Fair Value Disclosures

12 Months Ended

Dec. 31, 2012

Notes To Financial Statements [Abstract]

Fair Value Disclosures

NOTE 6:  FAIR VALUE OF FINANCIAL INSTRUMENTS

FASB ASC 820, “Fair Value Measurements and Disclosures” (“FASB ASC 820”) provides enhanced guidance for using fair value to measure assets and liabilities and expands disclosure with respect to fair value measurements.

FASB ASC 820 establishes a fair value hierarchy that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs).  The hierarchy consists of three broad levels, as follows:

Level 1 – Quoted market prices in active markets for identical assets or liabilities.

Level 2 – Inputs other than Level 1 that are either directly or indirectly observable.

Level 3 – Unobservable inputs developed using the Company’s estimates and assumptions, which reflect those that the Company believes market participants would use.

The following table summarizes our financial instruments measured at fair value on a recurring basis within the fair value hierarchy as of December 31, 2012.  These instruments are included in Other Property and Investments on the Company’s Consolidated Balance Sheets:

(in thousands)	Level 1		Level 2		Level 3		Total
Asset Type:
Company owned life insurance	$	—	$	2,538	$	—	$	2,538
Money Market Fund	28		—		—		28
Mutual Funds:
Equity Funds (1)	1,046		—		—		1,046
Total	$	1,074	$	2,538	$	—	$	3,612

The following table summarizes our financial instruments measured at fair value on a recurring basis within the fair value hierarchy as of December 31, 2011.  These instruments are included in Other Property and Investments on the Company’s Consolidated Balance Sheets:

(in thousands)	Level 1		Level 2		Level 3		Total
Asset Type:
Company owned life insurance	$	—	$	2,269	$	—	$	2,269
Money Market Fund	28		—		—		28
Mutual Funds:
Equity Funds (1)	852		—		—		852
Total	$	880	$	2,269	$	—	$	3,149

(1) Mutual funds consisting primarily of equity securities.

The fair value of Company owned life insurance is based on the cash surrender value of the contracts. These contracts are based principally on a referenced pool of investment funds that actively redeem shares and are observable and measurable.

The following methods and assumptions were used to estimate the fair value of each of the following financial instruments, which are not reported at market value on the financial statements.

CASH AND CASH EQUIVALENTS – Cash equivalents consist of highly liquid instruments with original maturities at the time of purchase of three months or less.  The carrying amount approximates fair value.

RESTRICTED CASH – As part of the December 2011 bond offerings, described in Note 7 to the Notes to the Consolidated Financial Statements, the Company recorded unused proceeds from these bond issuances as restricted cash as the funds can only be used for certain capital expenditures.  The Company expects to use the remainder of the 2011 proceeds during 2013, as the approved capital expenditures are completed.  The carrying amount approximates fair value.

LONG-TERM DEBT – The fair value of the Company's fixed rate long-term debt is based upon borrowing rates currently available to the Company and similar marketable securities.  As of December 31, 2012 and 2011, the estimated fair value of the Company's long-term debt was $194,900,000 and $135,084,000, respectively, as compared to the carrying amounts of $178,475,000 and $135,256,000, respectively. Under the fair value hierarchy, long-term debt has been categorized as Level 2 because the valuations are calculated using models which utilize active trading market data which the Company can corroborate.

The fair values shown above have been reported to meet the disclosure requirements of FASB ASC 825, “Financial Instruments” (“FASB ASC 825”) and do not purport to represent the amounts at which those obligations would be settled.