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WORKERS' COMPENSATION AND PNEUMOCONIOSIS (Tables)
 6 Months Ended
Jun. 30, 2016
Accrued Workers Compensation And Pneumoconiosis Benefits  
Reconciliation of changes in workers' compensation liability

 

 

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

 

 

 

2016

 

2015

 

2016

 

2015

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$
55,564

 

$
58,198

 

$
54,558

 

$
57,557

 

Accruals increase

 
2,187

 
3,500

 
5,424

 
6,167

 

Payments

 
(3,265)

 
(2,100)

 
(5,988)

 
(4,614)

 

Interest accretion

 
492

 
489

 
984

 
977

 

Valuation loss (gain) (1)

 
1,425

 
(4,416)

 
1,425

 
(4,416)

 

 

 

 

 

 

 

 

 

 

 

Ending balance

 

$
56,403

 

$
55,671

 

$
56,403

 

$
55,671

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

The ARLP Partnership’s liability for the estimated present value of current workers’ compensation benefits is based on its actuarial estimates.  The ARLP Partnership’s actuarial calculations are based on a blend of actuarial projection methods and numerous assumptions including claim development patterns, mortality, medical costs and interest rates.  The ARLP Partnership conducted a mid-year review of its actuarial assumptions which resulted in a valuation loss in 2016 primarily attributable to a decrease in the discount rate used to calculate the estimated present value of future obligations from 3.63% at December 31, 2015 to 2.89% at June 30, 2016, partially offset by favorable changes in claims development.  The ARLP Partnership’s mid-year 2015 actuarial review resulted in a valuation gain primarily attributable to favorable changes in claims development and an increase in the discount rate from 3.41% at December 31, 2014 to 3.71% at June 30, 2015.
Pneumoconiosis benefits  
Accrued Workers Compensation And Pneumoconiosis Benefits  
Components of net periodic benefit cost

 

 

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

 

 

 

2016

 

2015

 

2016

 

2015

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Service cost

 

$
644

 

$
732

 

$
1,292

 

$
1,464

 

Interest cost

 
626

 
523

 
1,253

 
1,047

 

Amortization of net actuarial gain (1)

 
(661)

 
(112)

 
(1,322)

 
(225)

 

 

 

 

 

 

 

 

 

 

 

Net periodic benefit cost

 

$
609

 

$
1,143

 

$
1,223

 

$
2,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Amortization of net actuarial gain is included in the Operating expenses (excluding depreciation, depletion and amortization) line item within our condensed consolidated statements of income.