Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2014

Text Block [Abstract]

Fair Value of Financial Instruments

FAIR VALUEOF FINANCIAL INSTRUMENTS

GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are the following:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

Level 3: Prices or valuation techniques requiring inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity).

Financial Assets and Liabilities Measured at Fair Value

The following table summarizes our financial assets and liabilities that are measured at fair value on a recurring basis and the fair value measurements, by level, within the fair value hierarchy as of December 31, 2014:

			Fair Value Measurements Using:
(in thousands)	Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Investments—guaranteed income fund	$	287	$	—	$	—	$	287
Investments—other	$	3,391	$	3,391	$	—	$	—
Mark-to-market energy assets, incl. put/call options	$	1,055	$	—	$	1,055	$	—
Liabilities:
Mark-to-market energy liabilities, incl. swap agreements	$	1,018	$	—	$	1,018	$	—

The following table summarizes our financial assets and liabilities that are measured at fair value on a recurring basis and the fair value measurements, by level, within the fair value hierarchy as of December 31, 2013:

			Fair Value Measurements Using:
(in thousands)	Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Investments—guaranteed income fund	$	458	$	—	$	—	$	458
Investments—other	$	2,640	$	2,640	$	—	$	—
Mark-to-market energy assets, including put option	$	385	$	—	$	385	$	—
Liabilities:
Mark-to-market energy liabilities	$	127	$	—	$	127	$	—

The following table sets forth the summary of the changes in the fair value of Level 3 investments for the years ended December 31, 2014 and 2013:

	For the Year Ended December 31,
	2014			2013
(in thousands)
Beginning Balance	$	458		$	—
Transfers in due to change in trustee	—			425
Purchases and adjustments	76			41
Transfers	(253		)	(16		)
Investment income	6			8
Ending Balance	$	287		$	458

Investment income from the Level 3 investments is reflected in other income (loss) in the accompanying consolidated statements of income.

The following valuation techniques were used to measure fair value assets in the tables above on a recurring basis as of December 31, 2014 and 2013:

Level 1 Fair Value Measurements:

Investments- other — The fair values of these investments, comprised of money market and mutual funds, are recorded at fair value based on quoted net asset values of the shares.

Level 2 Fair Value Measurements:

Mark-to-market energy assets and liabilities — These forward contracts are valued using market transactions in either the listed or OTC markets.

Propane put/call options and swap agreements – The fair value of the propane put/call options and swap agreements are valued using market transactions for similar assets and liabilities in either the listed or OTC markets.

Level 3 Fair Value Measurements:

Investments- guaranteed income fund—The fair values of these investments are recorded at the contract value, which approximates their fair value.

At December 31, 2014, there were no non-financial assets or liabilities required to be reported at fair value. We review our non-financial assets for impairment at least on an annual basis, as required.

Other Financial Assets and Liabilities

Financial assets with carrying values approximating fair value include cash and cash equivalents and accounts receivable. Financial liabilities with carrying values approximating fair value include accounts payable and other accrued liabilities and short-term debt. The fair value of cash and cash equivalents is measured using the comparable value in the active market and approximates its carrying value (Level 1 measurement). The fair value of short-term debt approximates the carrying value due to its short maturities and because interest rates approximate current market rates (Level 3 measurement).

At December 31, 2014, long-term debt, which includes the current maturities but excludes a capital lease obligation, had a carrying value of $161.5 million, compared to a fair value of $180.7 million, using a discounted cash flow methodology that incorporates a market interest rate based on published corporate borrowing rates for debt instruments with similar terms and average maturities, adjusted for duration, optionality and risk profile. At December 31, 2013, long-term debt, which includes the current maturities of long-term debt, had a carrying value of $122.0 million, compared to the estimated fair value of $136.8 million. The valuation technique used to estimate the fair value of long-term debt would be considered a Level 3 measurement.

Note 16, Employee Benefit Plans, provides the fair value measurement information for our pension plan assets.