Employee Benefits

6 Months Ended

Jun. 30, 2011

Employee Benefits [Abstract]

Employee Benefits

14. Employee Benefits

Pension Plans

Effective December 31, 2009, we amended our pension plans to freeze all benefit accruals and close the plans to new employees. We will continue to credit participants’ existing account balances for interest until they receive their plan benefits. We changed certain pension plan assumptions as a result of freezing the pension plans.

The components of net pension cost for all funded and unfunded plans are as follows:

	Three months ended June 30,						Six months ended June 30,
in millions	2011			2010			2011			2010
Interest cost on PBO	$	14		$	15		$	28		$	30
Expected return on plan assets		(20	)		(18	)		(40	)		(36	)
Amortization of losses		3			9			6			18
Net pension cost	$	(3	)	$	6		$	(6	)	$	12

We made a discretionary contribution of $100 million to our primary qualified cash balance pension plan in the first quarter of 2011.

Other Postretirement Benefit Plans

We sponsor a contributory postretirement healthcare plan that covers substantially all active and retired employees hired before 2001 who meet certain eligibility criteria. Retirees’ contributions are adjusted annually to reflect certain cost-sharing provisions and benefit limitations. We also sponsor a death benefit plan covering certain grandfathered employees; the plan is noncontributory. We use separate VEBA trusts to fund the healthcare plan and the death benefit plan.

The components of net postretirement benefit cost for all funded and unfunded plans are as follows:

	Three months ended June 30,						Six months ended June 30,
in millions	2011			2010			2011			2010
Interest cost on APBO	$	1		$	1		$	2		$	2
Expected return on plan assets		(1	)		(1	)		(2	)		(2	)
Amortization of unrecognized prior service benefit		—			(1	)		—			(1	)
Net postretirement benefit cost		—		$	(1	)		—		$	(1	)

The “Patient Protection and Affordable Care Act” and “Education Reconciliation Act of 2010,” which were signed into law on March 23, 2010 and March 30, 2010, respectively, changed the tax treatment of federal subsidies paid to sponsors of retiree health benefit plans that provide a benefit that is at least “actuarially equivalent” to the benefits under Medicare Part D. As a result of these laws, these subsidy payments become taxable in tax years beginning after December 31, 2012. The accounting guidance applicable to income taxes requires the impact of a change in tax law to be immediately recognized in the period that includes the enactment date. The changes to the tax law as a result of the “Patient Protection and Affordable Care Act” and “Education Reconciliation Act of 2010” did not impact us as we did not have a deferred tax asset recorded as a result of Medicare Part D subsidies received.