EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Sep. 30, 2018

Summary of Changes in Funded Status of Plans and Liabilities Recognized

The following summarizes the changes in the funded status of the plans and the related liabilities recognized on the Consolidated Balance Sheets as of September 30:



	Pension ⁽¹⁾						OPEB
(Thousands)	2018			2017			2018			2017
Change in Benefit Obligation
Benefit obligation at beginning of year	$	297,835		$	293,654		$	175,090		$	160,393
Service cost	8,139			8,347			4,607			4,380
Interest cost	10,493			9,771			6,365			5,545
Plan participants’ contributions ⁽²⁾	45			45			161			120
Special termination benefits ⁽³⁾	3,730			—			490			—
Actuarial (gain) loss	(12,846		)	(5,995		)	15,145			8,985
Benefits paid, net of retiree subsidies received	(8,821		)	(7,987		)	(5,073		)	(4,333		)
Benefit obligation at end of year	$	298,575		$	297,835		$	196,785		$	175,090
Change in plan assets
Fair value of plan assets at beginning of year	$	271,743		$	249,875		$	71,534		$	62,035
Actual return on plan assets	16,306			29,736			5,284			7,953
Employer contributions	137			74			6,222			6,049
Benefits paid, net of plan participants’ contributions ⁽²⁾	(8,776		)	(7,942		)	(5,060		)	(4,503		)
Fair value of plan assets at end of year	$	279,410		$	271,743		$	77,980		$	71,534
Funded status	$	(19,165	)	$	(26,092	)	$	(118,805	)	$	(103,556	)
Amounts recognized on Consolidated Balance Sheets
Postemployment employee (liability)
Current	$	(294	)	$	(158	)	$	(669	)	$	(602	)
Noncurrent	(18,871		)	(25,934		)	(118,136		)	(102,954		)
Total	$	(19,165	)	$	(26,092	)	$	(118,805	)	$	(103,556	)


(1)	Includes the Company’s PEP.


(2)	Prior to July 1, 1998, employees were eligible to elect an additional participant contribution to enhance their benefits and contributions made during the periods were insignificant.


(3)	Related to the voluntary early retirement program offered during fiscal 2018, as previously discussed.

Summary of Regulatory Assets and Accumulated Other Comprehensive Income

The following table summarizes the amounts recognized in regulatory assets and accumulated other comprehensive income as of September 30:



	Regulatory Assets						Accumulated Other Comprehensive Income (Loss)
	Pension			OPEB			Pension			OPEB
Balance at September 30, 2016	$	94,941		$	59,147		$	28,436		$	4,486
Amounts arising during the period:
Net actuarial (gain) loss	(9,429		)	5,211			(6,990		)	587
Amounts amortized to net periodic costs:
Net actuarial (loss)	(6,799		)	(4,209		)	(2,028		)	(160		)
Prior service (cost) credit	(108		)	311			(3		)	54
Balance at September 30, 2017	$	78,605		$	60,460		$	19,415		$	4,967
Amounts arising during the period:
Net actuarial (gain) loss	(6,090		)	12,378			(3,422		)	2,834
Amounts amortized to net periodic costs:
Net actuarial (loss)	(6,177		)	(4,464		)	(1,359		)	(196		)
Prior service (cost) credit	(105		)	311			(1		)	54
Balance at September 30, 2018	$	66,233		$	68,685		$	14,633		$	7,659

The amounts in regulatory assets and accumulated other comprehensive income not yet recognized as components of net periodic benefit cost as of September 30 are:



	Regulatory Assets										Accumulated Other Comprehensive Income (Loss)
	Pension				OPEB						Pension				OPEB
(Thousands)	2018		2017		2018			2017			2018		2017		2018			2017
Net actuarial loss	$	65,664	$	77,930	$	69,477		$	61,563		$	14,633	$	19,414	$	7,750		$	5,113
Prior service cost (credit)	569		675		(792		)	(1,103		)	—		1		(91		)	(146		)
Total	$	66,233	$	78,605	$	68,685		$	60,460		$	14,633	$	19,415	$	7,659		$	4,967

Schedule of Amounts Expected to be Recognized as Components of Net Periodic Benefit Cost

Amounts included in regulatory assets and accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost in fiscal 2019 are as follows:



	Regulatory Assets					Accumulated Other Comprehensive Income (Loss)
(Thousands)	Pension		OPEB			Pension		OPEB
Net actuarial loss	$	4,662	$	5,527		$	1,103	$	643
Prior service cost (credit)	102		(312		)	—		(53		)
Total	$	4,764	$	5,215		$	1,103	$	590

Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets

The accumulated benefit obligation for the pension plans, including the PEP, exceeded the fair value of plan assets. The projected benefit and accumulated benefit obligations and the fair value of plan assets as of September 30, are as follows:



	Pension
(Thousands)	2018		2017
Projected benefit obligation	$	298,575	$	297,835
Accumulated benefit obligation	$	263,279	$	258,514
Fair value of plan assets	$	279,410	$	271,743

Components of Net Periodic Cost

The components of the net periodic cost for pension benefits, including the Company’s PEP, and OPEB costs (principally health care and life insurance) for employees and covered dependents for fiscal years ended September 30, are as follows:



	Pension									OPEB
(Thousands)	2018			2017			2016			2018			2017			2016
Service cost	$	8,139		$	8,347		$	7,591		$	4,607		$	4,380		$	4,521
Interest cost	10,493			9,771			11,342			6,365			5,545			6,256
Expected return on plan assets	(19,639		)	(19,313		)	(20,118		)	(5,352		)	(4,767		)	(4,845		)
Recognized actuarial loss	7,537			8,827			7,281			4,660			4,370			3,274
Prior service cost (credit) amortization	106			111			111			(365		)	(365		)	(365		)
Net periodic benefit cost	$	6,636		$	7,743		$	6,207		$	9,915		$	9,163		$	8,841
Special termination benefit	3,730			—			—			490			—			—
Net periodic benefit cost recognized as expense	$	10,366		$	7,743		$	6,207		$	10,405		$	9,163		$	8,841

Schedule of Weighted Average Assumptions Used

The weighted average assumptions used to determine the Company’s benefit costs during the fiscal years below and obligations as of September 30, are as follows:

Pension

OPEB

2018

2017

2016

2018

2017

2016

Benefit costs:

Discount rate

4.04/4.03%

3.96/3.94%

4.50

4.12/4.08%

⁽¹⁾

4.08/4.01%

⁽¹⁾

4.60/4.55%

Expected asset return

7.50

7.75

8.75

7.50

7.75

8.75

Compensation increase

3.25/3.50%

⁽¹⁾

3.25/3.50%

⁽¹⁾

3.25/3.50%

⁽¹⁾

3.25/3.50%

3.50

Obligations:

Discount rate

4.36/4.35%

4.03

⁽¹⁾

3.96/3.94%

4.38/4.37%

⁽¹⁾

4.12/4.08%

⁽¹⁾

4.08/4.01%

⁽¹⁾

Compensation increase

3.25/3.50%

⁽¹⁾

3.25/3.50%

⁽¹⁾

3.25/3.50%

⁽¹⁾

3.25/3.50%

⁽¹⁾

3.25/3.50%

3.50


(1)	Percentages for represented and nonrepresented plans, respectively.

Information on Assumed HCCTR Used to Determine Expected OPEB Benefits

Information relating to the assumed HCCTR used to determine expected OPEB benefits as of September 30, and the effect of a 1 percent change in the rate, are as follows:



($ in thousands)	2018			2017			2016
HCCTR	7.9		%	8.3		%	8.5		%
Ultimate HCCTR	4.5		%	4.5		%	4.5		%
Year ultimate HCCTR reached	2024			2025			2025
Effect of a 1 percentage point increase in the HCCTR on:
Year-end benefit obligation	$	36,260		$	32,019		$	28,803
Total service and interest cost	$	2,482		$	2,468		$	2,331
Effect of a 1 percentage point decrease in the HCCTR on:
Year-end benefit obligation	$	(28,743	)	$	(25,466	)	$	(22,862	)
Total service and interest costs	$	(1,937	)	$	(1,909	)	$	(1,801	)

Schedule of Mix and Targeted Allocation of Plan Assets

The mix and targeted allocation of the pension and OPEB plans’ assets are as follows:



	2019		Assets at
	Target		September 30,
Asset Allocation	Allocation		2018		2017
U.S. equity securities	34	%	41	%	39	%
International equity securities	17		19		21
Fixed income	41		37		40
Other assets	8		3		—
Total	100	%	100	%	100	%

Schedule of Expected Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the following fiscal years:



(Thousands)	Pension		OPEB
2019	$	10,320	$	5,450
2020	$	11,769	$	6,512
2021	$	12,399	$	7,096
2022	$	13,239	$	7,810
2023	$	14,217	$	8,413
2024 - 2028	$	85,426	$	50,869

Schedule of Estimated Subsidy Payments

The following estimated subsidy payments are expected to be paid during the following fiscal years:



	Estimated Subsidy
(Thousands)	Payment
2019		$	280
2020		$	316
2021		$	347
2022		$	375
2023		$	417
2024 - 2028		$	2,787

Summary of Pension and OPEB Assets Held in the Master Trust

Pension and OPEB assets held in the master trust, measured at fair value, as of September 30, are summarized as follows:



	Quoted Prices in Active Markets for Identical Assets (Level 1)
(Thousands)	Pension				OPEB
Assets	2018		2017		2018		2017
Money market funds	$	8,207	$	—	$	2,273	$	11
Registered Investment Companies:
Equity Funds:
Large Cap Index	97,016		88,321		27,340		23,986
Extended Market Index	17,741		16,329		5,014		4,409
International Stock	53,516		56,446		14,874		15,000
Fixed Income Funds:
Emerging Markets	11,754		13,516		3,264		3,551
Core Fixed Income	—		—		7,970		8,082
Opportunistic Income	—		—		4,798		4,744
Ultra Short Duration	—		—		4,830		4,673
High Yield Bond Fund	25,720		26,540		7,236		7,078
Long Duration Fund	64,039		70,591		—		—
Total assets	$	277,993	$	271,743	$	77,599	$	71,534