Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

The following tables provide: (a) the components of income tax expense in 2012, 2011, and 2010; (b) the reconciliation between the statutory federal income tax rate and the effective income tax rate for 2012, 2011, and 2010; and (c) the components of accumulated deferred income tax assets and liabilities at December 31, 2012 and 2011.


For the Years Ended December 31,	2012			2011			2010
(in thousands)
Current Income Tax Expense
Federal	$	3,483		$	0		$	1,566
State		1,990			742			2,116
Investment tax credit adjustments, net		(58	)		(73	)		(91	)

Total current income tax expense		5,415			669			3,591

Deferred Income Tax Expense ⁽¹⁾
Property, plant and equipment		14,301			16,885			16,964
Deferred gas costs		515			591			(2,505	)
Pensions and other employee benefits		553			786			(402	)
FPU merger related premium cost and deferred gain		(509	)		—			(13	)
Amortization of intangibles		80			17			(211	)
Environmental expenditures		(82	)		(65	)		32
Net operating loss carryforwards		740			(1,000	)		99
Reserve for insurance deductibles		—			18			(419	)
Other		(1,717	)		88			(213	)

Total deferred income tax expense		13,881			17,320			13,332

Total Income Tax Expense	$	19,296		$	17,989		$	16,923

⁽¹⁾	Includes $1,934,000, $2,280,000, and $1,963,000 of deferred state income taxes for the years 2012, 2011 and 2010, respectively.

Summary of Reconciliation of Statutory Federal Tax and Effective Income Tax Rates

Reconciliation of Effective Income Tax Rates
Continuing Operations
Federal income tax expense (2)	$	16,745		$	16,146		$	15,053
State income taxes, net of federal benefit		2,659			2,216			2,083
Merger related costs		—			—			70
ESOP dividend deduction		(235	)		(236	)		(266	)
Other		127			(137	)		(17	)

Total income tax expense	$	19,296		$	17,989		$	16,923

Effective income tax rate		40.07	%		39.44	%		39.38	%

⁽²⁾	Federal income taxes were recorded at 35% for each year represented.

Schedule of Accumulated Deferred Income Tax Assets and Liabilities



At December 31,	2012		2011
(in thousands)
Deferred Income Taxes
Deferred income tax liabilities:
Property, plant and equipment	$	118,212	$	105,850
Acquisition adjustment		17,440		18,090
Deferred gas costs		816		301
Loss on reacquired debt		572		608
Other		2,784		3,872

Total deferred income tax liabilities		139,824		128,721

Deferred income tax assets:
Pension and other employee benefits		7,382		7,796
Environmental costs		1,917		1,835
Net operating loss carryforwards		1,587		2,401
Self insurance		484		452
Storm reserve liability		1,058		1,085
Other		2,982		2,240

Total deferred income tax assets		15,410		15,809

Deferred Income Taxes Per Consolidated Balance Sheet	$	124,414	$	112,912