Employee Benefit Plans

9 Months Ended

Sep. 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 nine months ended September 30, 2011 and 2010 are set forth in the following table:

																	Chesapeake
	Chesapeake						FPU						Chesapeake				Postretirement				FPU
(in thousands)	Pension Plan						Pension Plan						SERP				Plan				Medical Plan
For the Three Months Ended September 30,	2011			2010			2011			2010			2011		2010		2011		2010		2011		2010
Service Cost	$	—		$	—		$	—		$	—		$	—	$	—	$	—	$	—	$	26	$	28
Interest Cost		130			147			671			638			26		35		14		30		38		33
Expected return on plan assets		(100	)		(108	)		(683	)		(618	)		—		—		—		—		—		—
Amortization of prior service cost		(1	)		(1	)		—			—			4		5		—		—		—		—
Amortization of net loss		39			40			—			—			10		15		—		15		5		—
Net periodic cost (benefit)		68			78			(12	)		20			40		55		14		45		69		61
Settlement expense		—			—			—			—			219		—		—		—		—		—
Amortization of pre-merger regulatory asset		—			—			190			191			—		—		—		—		2		2
Total periodic cost	$	68		$	78		$	178		$	211		$	259	$	55	$	14	$	45	$	71	$	63
																	Chesapeake
	Chesapeake						FPU						Chesapeake				Postretirement				FPU
(in thousands)	Pension Plan						Pension Plan						SERP				Plan				Medical Plan
For the Nine Months Ended September 30,	2011			2010			2011			2010			2011		2010		2011		2010		2011		2010
Service Cost	$	—		$	—		$	—		$	—		$	—	$	—	$	—	$	—	$	79	$	83
Interest Cost		390			441			2,014			1,913			80		105		44		91		116		101
Expected return on plan assets		(302	)		(323	)		(2,051	)		(1,856	)		—		—		—		—		—		—
Amortization of prior service cost		(4	)		(4	)		—			—			14		15		—		—		—		—
Amortization of net loss		117			119			—			—			29		45		—		44		15		—
Net periodic cost (benefit)		201			233			(37	)		57			123		165		44		135		210		184
Settlement expense		217			—			—			—			219		—		—		—		—		—
Amortization of pre-merger regulatory asset		—			—			571			698			—		—		—		—		6		6
Total periodic cost	$	418		$	233		$	534		$	755		$	342	$	165	$	44	$	135	$	216	$	190

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 nine 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 of $765,000 from the Chesapeake SERP. Also included in the $1.9 million pension and postretirement benefit costs for 2011 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 $6.1 million and $6.7 million at September 30, 2011 and December 31, 2010, respectively.

During the three and nine months ended September 30, 2011, we contributed $818,000 and $885,000, respectively, to the Chesapeake Pension Plan. We also contributed $466,000 and $1.0 million to the FPU Pension Plan during the three and nine months ended September 30, 2011, respectively. We expect to contribute $1.0 million 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 nine months ended September 30, 2011, were $22,000 and $67,000, respectively; for the year 2011, such benefits paid are expected to be approximately $853,000, which includes the 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 nine months ended September 30, 2011, totaled $22,000 and $68,000, 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 nine months ended September 30, 2011, totaled $72,000 and $107,000, 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 and the Chesapeake SERP. 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.