Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Components of Income Tax Expense (Benefit)

Income tax expense (benefit) from continuing operations for the years ended December 31 was as follows (in thousands):



	2015		2014			2013
Current	$	14,910	$	(6	)	$	(163	)
Deferred	7,690		16,518			13,582
Total income tax expense	$	22,600	$	16,512		$	13,419

Schedule of Deferred Tax Assets and Liabilities

The temporary differences which gave rise to the net deferred tax liability, for the years ended December 31 were as follows (in thousands):



	2015			2014
Deferred tax assets:
Employee benefits	$	4,683		$	4,995
Net operating loss	15			14,794
Regulatory liabilities	9,908			10,824
Other	16,171			2,864
Total deferred tax assets	30,777			33,477

Deferred tax liabilities:
Accelerated depreciation and other plant related differences	(187,666		)	(184,478		)
AFUDC	(8,571		)	(8,365		)
Regulatory assets	(4,236		)	(3,910		)
Employee benefits	(3,003		)	(3,723		)
Deferred costs	(14,765		)	(11,324		)
Other	(1,497		)	(1,058		)
Total deferred tax liabilities	(219,738		)	(212,858		)

Net deferred tax assets (liabilities)	$	(188,961	)	$	(179,381	)

Schedule of Effective Income Tax Rate Reconciliation

The effective tax rate differs from the federal statutory rate for the years ended December 31, as follows:



	2015		2014		2013
Federal statutory rate	35.0	%	35.0	%	35.0	%
Amortization of excess deferred and investment tax credits	(0.1	)	(0.3	)	(0.3	)
Equity AFUDC	(0.6	)	(0.1	)	—
Flow through adjustments ^(a)	(0.9	)	(1.9	)	(2.5	)
Tax credits	—		(0.2	)	(0.8	)
Other	—		0.5		(0.6	)
	33.4	%	33.0	%	30.8	%

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(a)

The flow-through adjustments relate primarily to an accounting method change for tax purposes that allows us to take a current tax deduction for repair costs that continue to be capitalized for book purposes. We recorded a deferred income tax liability in recognition of the temporary difference created between book and tax treatment and we flowed the tax benefit through to our customers in the form of lower rates as a result of a rate case settlement that occurred during 2010. A regulatory asset was established to reflect the recovery of future increases in taxes payable from customers as the temporary differences reverse. As a result of this regulatory treatment, we continue to record a tax benefit consistent with the flow through method.

Summary of Deferred Tax Liability Not Recognized

The following table reconciles the total amounts of unrecognized tax benefits, without interest, included in Other deferred credits and other liabilities on the accompanying Balance Sheet (in thousands):



	2015			2014
Unrecognized tax benefits at January 1	$	1,623		$	2,443
Additions for prior year tax positions	888			434
Reductions for prior year tax positions	(247		)	(1,254		)
Additions for current year tax positions	—			—
Unrecognized tax benefits at December 31	$	2,264		$	1,623