PENSION AND OTHER POSTRETIREMENT BENEFITS

6 Months Ended

Jun. 30, 2011

PENSION AND OTHER POSTRETIREMENT BENEFITS [Abstract]

PENSION AND OTHER POSTRETIREMENT BENEFITS

9. PENSION AND OTHER POSTRETIREMENT BENEFITS:

For the three and six months ended June 30, 2011 and 2010, net periodic benefit cost related to the employee and officer pension and other postretirement benefit plans consisted of the following components (in thousands):

	Pension Benefits
	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Service Cost	$	946		$	854		$	1,959		$	1,713
Interest Cost		2,404			2,338			4,762			4,599
Expected Return on Plan Assets		(2,340	)		(2,258	)		(4,684	)		(4,201	)
Amortizations:
Prior Service Cost		66			78			133			140
Actuarial Loss		1,417			999			2,720			2,375
Net Periodic Benefit Cost		2,493			2,011			4,890			4,626
ERIP Costs		-			-			102			-
Capitalized Benefit Costs		(902	)		(766	)		(1,812	)		(1,754	)
Total Net Periodic Benefit Expense	$	1,591		$	1,245		$	3,180		$	2,872

	Other Postretirement Benefits
	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Service Cost	$	228		$	221		$	498		$	460
Interest Cost		820			813			1,600			1,634
Expected Return on Plan Assets		(562	)		(564	)		(1,124	)		(969	)
Amortizations:
Prior Service Credits		(88	)		(89	)		(177	)		(177	)
Actuarial Loss		434			291			827			747
Net Periodic Benefit Cost		832			672			1,624			1,695
Capitalized Benefit Costs		(297	)		(240	)		(605	)		(659	)
Total Net Periodic Benefit Expense	$	535		$	432		$	1,019		$	1,036

Capitalized benefit costs reflected in the table above relate to SJG's construction program.

The ERIP costs reflected in the table above relate to an early retirement plan offered during 2011 to one of our business segments.

No contributions were made to the pension plans during the six-month period ended June 30, 2011.  During May 2010, SJI contributed $8.0 million to its pension plans.  We do not expect to make any contributions to our pension plans in 2011; however, changes in future investment performance and discount rates may ultimately result in a contribution. We also have a regulatory obligation to contribute approximately $3.6 million annually to our other postretirement benefit plans' trusts, less costs incurred directly by us.

See Note 12 to the Consolidated Financial Statements in Item 8 of SJI's Annual Report on Form 10-K as of December 31, 2010, for additional information related to SJI's pension and other postretirement benefits.