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EMPLOYEE BENEFIT PLANS
 12 Months Ended
Sep. 30, 2025
Retirement Benefits [Abstract]  
EMPLOYEE BENEFIT PLANS
11. EMPLOYEE BENEFIT PLANS

Pension and Other Postemployment Benefit Plans

The Company has two trusteed, noncontributory defined benefit retirement plans covering eligible regular represented and non-represented employees with more than one year of service. Defined benefit plan benefits are based on years of service and average compensation during the highest 60 consecutive months of employment. The Company also provides postemployment medical and life insurance benefits to employees who meet certain eligibility requirements.

All represented employees of NJRHS hired on or after October 1, 2000, non-represented employees hired on or after October 1, 2009 and NJNG represented employees hired on or after January 1, 2012 are covered by an enhanced defined contribution plan instead of the defined benefit plan. Participation in the postemployment medical and life insurance plan was also frozen to new employees as of the same dates, with the exception of new NJRHS represented employees, for which benefits were frozen beginning April 3, 2012.

The Company maintains an unfunded nonqualified PEP that was established to provide employees with the full level of benefits as stated in the qualified plan without reductions due to various limitations imposed by the provisions of federal income tax laws and regulations. There are no plan assets in the nonqualified plan due to the nature of the plan.

The Company’s funding policy for its pension plans is to contribute at least the minimum amount required by the Employee Retirement Income Security Act of 1974, as amended. In fiscal 2025 and 2024, the Company had no minimum funding requirements and did not make any discretionary contributions to the pension plans. The Company does not expect to be required to make additional contributions to fund the pension plans during the next fiscal year based on current actuarial assumptions; however, funding requirements are uncertain and can depend significantly on changes in actuarial assumptions, returns on plan assets and changes in the demographics of eligible employees and covered dependents.

There are no federal requirements to pre-fund OPEB benefits. However, the Company is required to fund certain amounts due to regulatory agreements with the BPU. The Company contributed approximately $0.5M and $7.8M in fiscal 2025 and 2024, respectively, and estimates that it may contribute up to $3.0M over each of the next five years. Additional contributions may be required based on market conditions and changes to assumptions.

In January 2024, the Company announced changes to its postretirement medical benefits plan. Beginning on January 1, 2025, the Company replaced the existing retiree medical coverage for certain eligible employees age 65 and older and their Medicare-eligible dependents with an employer-funded Health Reimbursement Arrangement. Medicare-eligible participants may use the Health Reimbursement Arrangement toward the purchase of supplemental insurance coverage and for other qualified medical expenses. The liability associated with postretirement medical benefits was remeasured as of January 1, 2024. The change in post-retirement medical benefits is being amortized into earnings over approximately eight years, the average remaining service to retirement for all plan participants.
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)2025202420252024
Change in Benefit Obligation
Benefit obligation at beginning of year$333,532 $290,321 $181,800 $203,406 
Service cost5,523 4,976 1,092 1,406 
Interest cost15,433 16,240 8,387 8,327 
Plan amendments— — — (79,881)
Plan participants’ contributions (2)
20 27 1,401 703 
Actuarial (gain) loss(12,216)36,863 39,942 54,518 
Benefits paid, net of retiree subsidies received(16,838)(14,895)(7,808)(6,679)
Benefit obligation at end of year$325,454 $333,532 $224,814 $181,800 
Change in plan assets
Fair value of plan assets at beginning of year$342,710 $298,361 $129,721 $106,783 
Actual return on plan assets28,156 58,682 12,063 21,249 
Employer contributions539 535 486 7,846 
Reimbursement from Trust (3)
— — (9,139)— 
Benefits paid, net of plan participants’ contributions (2)
(16,819)(14,868)(6,538)(6,157)
Fair value of plan assets at end of year$354,586 $342,710 $126,593 $129,721 
Funded status$29,132 $9,178 $(98,221)$(52,079)
Amounts recognized on Consolidated Balance Sheets
Postemployment employee benefit asset
Noncurrent$40,813 $21,104 $— $3,556 
Postemployment employee benefit liability
Current$(555)$(552)$(517)$(2,400)
Noncurrent(11,126)(11,374)(97,704)(53,235)
Total$29,132 $9,178 $(98,221)$(52,079)
(1)Includes the Company’s PEP.
(2)Contributions made by employees hired prior to July 1, 1998, who were eligible to elect an additional participant contribution to enhance their benefits, were immaterial during the periods.
(3)Reimbursements for benefit premiums paid by the Company on behalf of the Trust.

The Company recognizes a liability for its underfunded benefit plans as required by ASC 715, Compensation - Retirement Benefits. The Company records the offset to regulatory assets for the portion of liability relating to NJNG and to accumulated OCI for the portion of the liability related to its unregulated operations. The increase in actuarial gain for the pension and the decrease in actuarial loss for the OPEB were due primarily to the increase in the discount rate during fiscal 2025 compared with fiscal 2024 .
The following table summarizes the amounts recognized in regulatory assets and accumulated OCI as of September 30:
Regulatory AssetsAccumulated Other Comprehensive Income (Loss)
(Thousands)PensionOPEBPensionOPEB
Balance at September 30, 2023$24,638 $30,046 $742 $5,498 
Amounts arising during the period:
Net actuarial (gain) loss(2,407)27,108 934 14,080 
Prior service (credit)— (60,504)— (19,376)
Amounts amortized to net periodic costs:
Net actuarial gain (loss)2 (3,098)(119)(1,164)
Prior service (cost) credit(61)7,458 — 2,555 
Balance at September 30, 2024$22,172 $1,010 $1,557 $1,593 
Amounts arising during the period:
Net actuarial (gain) loss(13,368)27,178 (3,303)10,086 
Amounts amortized to net periodic costs:
Net actuarial (loss)(994)(5,114)(209)(2,057)
Prior service credit— 9,801 — 3,279 
Balance at September 30, 2025$7,810 $32,875 $(1,955)$12,901 

The amounts in regulatory assets and accumulated OCI not yet recognized as components of net periodic benefit cost as of September 30 are:
Regulatory AssetsAccumulated Other Comprehensive
Income (Loss)
PensionOPEBPensionOPEB
(Thousands)20252024202520242025202420252024
Net actuarial loss (gain)$7,810 $22,172 $76,120 $54,056 $(1,955)$1,557 $26,443 $18,414 
Prior service cost (credit)— — (43,245)(53,046)— — (13,542)(16,821)
Total$7,810 $22,172 $32,875 $1,010 $(1,955)$1,557 $12,901 $1,593 

To the extent the unrecognized amounts in accumulated OCI or regulatory assets exceed 10% of the greater of the benefit obligation or the fair value of plan assets, an amortized amount over the average expected future working lifetime of the active plan participants is recognized.

The projected benefit and accumulated benefit obligations and the fair value of plan assets as of September 30, are as follows:
Pension
(Thousands)20252024
Projected benefit obligation$325,454 $333,532 
Accumulated benefit obligation$302,880 $306,850 
Fair value of plan assets$354,586 $342,710 

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:
PensionOPEB
(Thousands)202520242023202520242023
Service cost$5,523 $4,976 $5,402 $1,092 $1,406 $2,471 
Interest cost15,433 16,240 15,174 8,387 8,327 9,146 
Expected return on plan assets(23,700)(20,346)(19,972)(9,385)(7,920)(6,721)
Recognized actuarial loss1,203 117 300 7,171 4,262 — 
Prior service cost (credit) amortization— 61 103 (13,080)(10,013)— 
Net periodic benefit cost recognized as expense$(1,541)$1,048 $1,007 $(5,815)$(3,938)$4,896 
Assumptions

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:
PensionOPEB
202520242023202520242023
Benefit costs:
Discount rate
5.01/4.99%
(1)
5.89/5.87%
(1)
5.50/5.50%
(1)
4.97/4.98%
(1)
5.97/5.94%
(1)
5.51/5.51%
(1)
Expected asset return7.50 %7.00 %7.00 %7.50 %7.00 %7.00 %
Compensation increase
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
Obligations:
Discount rate
5.46/5.43%
(1)
5.01/4.99%
(1)
5.89/5.87%
(1)
5.35/5.35%
(1)
4.97/4.98%
(1)
5.97/5.94%
(1)
Compensation increase
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
3.00/3.50%
(1)
(1)Percentages for represented and non-represented plans, respectively.

When measuring its PBO, the Company uses an aggregate discount rate at which its obligation could be effectively settled. The Company determines a single weighted average discount rate based on a yield curve comprised of rates of return on a population of high quality debt issuances (AA- or better) whose cash flows (via coupons or maturities) match the timing and amount of its expected future benefit payments. The Company measures its service and interest costs using a disaggregated, or spot rate, approach. The Company applies the duration-specific spot rates from the full yield curve, as of the measurement date, to each year’s future benefit payments, which aligns the timing of the plans’ separate future cash flows to the corresponding spot rates on the yield curve.

Information relating to the assumed HCCTR used to determine expected OPEB benefits as of September 30, is as follows:
($ in thousands)202520242023
HCCTR9.4%8.8%7.4%
Ultimate HCCTR4.5%4.5%4.5%
Year ultimate HCCTR reached203320322032

The Company’s investment objective is a long-term real rate of return on assets before permissible expenses that is approximately 5% greater than the assumed rate of inflation, as measured by the consumer price index. The expected long-term rate of return is based on the asset categories in which the Company invests and the current expectations and historical performance for these categories.

The mix and targeted allocation of the pension and OPEB plans’ assets are as follows:
2026Assets at
TargetSeptember 30,
Asset AllocationAllocation20252024
U.S. equity securities29 %30 %29 %
International equity securities16 16 16 
Fixed income39 37 38 
Collective investment trusts at NAV16 17 17 
Total100 %100 %100 %

The Company uses mortality assumptions published by the Society of Actuaries for its pension and other postemployment benefit obligations, which reflects life expectancies in the U.S. The Company used projection scale MP-2021 and the Pri-2012 mortality study as of September 30, 2025 and 2024.
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the following fiscal years:
(Thousands)202620272028202920302031 - 2035
Pension$17,309 $18,452 $19,506 $20,678 $21,625 $120,947 
OPEB$12,262 $13,511 $14,599 $15,620 $16,479 $89,419 

The Company’s OPEB plans provide prescription drug benefits that are actuarially equivalent to those provided by Medicare Part D. Therefore, under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, the Company qualifies for federal subsidies. Estimated subsidy payments for fiscal 2026 and thereafter are immaterial.

Pension and OPEB assets held in the master trust, measured at fair value, are summarized as follows:
PensionOPEB
(Thousands)Quoted Prices in Active Markets for Identical Assets
(Level 1)		TotalQuoted Prices in Active Markets for Identical Assets
(Level 1)		Total
As of September 30, 2025
Assets
Registered Investment Companies:
Equity Funds:
Large Cap Index81,213 81,213 36,682 36,682 
Extended Market Index17,654 17,654 7,776 7,776 
International Stock52,876 52,876 22,243 22,243 
Fixed Income Funds:
Emerging Markets13,781 13,781 5,164 5,164 
Core Fixed Income— — 27,257 27,257 
High Yield Bond Fund16,864 16,864 8,798 8,798 
Long Duration Fund107,011 107,011 — — 
Total assets in the fair value hierarchy$289,399 289,399 $107,920 107,920 
Investments measured at net asset value
Collective investment trusts65,187 18,673 
Total assets at fair value$354,586 $126,593 
As of September 30, 2024
Assets
Money market funds$— $— $24 $24 
Registered Investment Companies:
Equity Funds:
Large Cap Index76,897 76,897 38,040 38,040 
Extended Market Index16,665 16,665 7,977 7,977 
International Stock50,549 50,549 22,730 22,730 
Fixed Income Funds:
Emerging Markets13,354 13,354 5,358 5,358 
Core Fixed Income— — 28,765 28,765 
High Yield Bond Fund16,704 16,704 9,195 9,195 
Long Duration Fund106,656 106,656 — — 
Total assets in the fair value hierarchy$280,825 280,825 $112,089 112,089 
Investments measured at net asset value
Collective investment trusts61,885 17,632 
Total assets at fair value$342,710 $129,721 
The Plan had no Level 2 or Level 3 fair value measurements during fiscal 2025 and 2024, and there have been no changes in valuation methodologies as of September 30, 2025. The Plan held assets that are valued using NAV as a practical expedient, which are excluded from the fair value hierarchy.

The following is a description of the valuation methodologies used for assets measured at fair value:

Asset TypesDescription of the Valuation Methodologies
Money Market fundsRepresents bank balances and money market funds that are valued based on the NAV of shares held at year end.
Registered Investment CompaniesEquity and fixed income funds valued at the NAV of shares held by the plan at year end as reported on the active market on which the individual securities are traded.
Collective investment trustsThe NAV for collective investment trusts is provided by the Trustee and is used as a practical expedient to estimate fair value. The NAV is based on the value of the underlying assets owned by the fund less liabilities.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

Defined Contribution Plan

The Company offers a Savings Plan to eligible employees. The Company formally matched 85% of participants’ contributions up to 6% of base compensation. Beginning in March 2024, the Company’s contribution changed to 100% of the first 3% and 80% of the next 3% of base compensation. Represented NJRHS employees, non-represented employees hired on or after October 1, 2009, and NJNG represented employees hired on or after January 1, 2012, are eligible for an employer special contribution of between 4.0% and 5.0% of base compensation, depending on years of service, into the Savings Plan on their behalf. The amount expensed and contributed for the matching provision of the Savings Plan was approximately $7.2M in fiscal 2025, $6.8M in fiscal 2024 and $5.9M in fiscal 2023. The amount contributed for the employer special contribution of the Savings Plan was approximately $4.2M in fiscal 2025, $3.6M in fiscal 2024 and $2.1M in fiscal 2023.