Employee Benefit Plans (Notes)

12 Months Ended

Dec. 31, 2012

Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract]

Employee Benefit Plans [Text Block]

20. EMPLOYEE BENEFIT PLANS

The Company has four qualified non-contributory defined benefit pension plans covering a significant majority of its employees and an unfunded plan that provides benefits in excess of amounts allowable under current tax law in the qualified plans. The Company closed enrollment in its pension plans to salaried employees hired after December 31, 2005, to Fernandina hourly employees hired after April 30, 2006, to Jesup hourly employees hired after March 4, 2009 and to Wood Products hourly employees hired after February 28, 2011. Currently, all plans are closed to new participants. Employee benefit plan liabilities are calculated using actuarial estimates and management assumptions. These estimates are based on historical information, along with certain assumptions about future events. Changes in assumptions, as well as changes in actual experience, could cause the estimates to change.

In September 2008, the Company changed its postretirement medical plan for active and retired salaried employees to shift retiree medical costs to the plan participants over a three year phase-out period. Accordingly, the Company no longer incurs retiree medical costs for retired salary plan participants. The change was accounted for as a negative plan amendment and curtailment which resulted in a reduction to the retiree medical liability. The net impact of the reduction was an unrecognized gain in accumulated other comprehensive income of $7.7 million which was amortized over 1.9 years, the average remaining service period of the remaining active participants. As a result of the plan change, a gain of $2.4 million was included in the Company’s net periodic benefit cost in 2010.

The following tables set forth the change in the projected benefit obligation and plan assets and reconcile the funded status and the amounts recognized in the Consolidated Balance Sheets for the pension and postretirement benefit plans for the two years ended December 31:

	Pension						Postretirement
	2012			2011			2012			2011
Change in Projected Benefit Obligation
Projected benefit obligation at beginning of year	$	413,147		$	346,464		$	24,833		$	21,158
Service cost	8,407			6,782			918			673
Interest cost	17,284			18,087			956			972
Actuarial loss	32,666			58,208			2,021			3,934
Plan amendments	—			—			—			(631		)
Employee contributions	—			—			1,136			1,609
Benefits paid	(17,034		)	(16,394		)	(2,282		)	(2,882		)
Projected benefit obligation at end of year	$	454,470		$	413,147		$	27,582		$	24,833

Change in Plan Assets
Fair value of plan assets at beginning of year	$	295,655		$	302,464		$	—		$	—
Actual return on plan assets	41,729			8,977			—			—
Employer contributions	1,565			1,552			1,146			1,273
Employee contributions	—			—			1,136			1,609
Benefits paid	(17,034		)	(16,394		)	(2,282		)	(2,882		)
Other expense	(1,216		)	(944		)	—			—
Fair value of plan assets at end of year	$	320,699		$	295,655		$	—		$	—

Funded Status at End of Year:
Net accrued benefit cost	$	(133,771	)	$	(117,492	)	$	(27,582	)	$	(24,833	)

Amounts Recognized in the Consolidated
Balance Sheets Consist of:
Current liabilities	$	(1,702	)	$	(1,626	)	$	(1,256	)	$	(1,262	)
Noncurrent liabilities	(132,069		)	(115,866		)	(26,326		)	(23,571		)
Net amount recognized	$	(133,771	)	$	(117,492	)	$	(27,582	)	$	(24,833	)

Net gains or losses and prior service costs or credits recognized in other comprehensive income for the three years ended December 31 are as follows:

	Pension									Postretirement
	2012			2011			2010			2012			2011			2010
Net (losses) gains	$	(17,630	)	$	(75,995	)	$	1,348		$	(2,021	)	$	(3,934	)	$	(965	)
Prior service cost	—			—			(1,704		)	—			631			—

Net gains or losses and prior service costs or credits reclassified from other comprehensive income and recognized as a component of pension and postretirement expense for the three years ended December 31 are as follows:

	Pension						Postretirement
	2012		2011		2010		2012		2011		2010
Amortization of losses	$	17,578	$	10,372	$	6,456	$	582	$	570	$	3,357
Amortization of prior service cost (benefit)	1,308		1,359		1,657		25		69		(5,334		)

Net losses and prior service costs or credits that have not yet been included in pension and postretirement expense for the two years ended December 31, which have been recognized as a component of AOCI are as follows:

	Pension						Postretirement
	2012			2011			2012			2011
Prior service (cost) credit	$	(7,062	)	$	(8,370	)	$	193		$	167
Net losses	(191,813		)	(191,761		)	(11,939		)	(10,500		)
Deferred income tax benefit	61,968			62,797			4,073			3,583
AOCI	$	(136,907	)	$	(137,334	)	$	(7,673	)	$	(6,750	)

For pension and postretirement plans with accumulated benefit obligations in excess of plan assets, the following table sets forth the projected and accumulated benefit obligations and the fair value of plan assets for the two years ended December 31:

	2012		2011
Projected benefit obligation	$	482,052	$	437,980
Accumulated benefit obligation	434,810		392,182
Fair value of plan assets	320,699		295,655

The following tables set forth the components of net pension and postretirement benefit cost that have been recognized during the three years ended December 31:

	Pension									Postretirement
	2012			2011			2010			2012		2011		2010
Components of Net Periodic Benefit Cost
Service cost	$	8,407		$	6,782		$	6,196		$	918	$	673	$	587
Interest cost	17,284			18,087			17,740			956		972		1,029
Expected return on plan assets	(25,477		)	(25,819		)	(21,651		)	—		—		—
Amortization of prior service cost (benefit)	1,308			1,359			1,657			25		69		(5,334		)
Amortization of losses	17,578			10,372			6,456			582		570		3,357
Net periodic benefit cost (benefit)	$	19,100		$	10,781		$	10,398		$	2,481	$	2,284	$	(361	)

The estimated pre-tax amounts that will be amortized from AOCI into net periodic benefit cost in 2013 are as follows:

	Pension		Postretirement
Amortization of loss	$	19,215	$	711
Amortization of prior service cost	1,308		25
Total amortization of AOCI loss	$	20,523	$	736

The following table sets forth the principal assumptions inherent in the determination of benefit obligations and net periodic benefit cost of the pension and postretirement benefit plans as of December 31:

	Pension						Postretirement
	2012		2011		2010		2012		2011		2010
Assumptions used to determine benefit obligations at December 31:
Discount rate	3.70	%	4.20	%	5.25	%	3.60	%	4.10	%	5.10	%
Rate of compensation increase	4.60	%	4.50	%	4.50	%	4.50	%	4.50	%	4.50	%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.20	%	5.25	%	5.80	%	4.10	%	5.10	%	5.50	%
Expected long-term return on plan assets	8.50	%	8.50	%	8.50	%	—		—		—
Rate of compensation increase	4.50	%	4.50	%	4.50	%	4.50	%	4.50	%	4.50	%

At December 31, 2012, the pension plans’ discount rate was 3.70 percent, which closely approximates interest rates on high quality, long-term obligations. Effective December 31, 2012, the expected return on plan assets remained at 8.5 percent, which is based on historical and expected long-term rates of return on broad equity and bond indices and consideration of the actual annualized rate of return. The Company, with the assistance of external consultants, utilizes this information in developing assumptions for returns, and risks and correlation of asset classes, which are then used to establish the asset allocation ranges.

The following table sets forth the assumed health care cost trend rates at December 31:

	Postretirement
	2012		2011
Health care cost trend rate assumed for next year	7.50	%	8.00	%
Rate to which the cost trend rate is assumed to decline (ultimate trend rate)	5.00	%	5.00	%
Year that the rate reaches the ultimate trend rate	2017		2017

Assumed health care cost trend rates have a significant effect on the amounts reported for the postretirement benefit plans. The following table shows the effect of a one percentage point change in assumed health care cost trends:

	1 Percent
Effect on:	Increase		Decrease
Total of service and interest cost components	$	226	$	(187	)
Accumulated postretirement benefit obligation	2,089		(1,785		)

Investment of Plan Assets

The Company’s pension plans’ asset allocation at December 31, 2012 and 2011, and target allocation ranges by asset category are as follows:

	Percentage of Plan Assets				Target Allocation Range
Asset Category	2012		2011
Domestic equity securities	41	%	44	%	40-45%
International equity securities	25	%	20	%	20-30%
Domestic fixed income securities	26	%	28	%	25-30%
International fixed income securities	5	%	5	%	4-6%
Real estate fund	3	%	3	%	2-4%
Total	100	%	100	%

The Company's Pension and Savings Plan Committee and the Audit Committee of the Board of Directors oversee the pension plans’ investment program which is designed to maximize returns and provide sufficient liquidity to meet plan obligations while maintaining acceptable risk levels. The investment approach emphasizes diversification by allocating the plans’ assets among asset categories and selecting investment managers whose various investment methodologies will be minimally correlative with each other. Investments within the equity categories may include large capitalization, small capitalization and emerging market securities, while the international fixed income portfolio may include emerging markets debt. Pension assets did not include a direct investment in Rayonier common stock at December 31, 2012 or 2011.

Fair Value Measurements

The following table sets forth by level, within the fair value hierarchy (see Note 2 — Summary of Significant Accounting Policiesfor definition), the assets of the plans as of December 31, 2012 and 2011. Prior year level designations have been corrected to designate assets held in collective trust funds as level two. Management does not believe such correction is material to the previously issued financial statements.

	Fair Value at December 31, 2012						Fair Value at December 31, 2011
Asset Category	Level 1		Level 2		Total		Level 1		Level 2		Total
Domestic equity securities	$	50,653	$	76,251	$	126,904	$	128,834	$	—	$	128,834
International equity securities	51,758		27,173		78,931		57,728		—		57,728
Domestic fixed income securities	—		81,045		81,045		—		80,243		80,243
International fixed income securities	15,745		—		15,745		14,381		—		14,381
Real estate fund	10,208		—		10,208		9,846		—		9,846
Short-term investments	29		7,837		7,866		236		4,387		4,623
Total	$	128,393	$	192,306	$	320,699	$	211,025	$	84,630	$	295,655

The valuation methodology used for measuring the fair value of these asset categories was as follows:

Level 1 — Net asset value in an observable market.

Level 2 — Assets classified as level two are held in collective trust funds. The net asset value of a collective trust is calculated by determining the fair value of the fund's underlying assets, deducting its liabilities, and dividing by the units outstanding as of the valuation date. These funds are not publicly traded; however, the unit price calculation is based on observable market inputs of the funds' underlying assets.

There have been no changes in the methodology used during the years ended December 31, 2012 and 2011.

Cash Flows

Expected benefit payments for the next ten years are as follows:

	Pension Benefits		Postretirement Benefits
2013	$	18,903	$	1,256
2014	19,951		1,375
2015	20,979		1,436
2016	21,999		1,507
2017	23,011		1,526
2018 - 2022	128,704		7,701

The Company has no mandatory pension contribution requirements in 2013, but may make discretionary contributions.

Defined Contribution Plans

The Company provides defined contribution plans to all of its hourly and salaried employees. Company contributions charged to expense for these plans were $2.7 million, $2.6 million and $2.4 million for the years ended December 31, 2012, 2011 and 2010, respectively. Rayonier Hourly and Salaried Defined Contribution Plans include Rayonier common stock with a fair market value of $89.4 million and $85.4 million at December 31, 2012 and 2011, respectively.

As discussed above, all pension plans are currently closed to new employees. Employees not eligible for the pension plans are immediately eligible to participate in the Company’s 401(k) plan and receive an enhanced contribution. Company contributions related to this plan enhancement for the years ended December 31, 2012, 2011 and 2010 were $1.0 million, $0.9 million and $0.6 million, respectively.