NOTE 16 — EMPLOYEE BENEFIT PLANS

Multi-employer benefit plans. Employees of the Company who are members of various unions are covered by union-sponsored, collectively bargained, multiemployer health and welfare and defined benefit pension plans. Of these plans, the Company considers the Southern Nevada Culinary and Bartenders Pension Plan (the “Pension Plan”), under the terms of collective bargaining agreements with the Local Joint Executive Board of Las Vegas for and on behalf of Culinary Workers Union Local No. 226 and Bartenders Union Local No. 165, to be individually significant. The risk of participating in the Pension Plan differs from single-employer plans in the following aspects:

Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers;

If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers;

If an entity chooses to stop participating in some of its multiemployer plans, the entity may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability; and

If the Pension Plan is terminated by withdrawal of all employers and if the value of the nonforfeitable benefits exceeds plan assets and withdrawal liability payments, employers are required by law to make up the insufficient difference.

Pursuant to its collective bargaining agreements referenced above, the Company also contributes to UNITE HERE Health (the “Health Fund”), which provides healthcare benefits to its active and retired members. The Company’s participation in the Pension Plan is outlined in the table below.

				Expiration Date
		Pension Protection Act		of Collective
	EIN/Pension	Zone Status ⁽¹⁾		Bargaining
Pension Fund	Plan Number	2015	2014	Agreements ⁽²⁾
Southern Nevada Culinary and Bartenders Pension Plan	88-6016617/001	Green	Green	5/31/2018

(1)

In 2014, the trustees of the Pension Plan elected to apply the extended amortization and the special ten-year asset smoothing rules under the Pension Relief Act of 2010.

(2)

The Company is party to ten collective bargaining agreements that require contributions to the Pension Plan. The agreements between CityCenter Hotel Casino, LLC, Bellagio, Mandalay Corp., MGM Grand Hotel, LLC and the Local Joint Executive Board of Las Vegas are the most significant because more than half of the Company’s employee participants in the Pension Plan are covered by those four agreements.

Contributions to the Company’s multi-employer pension plans and other multi-employer benefit plans were as follows:

	Year Ended December 31,
	2016		2015		2014
Multi-employer Pension Plans	(In thousands)
Southern Nevada Culinary and Bartenders Pension Plan	$	44,001	$	41,904	$	33,927
Other pension plans not individually significant		8,592		9,680		7,323
Total multi-employer pension plans	$	52,593	$	51,584	$	41,250

Multi-employer Benefit Plans Other Than Pensions
UNITE HERE Health	$	187,356	$	191,733	$	202,641
Other		11,513		12,840		12,746
Total multi-employer benefit plans other than pensions	$	198,869	$	204,573	$	215,387

Pension Plan contributions in 2016 increased when compared to 2015 due to the contribution rate to the Pension Plan increasing in mid-2016 as defined under the collective bargaining agreements, which was partially offset by a 3% decrease in hours worked in 2016 compared to 2015. During 2014 an amendment to the collective bargaining agreements to temporarily divert contributions from the Pension Plan to the Health Fund was in effect. As a result, contributions to the Pension Plan increased in 2015 compared to 2014 as the amendment ended in June of 2014. Bellagio, Aria, Mandalay Bay and MGM Grand Las Vegas were listed in the Pension Plan’s Forms 5500 as providing more than 5% of the total contributions for the plan years ended December 31, 2015 and 2014. At the date the financial statements were issued, Form 5500 was not available for the plan year ending in 2016. No surcharges were imposed on the Company’s contributions to any of the plans.

Borgata. The above disclosures exclude multi-employer defined benefit pension plans under terms of collective-bargaining agreements that cover union-represented employees at Borgata (acquired on August 1, 2016). These unions cover certain of its culinary, hotel and other trade workers. Borgata is obligated to make defined contributions under these plans and is also subject to the risks outlined above for the Company’s other multi-employer pension plans. Contributions, based on wages paid to covered employees, totaled $4 million, for the period from acquisition through December 31, 2016. Borgata’s most significant plan is the Legacy Plan of the National Retirement Fund, Former HEREIU and Local 54 (the “The Local 54 Pension Plan”), which has been listed in “critical status” (which means it is generally less than 65% funded) and a rehabilitation plan has been adopted. As a result, the Company is responsible for the payment of surcharges in addition to the contribution rate specified in the collective bargaining agreement. The Company estimates Borgata’s share of unfunded vested liabilities related to certain multi-employer pension plans is approximately $288 million as of January 1, 2016, which amount primarily relates to The Local 54 Pension Plan, and which amount is subject to change each year depending on the applicable plan’s employer contributions, investment performance and other factors. Borgata has no current intention to withdraw from these plans, which withdrawal could result in the incurrence of a contingent liability that would be payable in an amount and at such time (or over a period of time) that would vary based on a number of factors at the time of (and after) withdrawal.

Self-insurance. The Company is self-insured for most health care benefits and workers compensation for its non-union employees. The liability for health care claims filed and estimates of claims incurred but not reported was $30 million and $22 million at December 31, 2016 and 2015, respectively. The workers compensation liability for claims filed and estimates of claims incurred but not reported was $53 million and $43 million as of December 31, 2016 and 2015, respectively. Both liabilities are included in “Other accrued liabilities.”

Retirement savings plans. The Company has retirement savings plans under Section 401(k) of the IRC for eligible employees. The plans allow employees to defer, within prescribed limits, up to 75% of their income on a pre-tax and/or after-tax basis through contributions to the plans. The Company matches 50% of the first 6% of eligible employee deferrals up to a specified annual maximum dollar amount. The Company recorded charges for 401(k) contributions of $20 million, $16 million and $17 million in 2016, 2015 and 2014, respectively.

The Company maintains nonqualified deferred retirement plans for certain key employees. The plans allow participants to defer, on a pre-tax basis, a portion of their salary and bonus and accumulate tax deferred earnings, plus investment earnings on the deferred balances, as a deferred tax savings. All employee deferrals vest immediately. The Company does not contribute to the plan.

The Company also maintains nonqualified supplemental executive retirement plans (“SERP”) for certain key employees. Until September 2008, the Company made quarterly contributions intended to provide a retirement benefit that is a fixed percentage of a participant’s estimated final five-year average annual salary, up to a maximum of 65%. The Company has indefinitely suspended these contributions. Employees do not make contributions under these plans. A portion of the Company contributions and investment earnings thereon vest after three years of SERP participation and the remaining portion vests after both five years of SERP participation and 10 years of continuous service.

MGM China. MGM China contributes to a retirement plan as part of an employee benefits package for eligible employees. The Company recorded charges related to contributions in the retirement plan of $7 million, $7 million and $5 million for the years ended December 31, 2016, 2015, and 2014, respectively.