6 .	ACCRUED RETIREMENT BENEFITS

Accrued Retirement Benefits at

December

31,

2016

and

2015

consisted of the following:

	2016			2015
	(in thousands)

Defined benefit pension plans	$	7,560		$	6,264
Non-qualified retirement plans		1,674			4,366
Total		9,234			10,630
Less current portion		(175	)		(378	)
Non-current portion of accrued retirement benefits	$	9,059		$	10,252

The Company has

two

defined benefit pension plans which cover substantially all of its former bargaining and non-bargaining full-time, part-time and intermittent employees. In

2011,

pension benefits under both plans were frozen. The Company also has unfunded non-qualified retirement plans covering

twelve

of its former executives. The non-qualified retirement plans were frozen in

2009

and future vesting of additional benefits was discontinued.

During the

fourth

quarter of

2016,

participants who had terminated employment and had not started to collect their pension benefits were offered a limited-time opportunity to take their benefits as a

one

-time lump sum payment. The offer was extended to approximately

500

participants of which

325

participants elected to take the

one

-time lump sum payment. In total, approximately

$9.3

million lump sum payments were paid out of the trust for the defined benefit pension plan settlements.

The measurement date for the Company’s benefit plan disclosures is

December

of each year. The changes in benefit obligations and plan assets for

2016

and

2015,

and the funded status of the plans, and assumptions used to determine benefit information at

December

31,

2016

and

2015

were as follows:

	2016			2015
	(in thousands)

Change in benefit obligations:
Benefit obligations at beginning of year	$	66,852		$	71,349
Interest cost		2,804			2,753
Actuarial loss (gain)		1,042			(2,783	)
Benefits paid		(4,217	)		(4,467	)
Lump sum payments		(10,103	)		-
Benefit obligations at end of year		56,378			66,852

Change in plan assets:
Fair value of plan assets at beginning of year		56,434			64,341
Actual return on plan assets		5,188			(3,463	)
Employer reimbursement for retirement benefits		(1,054	)		(271	)
Employer contributions		928			294
Benefits paid		(4,217	)		(4,467	)
Lump sum payments		(10,103	)		-

Fair value of plan assets at end of year		47,176			56,434

Funded status	$	(9,202	)	$	(10,418	)

Accumulated benefit obligations	$	56,378		$	66,852

Weighted average assumptions used to determine benefit obligations at December 31:
Discount rate	4.07%	-	4.14%	4.30%	-	4.44%
Expected long-term return on plan assets		5.00%			7.00%
Rate of compensation increase		n/a			n/a

Accumulated other comprehensive loss of

$22.3

million and

$28.7

million at

December

31,

2016

and

2015,

respectively, represent the net actuarial loss which has not yet been recognized as a component of pension expense. In

2017,

$0.8

million of net actuarial loss is expected to be recognized as a component of net pension expense.

Components of net periodic benefit cost and other amounts recognized in comprehensive income were as follows:

	2016			2015
	(in thousands)

Pension and other benefits:
Interest cost	$	2,804		$	2,753
Expected return on plan assets		(2,713	)		(3,306	)
Recognized net actuarial loss		1,030			843
Settlement/Curtailment Expense		3,958			-
Pension expense	$	5,079		$	290

Other changes in plan assets and benefit obligations recognized in comprehensive income:
Net (gain) loss	$	(1,384	)	$	3,986
Recognized loss		(4,988	)		(893	)
Total recognized (gain) loss in comprehensive income	$	(6,372	)	$	3,093

Weighted average assumptions used to determine net periodic benefit cost:	2016			2015
Pension benefits:
Discount rate	4.30%	-	4.44%	3.96%	-	4.07%
Expected long-term return on plan assets		5.00%			5.32%
Rate of compensation increase		n/a			n/a

The expected long-term rate of return on plan assets was based on a building-block approach. Historical markets are studied and long-term historical relationships between equities and fixed income are presumed consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. Current market factors, such as inflation and interest rates, are evaluated before long-term capital markets are determined. Diversification and rebalancing of plan assets are properly considered as part of establishing long-term portfolio returns.

The fair values of the Company’s pension plan assets at

December

31,

2016

and

2015,

by asset category, were as follows:

	2016 Fair Value Measurements (in thousands)
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
AHGT pooled equity funds	$	-	$	7,177	$	7,177
AHGT pooled fixed income funds		-		39,025		39,025
Cash management funds		-		974		974
	$	-	$	47,176	$	47,176

	2015 Fair Value Measurements (in thousands)
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
AHGT pooled equity funds	$	-	$	8,120	$	8,120
AHGT pooled fixed income funds		-		46,069		46,069
Cash management funds		-		2,245		2,245
	$	-	$	56,434	$	56,434

Aon Hewitt Group Trust (AHGT)

ooled equity and fixed income funds:

Pooled equity and fixed income funds consist of various AHGT Funds offered through private placements. The units are valued daily using net asset values (NAV). NAV are based on the fair value of each fund’s underlying investments. Level

assets are priced using quotes for trades occurring in active markets for the identical asset. Level

assets are priced using observable inputs for the asset (for example, interest rates and yield curves observable at commonly quoted intervals, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or inputs that are derived principally from or corroborated by observable market data by correlation or other means (market-corroborated inputs).

An administrative committee consisting of certain senior management employees administers the Company’s defined benefit pension plans. The pension plan assets are allocated among approved asset types based on the plans current funded status and other characteristics set by the administrative committee, and subject to liquidity requirements of the plans.

Estimated future benefit payments are as follows (in thousands):

2017			$	4,283
2018				4,180
2019				4,123
2020				4,084
2021				3,995
2022	-	2026		18,332

2012,

the Company’s cessation of its golf operations and corresponding reduction in active participant counts triggered the requirement that the Company provide security to the Pension Benefits Guaranty Corporation (PBGC) of approximately

$18.7

million to support the unfunded liabilities of its pension plans at the time or make contributions to the plans in excess of the minimum required amounts. In

2012,

the Company pledged a total of

6,800

acres of former agricultural lands in West Maui to the PBGC for

five

years in satisfaction of the requirement. No formal appraisal or determination of the fair value of the pledged properties was performed by the Company or the PBGC.

The Company does

not

expect to be required to make minimum contributions to its pension plans in

2017.

required minimum contributions were made in

2016

2015.