Note 11 - Pension Plan and Other Postretirement Benefits

6 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Pension and Other Postretirement Benefits Disclosure [Text Block]

1

1

.

Pension Plan and Other Postretirement Benefits

Pension Plan

—Components of net periodic pension benefit cost of the Company's noncontributory funded pension plan are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2017			2016			2017			201 6
Service Cost —Benefit Earned During the Period	$	1,407		$	1,381		$	2,814		$	2,763
Interest Cost on Projected Benefit Obligation		3,536			3,521			7,070			7,043
Expected Return on Assets		(4,807	)		(4,866	)		(9,614	)		(9,733	)
Amortization of Prior-Service Cost:
From Regulatory Asset		29			47			59			94
From Other Comprehensive Income 1		1			1			2			2
Amortization of Net Actuarial Loss:
From Regulatory Asset		1,272			1,227			2,545			2,454
From Other Comprehensive Income 1		32			32			63			63
Net Periodic Pension Cost	$	1,470		$	1,343		$	2,939		$	2,686

1

Corporate cost included in Other Nonelectric Expenses.

Cash flows

—The Company currently is

not

required and does

not

anticipate making a contribution to its pension plan in

2017.

The Company made a discretionary plan contribution totaling

$10.0

million in

January 2016.

Executive Survivor and Supplemental Retirement Plan

—Components of net periodic pension benefit cost of the Company’s unfunded, nonqualified benefit plan for executive officers and certain key management employees are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2017		2016		2017		2016
Service Cost —Benefit Earned During the Period	$	72	$	63	$	145	$	126
Interest Cost on Projected Benefit Obligation		421		417		843		834
Amortization of Prior-Service Cost:
From Regulatory Asset		4		4		8		8
From Other Comprehensive Income 1		10		10		19		19
Amortization of Net Actuarial Loss:
From Regulatory Asset		72		73		143		146
From Other Comprehensive Income 2		110		111		220		223
Net Periodic Pension Cost	$	689	$	678	$	1,378	$	1,356
1 Amortization of Prior Service Costs from Other Comprehensive Income Charged to:
Electric Operation and Maintenance Expenses	$	4	$	4	$	8	$	8
Other Nonelectric Expenses		6		6		11		11
2 Amortization of Net Actuarial Loss from Other Comprehensive Income Charged to:
Electric Operation and Maintenance Expenses	$	66	$	68	$	132	$	136
Other Nonelectric Expenses		44		43		88		87

Postretirement Benefits

—Components of net periodic postretirement benefit cost for health insurance and life insurance benefits for retired OTP and corporate employees, net of the effect of Medicare Part D Subsidy:

	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2017			2016			2017			201 6
Service Cost —Benefit Earned During the Period	$	356		$	305		$	712		$	611
Interest Cost on Projected Benefit Obligation		678			542			1,356			1,083
Amortization of Prior-Service Cost:
From Regulatory Asset		--			33			--			66
From Other Comprehensive Income 1		--			1			--			2
Amortization of Net Actuarial Loss:
From Regulatory Asset		233			--			466			--
From Other Comprehensive Income 1		6			--			12			--
Net Periodic Postretirement Benefit Cost	$	1,273		$	881		$	2,546		$	1,762
Effect of Medicare Part D Subsidy	$	(140	)	$	(258	)	$	(280	)	$	(515	)

1

Corporate cost included in Other Nonelectric Expenses.