XML 48 R32.htm IDEA: XBRL DOCUMENT

RETIREMENT BENEFITS (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of the Company's benefit plans' projected benefit obligations

	Pension						SERP						OPEB

	2012			2011			2012			2011			2012			2011
Benefit obligation at beginning of year	$	215,088		$	186,840		$	4,863		$	2,895		$	83,226		$	80,938
Service cost		6,261			5,596			51			93			2,401			2,266
Interest cost		10,258			10,405			263			183			4,037			4,383
Net actuarial (gain)/loss		25,882			20,869			1,511			1,883			6,955			(2,136	)
Plan participant's contribution		—			—			—			—			910			863
Benefits and expenses paid		(9,485	)		(8,622	)		(323	)		(191	)		(3,156	)		(3,261	)
Federal subsidy		—			—			—			—			365			173

Benefit obligation at end of year	$	248,004		$	215,088		$	6,365		$	4,863		$	94,738		$	83,226

Schedule of fair value of the plans' assets

	Pension						SERP				OPEB

	2012			2011			2012		2011		2012			2011
Fair value of plan assets at beginning of year	$	140,975		$	120,353		$	—	$	—	$	58,384		$	56,730
Actual return on plan assets — gain/(loss)		17,562			(625	)		—		—		7,148			279
Employer contribution		11,123			29,869			—		—		3,970			3,544
Benefits paid		(9,485	)		(8,622	)		—		—		(3,045	)		(3,160	)
Plan participant's contribution		—			—			—		—		864			826
Federal subsidy		—			—			—		—		346			165

Fair value of plan assets at end of year	$	160,175		$	140,975		$	—	$	—	$	67,667		$	58,384

Schedule of the funded status

	Pension						SERP						OPEB

	2012			2011			2012			2011			2012			2011
Fair value of plan assets	$	160,175		$	140,975		$	—		$	—		$	67,667		$	58,384
Projected benefit obligations		(248,004	)		(215,088	)		(6,365	)		(4,863	)		(94,738	)		(83,226	)

Funded status	$	(87,829	)	$	(74,113	)	$	(6,365	)	$	(4,863	)	$	(27,071	)	$	(24,842	)

Schedule of employee pension plan accumulated benefit obligation

The employee pension plan accumulated benefit obligation at December 31, 2012 and 2011 is presented in the following table (in thousands):

	Pension Benefits				SERP

	2012		2011		2012		2011
Accumulated benefit obligation	$	219,659	$	191,295	$	6,014	$	4,670

Schedule of amounts recognized in the balance sheet

Amounts recognized in the balance sheet consist of (in thousands):

	Pension				SERP				OPEB

	2012		2011		2012		2011		2012		2011
Accounts Payable and Accrued Liabilities	$	—	$	—	$	313	$	311	$	144	$	136
Pension and other postretirement benefit obligation	$	87,829	$	74,113	$	6,052	$	4,552	$	26,927	$	24,706

Schedule of net periodic benefit pension cost

Net periodic benefit pension cost for 2012, 2011 and 2010, some of which is capitalized as a component of labor cost and some of which is deferred as a regulatory asset (see Note 3), is comprised of the following components (in thousands):

Net Periodic Pension Benefit Cost:

	Pension									OPEB

	2012			2011			2010			2012			2011			2010
Service cost	$	6,261		$	5,596		$	4,887		$	2,401		$	2,266		$	2,138
Interest cost		10,258			10,405			10,115			4,037			4,383			4,329
Expected return on plan assets		(12,309	)		(11,139	)		(9,847	)		(4,135	)		(4,157	)		(3,844	)
Amortization of prior service cost⁽¹⁾		531			532			531			(1,011	)		(1,011	)		(1,011	)
Amortization of actuarial loss⁽¹⁾		7,935			5,494			3,996			1,661			1,762			1,499

Net periodic benefit cost	$	12,676		$	10,888		$	9,682		$	2,953		$	3,243		$	3,111

Net Periodic Pension Benefit Cost:

	SERP

	2012			2011			2010
Service cost	$	51		$	93		$	70
Interest cost		263			183			153
Expected return on plan assets		—			—			—
Amortization of prior service cost⁽¹⁾		(8	)		(8	)		(8	)
Amortization of actuarial loss⁽¹⁾		389			171			96

Net periodic benefit cost	$	695		$	439		$	311

(1): Amounts are amortized from our regulatory asset originally recorded upon recognizing our net pension liability on the balance sheet.

Schedule of activity in the regulatory asset accounts

The tables below present the activity in the regulatory asset accounts for the year (in thousands).

			Amount Recognized

Regulatory Assets	Beginning Balance 12/31/11		Current Year Actuarial Loss		Amortization of Actuarial Loss			Amortization of Prior Service (Cost)/Credit			Ending Balance 12/31/12
Pension	$	93,656		20,628		(7,935	)		(531	)	$	105,818
SERP	$	3,012		1,512		(389	)		8		$	4,143
OPEB	$	17,020		3,941		(1,661	)		1,011		$	20,311

Schedule of net actuarial gains / losses, transition obligations / assets and prior period service costs in regulatory assets not yet recognized as a component of net periodic benefit cost and the amounts expected to be recognized in the subsequent year

The following table presents those items for the employee pension plan and other benefits plan at December 31, 2012, and the subsequent twelve-month period (in thousands):

	Pension Benefits				SERP						OPEB

	2012		Subsequent Period		2012			Subsequent Period			2012			Subsequent Period
Net actuarial loss	$	103,838	$	10,361	$	4,174		$	416		$	24,917		$	2,598
Prior service cost (benefit)		1,980		531		(31	)		(8	)		(4,606	)		(1,011	)

Total	$	105,818	$	10,892	$	4,143		$	408		$	20,311		$	1,587

Schedule of assumptions used to determine the benefit obligation

	Pension Benefits						OPEB

	2012			2011			2012			2011
Discount rate		4.00	%		4.70	%		4.11	%		4.90	%
Rate of compensation increase		3.50	%		3.50	%		3.50	%		3.50	%

Schedule of assumptions used to determine the periodic costs

	Pension Benefits									OPEB

	2012			2011			2010			2012			2011			2010
Discount rate		4.70	%		5.50	%		6.00	%		4.90	%		5.50	%		6.00	%
Expected return on plan assets		7.90	%		8.00	%		8.00	%		6.65	%		7.00	%		7.00	%
Rate of compensation increase		3.50	%		4.50	%		4.50	%		3.50	%		4.50	%		4.50	%

Pensions

Retirement benefits

Schedule of expected benefit payments

Expected benefit payments are as follows (in millions):

Year	Payments from Trust		Payments from Company Funds

2013	$	10.1	$	0.3
2014		10.8		0.3
2015		11.5		0.3
2016		12.1		0.3
2017		12.6		0.3
2018 – 2022		71.2		1.6

Schedule of fund assets measured at fair value

The following fair value hierarchy table presents information about the pension fund assets measured at fair value as of December 31, 2012 and December 31, 2011 (in thousands):

	Fair Value Measurements as of December 31, 2012

	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Percentage of Plan Assets
Short term investments	$	—	$	2,398	$	—	$	2,398		1.5	%
Equity securities
U.S. equity		63,655		—		—		63,655		39.7	%
International equity		22,074		—		—		22,074		13.8	%
Fixed income
Common collective trust		—		26,110		—		26,110		16.3	%
U.S. corporate debt		—		15,518		—		15,518		9.7	%
U.S. government debt		1,535		—		—		1,535		1.0	%
Other types of investments
Equity long/short hedge funds		—		—		28,885		28,885		18.0	%

	$	87,264	$	44,026	$	28,885	$	160,175		100.0	%

	Fair Value Measurements as of December 31, 2011

	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Percentage of Plan Assets
Short term investments	$	—	$	1,787	$	—	$	1,787		1.2	%
Equity securities
U.S. equity		57,228		—		—		57,228		40.6	%
International equity		19,151		—		—		19,151		13.6	%
Fixed income
Common collective trust		—		22,904		—		22,904		16.3	%
U.S. corporate debt		—		11,692		—		11,692		8.3	%
U.S. government debt		794		—		—		794		0.6	%
Other types of investments
Equity long/short hedge funds		—		—		27,419		27,419		19.4	%

	$	77,173	$	36,383	$	27,419	$	140,975		100.0	%

Schedule of fair value measurements using significant unobservable inputs (level 3)

	2012		2011

	Equity long/short hedge funds		Equity long/short hedge funds
Beginning Balance, January 1,	$	27,419	$	22,338
Actual return on plan assets:
Relating to assets still held at the reporting date		1,466		(669	)
Relating to assets sold during the period		—		—
Purchases		—		5,750
Sales		—		—
Settlements		—		—
Transfers into and (out of) Level 3		—		—

Ending Balance, December 31,	$	28,885	$	27,419

Schedule of permissible investments

Permissible Investments

Equity Oriented		Fixed Income Oriented and Real Estate

•	Common Stocks	•	Bonds
•	Preferred Stocks	•	GICs, BICs
•	Convertible Preferred Stocks	•	Corporate Bonds (minimum quality rating
•	Convertible Bonds		of Baa or BBB)
•	Covered Options	•	Cash-Equivalent Securities (e.g., U.S.
•	Hedged Equity Funds of Funds		T-Bills, Commercial Paper, etc.)
		•	Certificates of Deposit in institutions with FDIC/FSLIC protection
		•	Money Market Funds / Bank STIF Funds
		•	Real Estate — Publicly Traded

The above assets can be held in commingled (mutual) funds as well as privately managed separate accounts.

Those investments prohibited by the Investment Committee without prior approval are:

Prohibited Investments Requiring Pre-approval


•	Privately Placed Securities	•	Warrants
•	Commodities Futures	•	Short Sales
•	Securities of Empire District	•	Index Options

OPEB

Retirement benefits

Schedule of expected benefit payments

Estimated benefit payments are as follows (in millions):

Year	Payments from Trust		Expected Federal Subsidy		Payments from Company Funds

2013	$	2.5	$	0.3	$	0.1
2014		2.8		0.3		0.2
2015		3.1		0.4		0.2
2016		3.4		0.4		0.2
2017		3.8		0.5		0.2
2018 – 2022		22.7		3.1		0.9

Schedule of effect of 1% change in assumed healthcare cost growth rates

The healthcare cost trend rate affects projected benefit obligations. A 1% change in assumed healthcare cost growth rates would have the following effects (in thousands):

	1% Increase		1% Decrease

Effect on total of service and interest cost	$	1,285	$	(1,001	)
Effect on post-retirement benefit obligation	$	14,789	$	(11,882	)

Schedule of fund assets measured at fair value

The following fair value hierarchy table presents information about the OPEB fund assets measured at fair value as of December 31, 2012 and December 31, 2011 (in thousands):

	Fair Value Measurements as of December 31, 2012

	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Percentage of Plan Assets
Cash and cash equivalents	$	895	$	—	$	—	$	895		1.3	%
Fixed income
U.S. government debt		729		—		—		729		1.1	%
U.S. corporate debt		—		19,437		—		19,437		28.7	%
Foreign debt		—		2,250		—		2,250		3.3	%
Mutual funds — fixed income		3,914		—		—		3,914		5.8	%
Equity securities
U.S. equity		20,795		—		—		20,795		30.7	%
International equity		1,548		—		—		1,548		2.3	%
Mutual funds — equity		17,818		—		—		17,818		26.3	%

	$	45,699	$	21,687	$	—		67,836

Accrued interest & dividends								281		0.5	%

							$	67,667		100	%

	Fair Value Measurements as of December 31, 2011

	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Percentage of Plan Assets
Cash and cash equivalents	$	1,536	$	—	$	—	$	1,536		2.6	%
Fixed income
U.S. government debt		1,839		—		—		1,839		3.1	%
U.S. corporate debt		—		17,232		—		17,232		29.5	%
Foreign debt		—		1,460		—		1,460		2.5	%
Mutual funds — fixed income		2,107		—		—		2,107		3.6	%
Equity securities
U.S. equity		21,080		—		—		21,080		36.1	%
International equity		1,784		—		—		1,784		3.1	%
Mutual funds — equity		11,075		—		—		11,075		19.0	%

	$	39,421	$	18,692		—		58,113

Accrued interest & dividends								271		0.5	%

							$	58,384		100	%

Schedule of permissible investments

Permissible Investments

Equity		Fixed Income

•	Common Stocks	•	Cash-Equivalent Securities with a maturity
•	Preferred Stocks		of one-year or less
		•	Bonds
		•	Money Market Funds / Bank STIF Funds
		•	Certificates of Deposit in institutions with FDIC protection
		•	Corporate Bonds (minimum quality rating of A)

The above assets can be held in commingled (mutual) funds as well as privately managed separate accounts.

Listed below are those investments prohibited by the Investment Committee:

Prohibited Investments


•	Privately Placed Securities	•	Margin Transactions
•	Commodities Futures	•	Short Sales
•	Securities of Empire District	•	Index Options
•	Derivatives	•	Real Estate and Real Property
•	Instrumentalities in violation of the Prohibited Transactions Standards of ERISA	•	Restricted Stock