Pension Plans and Other Postretirement Benefits

3 Months Ended

Dec. 31, 2024

Retirement Benefits [Abstract]

Pension Plans and Other Postretirement Benefits

9. PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS

Pension Plans

Spire and the Utilities maintain pension plans for their employees.

Spire Missouri and Spire Alabama have non-contributory, defined benefit, trusteed forms of pension plans covering the majority of their employees. Qualified plan assets are comprised of mutual and commingled funds consisting of U.S. equities with varying strategies, global equities, alternative investments, and fixed income investments.

The net periodic pension cost includes components shown in the following tables. Service costs and regulatory adjustments are recorded in “Operation and maintenance” expenses while other components are presented in “Other Income, Net” in the income statement, except for Spire Alabama’s losses on lump-sum settlements. Such losses are capitalized in regulatory balances and amortized over the remaining actuarial life of individuals in the plan, and that amortization is presented in “Other Income, Net.”

	Three Months Ended December 31,
	2024			2023
Spire
Service cost – benefits earned during the period	$	4.5		$	4.0
Interest cost on projected benefit obligation		6.0			6.8
Expected return on plan assets		(6.5	)		(6.3	)
Amortization of prior service credit		(1.1	)		(1.1	)
Amortization of actuarial loss		1.6			1.6
Subtotal		4.5			5.0
Regulatory adjustment		8.9			8.7
Net pension cost	$	13.4		$	13.7
Spire Missouri
Service cost – benefits earned during the period	$	2.9		$	2.6
Interest cost on projected benefit obligation		4.0			4.8
Expected return on plan assets		(4.5	)		(4.3	)
Amortization of prior service credit		(0.5	)		(0.5	)
Amortization of actuarial loss		1.0			1.5
Subtotal		2.9			4.1
Regulatory adjustment		7.4			6.3
Net pension cost	$	10.3		$	10.4
Spire Alabama
Service cost – benefits earned during the period	$	1.4		$	1.2
Interest cost on projected benefit obligation		1.3			1.3
Expected return on plan assets		(1.3	)		(1.2	)
Amortization of prior service credit		(0.6	)		(0.6	)
Amortization of actuarial loss		0.6			0.2
Subtotal		1.4			0.9
Regulatory adjustment		1.3			2.2
Net pension cost	$	2.7		$	3.1

Pursuant to the provisions of Spire Missouri’s and Spire Alabama’s pension plans, pension obligations may be satisfied by monthly annuities, lump-sum cash payments, or special termination benefits. Lump-sum payments are recognized as settlements (which can result in gains or losses) only if the total of such payments exceeds the sum of service and interest costs in a specific year. Special termination benefits, when offered, are also recognized as settlements which can result in gains or losses. For the three months ended December 31, 2024 and 2023, no plans met the criteria for settlement accounting.

The funding policy of the Utilities is to contribute an amount not less than the minimum required by government funding standards, nor more than the maximum deductible amount for federal income tax purposes. Fiscal 2025 contributions to Spire Missouri’s pension plans through December 31, 2024 were $22.3 to the qualified trusts and none to non-qualified plans. Fiscal 2025 contributions to the Spire Alabama pension plans through December 31, 2024 were $2.6. Contributions totaling $13.2 to the qualified trusts of Spire Missouri’s pension plans are anticipated for the remainder of fiscal 2025. Contributions to Spire Alabama’s pension plans for the remainder of fiscal 2025 are anticipated to be $11.9.

Other Postretirement Benefits

Spire and the Utilities provide certain life insurance benefits at retirement. Spire Missouri plans provide for medical insurance after early retirement until age 65. For retirements prior to January 1, 2015, certain Spire Missouri plans provided medical insurance after retirement until death. The Spire Alabama plans provide medical insurance upon retirement until death for certain retirees depending on the type of employee and the date the employee was originally hired.

The net periodic postretirement benefit cost includes components shown in the following tables. Service costs and regulatory adjustments are recorded in “Operation and maintenance” expenses while other components are presented in “Other Income, Net” in the income statement, except in the event Spire Alabama incurs losses on lump-sum settlements. Any such losses are capitalized in regulatory balances and amortized over the remaining actuarial life of individuals in the plan, and that amortization is presented in “Other Income, Net.”

	Three Months Ended December 31,
	2024			2023
Spire
Service cost – benefits earned during the period	$	1.1		$	1.1
Interest cost on accumulated postretirement benefit obligation		1.8			2.1
Expected return on plan assets		(4.2	)		(4.0	)
Amortization of prior service cost		—			0.1
Amortization of actuarial gain		(1.5	)		(1.0	)
Subtotal		(2.8	)		(1.7	)
Regulatory adjustment		1.1			0.2
Net postretirement benefit income	$	(1.7	)	$	(1.5	)
Spire Missouri
Service cost – benefits earned during the period	$	0.9		$	0.9
Interest cost on accumulated postretirement benefit obligation		1.3			1.6
Expected return on plan assets		(2.8	)		(2.7	)
Amortization of prior service cost		0.1			0.2
Amortization of actuarial gain		(1.3	)		(0.9	)
Subtotal		(1.8	)		(0.9	)
Regulatory adjustment		1.6			0.6
Net postretirement benefit income	$	(0.2	)	$	(0.3	)
Spire Alabama
Service cost – benefits earned during the period	$	0.2		$	0.2
Interest cost on accumulated postretirement benefit obligation		0.5			0.5
Expected return on plan assets		(1.3	)		(1.3	)
Amortization of prior service credit		(0.1	)		(0.1	)
Subtotal		(0.7	)		(0.7	)
Regulatory adjustment		(0.5	)		(0.4	)
Net postretirement benefit income	$	(1.2	)	$	(1.1	)

Missouri and Alabama state laws provide for the recovery in rates of costs accrued pursuant to GAAP provided that such costs are funded through an independent, external funding mechanism. The Utilities have established Voluntary Employees’ Beneficiary Association (VEBA) and Rabbi Trusts as external funding mechanisms. The assets of the VEBA and Rabbi Trusts consist primarily of money market securities and mutual funds invested in stocks and bonds.

The Utilities’ funding policy is to contribute amounts to the trusts equal to the periodic benefit cost calculated pursuant to GAAP as recovered in rates. There have been no contributions to the postretirement plans through December 31, 2024 for Spire Missouri or Spire Alabama, and none are expected to be required for the remainder of the fiscal year.