Employee Benefit Plans

6 Months Ended

Jun. 30, 2011

Employee Benefit Plans [Abstract]

Employee Benefit Plans

7. Employee Benefit Plans

Net periodic benefit costs for our pension and post-retirement benefits plans for the three and six months ended June 30, 2011 and 2010 are set forth in the following table:

																	Chesapeake
	Chesapeake						FPU						Chesapeake				Postretirement				FPU
	Pension Plan						Pension Plan						SERP				Plan				Medical Plan
For the Three Months Ended June 30,	2011			2010			2011			2010			2011		2010		2011		2010		2011		2010
(in thousands)
Service Cost	$	—		$	—		$	—		$	—		$	—	$	—	$	—	$	—	$	27	$	27
Interest Cost		130			144			672			637			27		34		15		31		39		34
Expected return on plan assets		(101	)		(106	)		(684	)		(619	)		—		—		—		—		—		—
Amortization of prior service cost		(2	)		(2	)		—			—			5		5		—		—		—		—
Amortization of net loss		39			39			—			—			9		14		—		14		5		—
Net periodic cost (benefit)		66			75			(12	)		18			41		53		15		45		71		61
Amortization of pre-merger regulatory asset		—			—			191			190			—		—		—		—		2		2
Total periodic cost	$	66		$	75		$	179		$	208		$	41	$	53	$	15	$	45	$	73	$	63
																	Chesapeake
	Chesapeake						FPU						Chesapeake				Postretirement				FPU
	Pension Plan						Pension Plan						SERP				Plan				Medical Plan
For the Six Months Ended June 30,	2011			2010			2011			2010			2011		2010		2011		2010		2011		2010
(in thousands)
Service Cost	$	—		$	—		$	—		$	—		$	—	$	—	$	—	$	—	$	53	$	55
Interest Cost		260			289			1,343			1,275			54		68		30		61		78		68
Expected return on plan assets		(202	)		(212	)		(1,368	)		(1,238	)		—		—		—		—		—		—
Amortization of prior service cost		(3	)		(3	)		—			—			10		10		—		—		—		—
Amortization of net loss		78			78			—			—			19		30		—		29		10		—
Net periodic cost (benefit)		133			152			(25	)		37			83		108		30		90		141		123
Settlement expense		217			—			—			—			—		—		—		—		—		—
Amortization of pre-merger regulatory asset		—			—			381			507			—		—		—		—		4		5
Total periodic cost	$	350		$	152		$	356		$	544		$	83	$	108	$	30	$	90	$	145	$	128

We expect to record pension and postretirement benefit costs of approximately $1.9 million for 2011. Included in that amount is a pension settlement expense of $217,000 recorded during the first six months of 2011 related to a lump-sum pension distribution of $844,000 from the Chesapeake Pension Plan in January 2011 and $219,000 of settlement expense in July 2011 related to a lump-sum distribution from the Chesapeake SERP. Also included in that amount is $769,000 related to continued amortization of the FPU pension regulatory asset, which represents the portion attributable to FPU’s regulated energy operations of the changes in funded status that occurred but were not recognized as part of net periodic benefit costs prior to the merger. This was deferred as a regulatory asset by FPU prior to the merger to be recovered through rates pursuant to a previous order by the Florida PSC. The unamortized balance of this regulatory asset was $6.3 million and $6.7 million at June 30, 2011 and December 31, 2010, respectively.

During the six months ended June 30, 2011, we contributed $68,000 to the Chesapeake pension plan. We also contributed $292,000 and $555,000 to the FPU pension plan during the three and six months ended June 30, 2011, respectively. We expect to contribute $955,000 and $1.3 million to the Chesapeake and FPU pension plans, respectively, during the year 2011.

The Chesapeake SERP, the Chesapeake Postretirement Plan and the FPU Medical Plan are unfunded and are expected to be paid out of our general funds. Cash benefits paid under the Chesapeake SERP for the three and six months ended June 30, 2011, were $22,000 and $45,000, respectively; for the year 2011, such benefits paid are expected to be approximately $853,000, which includes the expected lump-sum distribution of $765,000 as mentioned above. Cash benefits paid for the Chesapeake Postretirement Plan, primarily for medical claims for the three and six months ended June 30, 2011, totaled $22,000 and $47,000, respectively; for the year 2011, we have estimated that approximately $96,000 will be paid for such benefits. Cash benefits paid for the FPU Medical Plan, primarily for medical claims for the three and six months ended June 30, 2011, totaled $24,000 and $35,000, respectively; for the year 2011, we have estimated that approximately $158,000 will be paid for such benefits.

In connection with the lump-sum pension distribution from the Chesapeake Pension Plan in January 2011 and the Chesapeake SERP in July 2011, and related settlement accounting, we re-measured the assets and obligations of the Chesapeake Pension Plan. The assumptions used for the discount rate to calculate the benefit obligation remained unchanged at five percent. The average expected return on plan assets also did not change and remained at six percent.