Pension Plans And Other Postretirement Benefit Plans

3 Months Ended

Mar. 31, 2017

General Discussion of Pension and Other Postretirement Benefits [Abstract]

Pension Plans and Other Postretirement Benefit Plans

PENSION PLANS AND OTHER POSTRETIREMENT BENEFIT PLANS

Avista Utilities

Avista Utilities’ pension and other postretirement plans have not changed during the three months ended March 31, 2017. The Company’s funding policy is to contribute at least the minimum amounts that are required to be funded under the Employee Retirement Income Security Act, but not more than the maximum amounts that are currently deductible for income tax purposes. The Company contributed $7.4 million in cash to the pension plan for the three months ended March 31, 2017 and expects to contribute a total of $22.0 million in 2017. The Company contributed $12.0 million in cash to the pension plan in 2016.

The Company uses a December 31 measurement date for its defined benefit pension and other postretirement benefit plans. The following table sets forth the components of net periodic benefit costs for the three months ended March 31 (dollars in thousands):

	Pension Benefits						Other Post-retirement Benefits
	2017			2016			2017			2016
Three months ended March 31:
Service cost	$	5,042		$	4,519		$	824		$	779
Interest cost	6,951			6,900			1,399			1,559
Expected return on plan assets	(7,900		)	(6,750		)	(475		)	(475		)
Amortization of prior service cost	—			—			(312		)	(312		)
Net loss recognition	2,546			1,890			1,273			1,365
Net periodic benefit cost	$	6,639		$	6,559		$	2,709		$	2,916

Total net periodic benefit costs in the table above are recorded to the same accounts as labor expense. Labor and benefits expense is recorded to various projects based on whether the work is a capital project or an operating expense. Approximately 40 percent of all labor and benefits is capitalized to utility property and 60 percent is expensed to other operating expenses.