plans for the years ended December 31, 2014, 2013 and 2012, are as follows:



	Years Ended December 31,
	2014			2013			2012

Service cost	$	774		$	45,346		$	39,789
Interest cost	18,040			14,128			14,570
Expected return on plan assets, net	(9,548		)	(7,866		)	(9,127		)
Recognized actuarial loss (reclassified from accumulated other comprehensive loss)	2,364			1,645			752
Settlement loss (reclassified from accumulated other comprehensive loss) (a)	5,348			—			315
Net periodic benefit cost	$	16,978		$	53,253		$	46,299

(a)

As a result of benefit payments to terminated or retired individuals exceeding the service and interest costs for the Pension Plan and the Excess Cash Balance Pension Plan during 2014, the Company recognized a non-cash settlement loss that represented the acceleration of the recognition of a portion of the previously unrecognized actuarial losses recorded in accumulated other comprehensive loss on the Company’s consolidated balance sheets relating to these plans.

Plan Assumptions for Defined Benefit Plans

Weighted-average assumptions used to determine net periodic cost (made at the beginning of the year) and benefit obligations (made at the end of the year) for the Defined Benefit Plans are as follows:



	Weighted-Average Assumptions
	Net Periodic Benefit Cost for the Years Ended December 31,						Benefit Obligations at December 31,
	2014		2013		2012		2014		2013
Discount rate (a)	4.24	%	3.67	%	4.32	%	3.70	%	4.56	%
Rate of increase in future compensation levels	3.50	%	3.50	%	3.50	%	3.50	%	3.50	%
Expected rate of return on plan assets (Pension Plan only)	4.53	%	3.60	%	3.76	%	N/A		N/A


(a)	The discount rate of 4.24% in 2014 represents the average of the quarterly discount rates used to remeasure the Company's projected benefit obligation and net periodic benefit cost in connection with the recognition of settlement losses discussed above.

The discount rate used by the Company in calculating the net periodic benefit cost for the Cash Balance Plan and the Excess Cash Balance Plan was determined based on the expected future benefit payments for the plans and from the Towers Watson U.S. Rate Link: 40-90 Discount Rate Model. The model was developed by examining the yields on selected highly rated corporate bonds.

The Company's expected long-term return on Pension Plan assets is based on a periodic review and modeling of the plan's asset allocation structure over a long-term horizon. Expectations of returns for each asset class are the most important of the assumptions used in the review and modeling and are based on comprehensive reviews of historical data, forward looking economic outlook, and economic/financial market theory. The expected long-term rate of returns were selected from within the reasonable range of rates determined by (a) historical real returns, net of inflation, for the asset classes covered by the investment policy, and (b) projections of inflation over the long-term period during which benefits are payable to plan participants.

Pension Plan Assets and Investment Policy

The weighted average asset allocations of the Pension Plan at December 31, 2014 and 2013 were as follows:



	Plan Assets at December 31,
	2014		2013
Asset Class:
Mutual funds	39	%	—	%
Fixed income securities	58		88
Cash equivalents and other	3		12
	100	%	100	%

The Pension Plan's investment objectives reflect an overall low risk tolerance to stock market volatility. This strategy allows for the Pension Plan to invest in portfolios that would obtain a rate of return throughout economic cycles, commensurate with the investment risk and cash flow needs of the Pension Plan. The investments held in the Pension Plan are readily marketable and can be sold to fund benefit payment obligations of the plan as they become payable.

Investment allocation decisions are formally made by the Company's Investment and Benefit Committee, which takes into account investment advice provided by its external investment consultant. The investment consultant takes into account expected long-term risk, return, correlation, and other prudent investment assumptions when recommending asset classes and investment managers to the Company's Investment and Benefit Committee. The Committee considers recommendations based on asset/liability studies conducted by the external investment consultant who combines actuarial considerations, Pension Plan liabilities and strategic investment advice. The major categories of the Pension Plan assets are cash equivalents and bonds which are marked-to-market on a daily basis. Due to the Pension Plan's significant holdings in long-term government and non-government fixed income securities, the Pension Plan's assets are subjected to interest rate risk; specifically, a rising interest rate environment. However, these assets are structured in an asset/liability framework. Consequently, an increase in interest rates causes a corresponding decrease to the overall liability of the Pension Plan thus creating a hedge against rising interest rates. Additional risks involving the asset/liability framework include earning insufficient returns to cover future liabilities and imperfect hedging of the liability. In addition, a portion of the Pension Plan's bond portfolio is invested in foreign debt securities where there could be foreign currency risks associated with them, as well as in non-government securities which are subject to credit risk of the bond issuer defaulting on interest and/or principal payments.

Investments at Estimated Fair Value

The fair values of the assets of the Pension Plan at December 31, 2014 by asset class are as follows:



Asset Class	Level I		Level II		Level III		Total

Mutual funds	$	119,543	$	—	$	—	$	119,543
Fixed income securities held in a portfolio:
Foreign issued corporate debt	—		17,778		—		17,778
U.S. corporate debt	—		50,155		—		50,155
Government debt	—		10,239		—		10,239
U.S. Treasury securities	—		81,552		—		81,552
Asset-backed securities	—		17,610		—		17,610
Cash equivalents (a)	3,580		—		—		3,580
Total (b)	$	123,123	$	177,334	$	—	$	300,457


(a)	Represents an investment in a money market fund.


(b)	Excludes cash and net receivables relating to the sale of securities that were not settled as of December 31, 2014.

The fair values of the assets of the Pension Plan at December 31, 2013 by asset class are as follows:



Asset Class	Level I		Level II		Level III		Total

Fixed income securities held in a portfolio:
Foreign issued corporate debt	$	—	$	26,998	$	—	$	26,998
U.S. corporate debt	—		75,068		—		75,068
Government debt	—		11,993		—		11,993
U.S. Treasury securities	—		121,895		—		121,895
Cash equivalents (a)	8,444		29,019		—		37,463
Total (b)	$	8,444	$	264,973	$	—	$	273,417


(a)	A significant portion represents an investment in a short-term investment fund that invests primarily in securities of high quality and low risk.


(b)	Excludes net payables relating to the purchase of securities that were not settled as of December 31, 2013.

Benefit Payments and Contributions for Defined Benefit Plans

The following benefit payments are expected to be paid:



2015	$	41,115
2016	31,440
2017	28,690
2018	28,540
2019	27,820
2020-2024	132,360

Of the amounts expected to be paid in 2015, the Company has recorded approximately $6,500 as a current liability in its consolidated balance sheets at December 31, 2014, since this amount represents the aggregate benefit payment obligation payable in the next twelve months for the Company's nonqualified Excess Cash Balance Plan and CSC Supplemental Benefit Plan at December 31, 2014.

The Company currently expects to contribute approximately $25,000 to the Pension Plan in 2015.

Defined Contribution Plans

The Company also maintains the Cablevision 401(k) Savings Plan, a contributory qualified defined contribution plan for the benefit of non-union employees of the Company. Employees can contribute a percentage of eligible annual compensation and the Company will make a matching cash contribution or discretionary contribution, as defined in the plan. In addition, the Company maintains an unfunded non-qualified excess savings plan for which the Company provides a matching contribution similar to the Cablevision 401(k) Savings Plan.

Effective January 1, 2014, applicable employees of the Company are eligible for an enhanced employer matching contribution, as well as a year-end employer discretionary contribution to the Cablevision 401(k) Savings Plan and the Cablevision Excess Savings Plan.

The cost associated with these plans (including the enhanced employer matching and the discretionary contributions in 2014) was $65,725, $26,757 and $24,160 for the years ended December 31, 2014, 2013 and 2012, respectively.