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Pension and Postretirement Plans
 12 Months Ended
Dec. 31, 2017
Retirement Benefits [Abstract]  
Pension and Postretirement Plans [Text Block]
Pension and Postretirement Plans
Savings Plans
The Company sponsors several defined contribution plans covering substantially all employees. The Company's contributions to the plans are based on matching a portion of the employee contributions. Both employer and employee contributions are invested in various investment funds at the direction of the employee. Employer contributions to the defined contribution plans were $8.2 million, $8.4 million, and $7.0 million in 2017, 2016, and 2015, respectively.
Pension and Postretirement Plans
The Company sponsors three noncontributory defined benefit pension plans: one for eligible management employees, one for non-management employees, and one supplemental, nonqualified, unfunded plan for certain former senior executives. The management pension plan is a cash balance plan in which the pension benefit is determined by a combination of compensation-based credits and annual guaranteed interest credits. The non-management pension plan is also a cash balance plan in which the combination of service and job-classification-based credits and annual interest credits determine the pension benefit. During 2017, the non-management pension plan made lump sum payments of $11.0 million resulting in a reduction of the plan benefit obligation of $11.3 million. The Company recorded a pension settlement cost of $4.0 million as a result of the lump sum payments to the plan participants exceeding the sum of the service cost and the interest cost component of the net pension cost. During the second quarter of 2015, the non-management pension plan was amended to eliminate all future pension credits and transition benefits. As a result, we recognized a curtailment loss of $0.3 million and a $1.7 million reduction to the associated pension obligations. Benefits for the supplemental plan are based on eligible pay, adjusted for age and service upon retirement. We fund both the management and non-management plans in an irrevocable trust through contributions, which are determined using the traditional unit credit cost method. We also use the traditional unit credit cost method for determining pension cost for financial reporting purposes.
The Company also provides healthcare and group life insurance benefits for eligible retirees. We fund healthcare benefits and other group life insurance benefits using Voluntary Employee Benefit Association ("VEBA") trusts. It is our practice to fund amounts as deemed appropriate from time to time. Contributions are subject to Internal Revenue Service ("IRS") limitations developed using the traditional unit credit cost method. The actuarial expense calculation for our postretirement health plan is based on numerous assumptions, estimates, and judgments including healthcare cost trend rates and cost sharing with retirees. Retiree healthcare benefits are being phased out for both management and certain retirees. During 2017, the Company reviewed the employees with special death benefits only within the defined benefit pension plans and determined that the liabilities associated with the special death benefits would be better associated with the postretirement health plans. As a result, the Company eliminated the liability associated with the special death benefits in the defined benefit pension plans, and recorded a liability of $14.0 million in the postretirement health plans in 2017.
Components of Net Periodic Cost
The following information relates to noncontributory defined benefit pension plans, postretirement healthcare plans, and life insurance benefit plans. Approximately 13% in 2017, 13% in 2016, and 12% in 2015 of these costs were capitalized to property, plant and equipment related to network construction in the Entertainment and Communications segment. Pension and postretirement benefit costs for these plans were comprised of:
 
Pension Benefits
 
Postretirement and Other Benefits
(dollars in millions)
2017
 
2016
 
2015
 
2017
 
2016
 
2015
Service cost
$
—

 
$
—

 
$
0.3

 
$
0.2

 
$
0.3

 
$
0.3

Interest cost on projected benefit obligation
19.4

 
19.3

 
19.0

 
3.2

 
3.3

 
3.3

Expected return on plan assets
(26.0
)
 
(27.3
)
 
(29.2
)
 
—

 
—

 
—

Amortization of:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost (benefit)
—

 
0.1

 
0.1

 
(4.5
)
 
(14.7
)
 
(15.4
)
Actuarial loss
17.5

 
19.1

 
24.9

 
4.7

 
4.9

 
5.4

Pension settlement charges
4.0

 
—

 
—

 
—

 
—

 
—

Curtailment loss
—

 
—

 
0.3

 
—

 
—

 
—

Pension/postretirement cost (benefit)
$
14.9

 
$
11.2

 
$
15.4

 
$
3.6

 
$
(6.2
)
 
$
(6.4
)

The following are the weighted-average assumptions used in measuring the net periodic cost of the pension and postretirement benefits:
 
Pension Benefits
 
 
Postretirement and Other Benefits
 
 
2017
 
2016
 
2015
 
 
2017
 
2016
 
2015
 
Discount rate
4.10
%
 
3.80
%
 
3.40
%
*
 
4.00
%
 
3.70
%
 
3.40
%
 
Expected long-term rate of return
7.25
%
 
7.50
%
 
7.75
%
 
 
—

 
—

 
—

 
Future compensation growth rate
—

 
—

 
—

 
 
—

 
—

 
—

 

* Discount rate used for the remeasurement of the non-management pension plan in April 2015 was consistent with the discount rate previously established.
The expected long-term rate of return on plan assets, developed using the building block approach, is based on the mix of investments held directly by the plans and the current view of expected future returns, which is influenced by historical averages. Changes in actual asset return experience and discount rate assumptions can impact the Company’s operating results, financial position and cash flows.
Benefit Obligation and Funded Status
Changes in the plans' benefit obligations and funded status are as follows:
 
 
 
 
 
Postretirement and Other Benefits
 
Pension Benefits
 
(dollars in millions)
2017
 
2016
 
2017
 
2016
Change in benefit obligation:
 
 
 
 
 
 
 
   Benefit obligation at January 1,
$
505.6

 
$
530.5

 
$
82.6

 
$
93.1

Service cost
—

 
—

 
0.2

 
0.3

Interest cost
19.4

 
19.3

 
3.2

 
3.3

Actuarial loss (gain)
28.1

 
(2.7
)
 
7.6

 
(4.7
)
Benefits paid
(38.6
)
 
(41.5
)
 
(11.6
)
 
(13.1
)
Retiree drug subsidy received
—

 
—

 
0.2

 
0.6

Transfer of special death benefit
(14.0
)
 
—

 
14.0

 
—

Settlements
(11.3
)
 
—

 
—

 
—

Other
—

 
—

 
2.4

 
3.1

Benefit obligation at December 31,
$
489.2

 
$
505.6

 
$
98.6

 
$
82.6

 
 
 
 
 
 
 
 
Change in plan assets:
 
 
 
 
 
 
 
   Fair value of plan assets at January 1,
$
372.3

 
$
378.1

 
$
8.7

 
$
10.3

Actual return (loss) on plan assets
64.8

 
30.3

 
0.2

 
0.3

Employer contributions
4.6

 
5.4

 
10.0

 
10.6

Retiree drug subsidy received
—

 
—

 
0.2

 
0.6

Benefits paid
(38.6
)
 
(41.5
)
 
(11.6
)
 
(13.1
)
Settlements
(11.0
)
 
—

 
—

 
—

   Fair value of plan assets at December 31,
392.1

 
372.3

 
7.5

 
8.7

Unfunded status
$
(97.1
)
 
$
(133.3
)

$
(91.1
)

$
(73.9
)

The following are the weighted-average assumptions used in accounting for and measuring the projected benefit obligations:
 
Pension Benefits
 
Postretirement and Other Benefits
 
December 31,
 
December 31,
 
2017
 
2016
 
2017
 
2016
Discount rate
3.60
%
 
4.00
%
 
3.60
%
 
4.00
%
Future compensation growth rate
—

 
—

 
—

 
—


The assumed healthcare cost trend rate used to measure the postretirement health benefit obligation is shown below:
 
December 31,
 
2017
 
2016
Healthcare cost trend
6.5
%
 
6.5
%
Rate to which the cost trend is assumed to decline (ultimate trend rate)
4.5
%
 
4.5
%
Year the rates reach the ultimate trend rate
2022

 
2021


A one-percentage point change in assumed healthcare cost trend rates would have the following effect on the postretirement benefit costs and obligation:
(dollars in millions)
1% Increase
 
1% Decrease
Service and interest costs for 2017
$
0.2

 
$
(0.1
)
Postretirement benefit obligation at December 31, 2017
3.2

 
(2.9
)

The projected benefit obligation is recognized in the Consolidated Balance Sheets as follows:
 
Pension Benefits
 
Postretirement and Other Benefits
 
December 31,
 
December 31,
(dollars in millions)
2017
 
2016
 
2017
 
2016
Accrued payroll and benefits (current liability)
$
2.1

 
$
2.1

 
$
10.5

 
$
9.4

Pension and postretirement benefit obligations (noncurrent liability)
95.0

 
131.2

 
80.6

 
64.5

Total
$
97.1

 
$
133.3

 
$
91.1

 
$
73.9


Amounts recognized in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets which have not yet been recognized in net pension costs consisted of the following:
 
 
 
 
 
Postretirement and Other Benefits
 
Pension Benefits
 
 
December 31,
 
December 31,
(dollars in millions)
2017
 
2016
 
2017
 
2016
Prior service (cost) benefit, net of tax of ($0.1), ($0.1), $5.3, $10.6
$
(0.1
)
 
$
(0.1
)
 
$
19.9

 
$
19.1

Actuarial loss, net of tax of ($42.5), ($81.6), ($12.7), ($19.7)
(148.4
)
 
(141.8
)
 
(44.5
)
 
(34.8
)
Total
$
(148.5
)
 
$
(141.9
)
 
$
(24.6
)
 
$
(15.7
)

Amounts recognized in "Accumulated other comprehensive loss" on the Consolidated Statements of Shareowners’ Deficit and the Consolidated Statements of Comprehensive Income are shown below:
 
Pension Benefits
 
Postretirement and Other Benefits
(dollars in millions)
2017
 
2016
 
2017
 
2016
Prior service cost recognized:
 
 
 
 
 
 
 
     Reclassification adjustments
$
—

 
$
0.1

 
$
(4.5
)
 
$
(14.7
)
Actuarial (loss) gain recognized:
 
 
 
 
 
 
 
     Reclassification adjustments
21.5

 
19.1

 
4.7

 
4.9

     Actuarial gain (loss) arising during the period
11.0

 
5.7

 
(7.4
)
 
4.5


The following amounts currently included in "Accumulated other comprehensive loss" are expected to be recognized in 2018 as a component of net periodic pension and postretirement cost:
 
Pension Benefits
 
Postretirement and Other Benefits
(dollars in millions)
 
Prior service benefit
$
—

 
$
(3.1
)
Actuarial loss
17.6

 
4.6

Total
$
17.6

 
$
1.5


Plan Assets, Investment Policies and Strategies
The primary investment objective for the trusts holding the assets of the pension and postretirement plans is preservation of capital with a reasonable amount of long-term growth and income without undue exposure to risk. This is provided by a balanced strategy using fixed income and equity securities. The target allocations for the pension plan assets are 65% equity securities and 35% investment grade fixed income securities. Equity securities are primarily held in the form of passively managed funds that seek to track the performance of a benchmark index. Equity securities include investments in growth and value common stocks of companies located in the United States, which represents approximately 60% of the equity securities held by the pension plans at December 31, 2017, as well as stock of international companies located in both developed and emerging markets around the world. Fixed income securities primarily include holdings of funds, which generally invest in a variety of intermediate and long-term investment grade corporate bonds from diversified industries. The postretirement plan assets are currently invested in a group insurance contract.
The fair values of the pension plan assets at December 31, 2017 and 2016 by asset category are as follows:
(dollars in millions)
December 31, 2017
 
Quoted Prices
in active
markets
Level 1
 
Significant
observable
inputs
Level 2
 
Significant
unobservable
inputs
Level 3
Mutual funds
 
 
 
 
 
 
 
U.S. equity index funds
$
151.0

 
$
151.0

 
$
—

 
$
—

International equity index funds
101.3

 
101.3

 
—

 
—

Fixed income bond funds
136.1

 
136.1

 
—

 
—

Fixed income short-term money market funds
3.7

 
3.7

 
—

 
—

Group insurance contract
7.5

 
—

 
—

 
—

Total
$
399.6

 
$
392.1

 
$
—

 
$
—


(dollars in millions)
 
December 31, 2016
 
Quoted Prices
in active
markets
Level 1
 
Significant
observable
inputs
Level 2
 
Significant
unobservable
inputs
Level 3
Mutual funds
 
 
 
 
 
 
 
 
U.S. equity index funds
 
$
142.7

 
$
142.7

 
$
—

 
$
—

International equity index funds
 
95.6

 
95.6

 
—

 
—

Fixed income bond funds
 
123.9

 
123.9

 
—

 
—

Fixed income short-term money market funds
 
10.1

 
10.1

 
—

 
—

Group insurance contract
 
8.7

 
—

 
—

 
—

Total
 
$
381.0

 
$
372.3

 
$
—

 
$
—


The fair values of Level 1 investments are based on quoted prices in active markets.
The group insurance contract is valued at contract value plus accrued interest and has not been included in the fair value hierarchy, but is included in the totals above.
Contributions to our qualified pension plans were $2.3 million in 2017, $3.1 million in 2016, and $10.3 million in 2015. Contributions to our non-qualified pension plan were $2.3 million in 2017, $2.3 million in 2016, and $2.2 million in 2015.
Based on current assumptions, contributions to qualified and non-qualified pension plans in 2018 are expected to be approximately $4 million and $3 million, respectively. Management expects to make cash payments of approximately $9 million related to its postretirement health plans in 2018.
Estimated Future Benefit Payments
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid over the next ten years:
(dollars in millions)
Pension
Benefits
 
Postretirement
and Other
Benefits
 
Medicare
Subsidy
Receipts
2018
$
39.8

 
$
11.0

 
$
(0.5
)
2019
38.1

 
9.5

 
(0.4
)
2020
38.6

 
8.4

 
(0.4
)
2021
37.1

 
8.1

 
(0.4
)
2022
35.6

 
7.7

 
(0.3
)
Years 2023 - 2027
155.9

 
32.0

 
(1.2
)