Pension And Postretirement Benefits

3 Months Ended

Mar. 31, 2019

Pension and Other Postretirement Benefits Disclosure [Text Block]

NOTE 6. PENSION AND POSTRETIREMENT BENEFITS

Many of our employees are covered by one of our noncontributory pension plans. We also provide certain medical, dental, life insurance and death benefits to certain retired employees under various plans and accrue actuarially determined postretirement benefit costs. Our objective in funding these plans, in combination with the standards of the Employee Retirement Income Security Act of 1974, as amended (ERISA), is to accumulate assets sufficient to provide benefits described in the plans to employees upon their retirement.

During the quarter, for certain management participants in our pension plan who terminated employment before April 1, 2019, we offered the option of more favorable 2018 interest rates and mortality basis for determining lump-sum distributions. For the quarter ended March 31, 2019 we recorded special termination benefits of $93 associated with this offer in “Other income (expense) – net.” During the first quarter, we also committed to a plan to offer certain terminated vested pension plan participants the opportunity to receive their benefit in a lump-sum amount.

We recognize actuarial gains and losses on pension and postretirement plan assets in our consolidated results as a component of other income (expense) – net at our annual measurement date of December 31, unless earlier remeasurements are required. We anticipate total distributions from the pension plan will exceed the threshold of service and interest costs for 2019, requiring us to follow settlement accounting. We have remeasured our pension benefit obligations at March 31, 2019, and will remeasure our pension benefit obligation at each quarter-end of 2019 as we expect settlements to occur during each quarter.

As part of our first-quarter 2019 remeasurement, we decreased the weighted-average discount rate used to measure our pension benefit obligation from 4.50% to 4.10%. The discount rate in effect for determining pension service and interest costs after remeasurement is 4.30% and 3.70%, respectively. The remeasurement reflects an actual return on plan assets of 5.80% (quarterly rate) relative to our expected long-term rate of 7.00% (annual rate).

The following table details pension and postretirement benefit costs included in the accompanying consolidated statements of income. The service cost component of net periodic pension cost (benefit) is recorded in operating expenses in the consolidated statements of income while the remaining components are recorded in “Other income (expense) – net.”

	Three months ended
	March 31,
	2019		2018
Pension cost:
Service cost – benefits earned during the period	$	240	$	291
Interest cost on projected benefit obligation		549		487
Expected return on assets		(851)		(760)
Amortization of prior service credit		(33)		(30)
Actuarial (gain) loss		432		-
Net pension (credit) cost	$	337	$	(12)

Postretirement cost:
Service cost – benefits earned during the period	$	18	$	29
Interest cost on accumulated postretirement benefit obligation		186		191
Expected return on assets		(56)		(77)
Amortization of prior service credit		(426)		(397)
Actuarial (gain) loss		-		(930)
Net postretirement (credit) cost	$	(278)	$	(1,184)

Combined net pension and postretirement (credit) cost	$	59	$	(1,196)

We also provide senior- and middle-management employees with nonqualified, unfunded supplemental retirement and savings plans. For the first quarter ended 2019 and 2018, net supplemental pension benefits costs not included in the table above were $25 and $21.