Defined Benefit Postretirement Plans

9 Months Ended

Sep. 30, 2012

Defined Benefit Postretirement Plans [Abstract]

Defined Benefit Postretirement Plans

Note 9. Defined Benefit Postretirement Plans

The Company has a qualified, noncontributory, defined benefit pension plan covering substantially all of its employees at September 30, 2012. Benefits paid from the plan are based on age, years of service, compensation and social security benefits, and are determined in accordance with defined formulas. The Company's policy is to fund the pension plan in accordance with Employee Retirement Income Security Act ("ERISA") standards. Assets of the plan are invested in publicly traded stocks and bonds. Prior to January 1, 2000, the Company's plan was a traditional defined benefit plan based on final average compensation. On January 1, 2000, the plan was converted to a cash balance plan with grandfathering provisions for existing participants.

In addition to the pension plan, the Company also provides supplemental employee retirement plans to certain current and former executives. These supplemental employee retirement plans and the defined benefit pension plan are collectively referred to herein as "Pension Benefits."

Also, the Company provides certain health care benefits for retired employees. Benefits are accrued over the employees' active service period. Only employees that were employed by the Company on or before January 1, 2000 are eligible to receive postretirement health care benefits. The plan is contributory for participating retirees, requiring participants to absorb certain deductibles and coinsurance amounts with contributions adjusted annually to reflect cost sharing provisions and benefit limitations called for in the plan. Eligibility is contingent upon the direct transition from active employment status to retirement without any break in employment from the Company. Employees also must be participants in the Company's medical plan prior to their retirement. The Company funds the cost of postretirement health care as benefits are paid. The Company elected to recognize the transition obligation on a delayed basis over twenty years. These postretirement benefits are referred to herein as "Other Benefits."

The components of expense for Pension Benefits and Other Benefits are set forth below (in thousands):

	Pension Benefits						Other Benefits
	Three months ended September 30,						Three months ended September 30,
Components of net periodic benefit cost:	2012			2011			2012			2011
Service cost	$	757		$	668		$	6		$	5
Interest cost		774			874			40			57
Expected return on plan assets		(1,676	)		(1,914	)		-			-
Net amortization		992			408			(3	)		9
Total cost	$	847		$	36		$	43		$	71

	Pension Benefits						Other Benefits
	Nine months ended September 30,						Nine months ended September 30,
Components of net periodic benefit cost:	2012			2011			2012			2011
Service cost	$	2,270		$	2,003		$	16		$	15
Interest cost		2,322			2,621			119			171
Expected return on plan assets		(5,026	)		(5,742	)		-			-
Net amortization		2,710			1,221			(8	)		27
Total cost	$	2,276		$	103		$	127		$	213

The Company is not required to make contributions to the plans in 2012, and did not do so during the nine months ended September 30, 2012.

Market conditions can result in an unusually high degree of volatility and increase the risks and short term liquidity associated with certain investments held by the Company's defined benefit pension plan ("the Plan") which could impact the value of these investments.