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Fair Value Of Financial Instruments
 12 Months Ended
Dec. 31, 2016
Fair Value Of Financial Instruments [Abstract]  
Fair Value Of Financial Instruments

(18)Fair Value of Financial Instruments:

Fair value is defined under GAAP as the exit price associated with the sale of an asset or transfer of a liability in an orderly transaction between market participants at the measurement date. Valuation techniques used to measure fair value under GAAP must maximize the use of observable inputs and minimize the use of unobservable inputs. In addition, GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

The three input levels in the hierarchy of fair value measurements are defined by the FASB generally as follows:

Input Level      Description of Input

Level 1            Observable inputs such as quoted prices in active markets for identical assets.

Level 2            Inputs other than quoted prices in active markets that are either directly or indirectly observable.

Level 3            Unobservable inputs in which little or no market data exists.



The following tables represent Frontier’s pension plan assets measured at fair value on a recurring basis as of December 31, 2016 and 2015:  









 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 



 

Fair Value Measurements at December 31, 2016

 

($ in millions)

 

Total

 

Level 1

 

Level 2

 

Level 3

 

Cash and Cash Equivalents

 

$

 42 

 

$

 42 

 

$

 -

 

$

 -

 

U.S. Government Obligations

 

 

 29 

 

 

 -

 

 

 29 

 

 

 -

 

Corporate and Other Obligations

 

 

 400 

 

 

 -

 

 

 400 

 

 

 -

 

Common Stock

 

 

 487 

 

 

 487 

 

 

 -

 

 

 -

 

Common/Collective Trusts

 

 

 1,104 

 

 

 -

 

 

 1,104 

 

 

 -

 

Interest in Registered Investment Companies

 

 

 334 

 

 

 334 

 

 

 -

 

 

 -

 

Interest in Limited Partnerships and

 

 

 

 

 

 

 

 

 

 

 

 

 

Limited Liability Companies

 

 

 118 

 

 

 -

 

 

 -

 

 

 118 

 

Total investments at fair value

 

$

 2,514 

 

$

 863 

 

$

 1,533 

 

$

 118 

 

Receviable for plan assets of the CTF Operations

 

 

 258 

 

 

 

 

 

 

 

 

 

 

Interest and Dividend Receivable

 

 

 6 

 

 

 

 

 

 

 

 

 

 

Due from Broker for Securities Sold

 

 

 27 

 

 

 

 

 

 

 

 

 

 

Receivable Associated with Insurance Contract

 

 

 7 

 

 

 

 

 

 

 

 

 

 

Due to Broker for Securities Purchased

 

 

 (46)

 

 

 

 

 

 

 

 

 

 

Total Plan Assets, at Fair Value

 

$

 2,766 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 









 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

($ in millions)

 

Fair Value Measurements at December 31, 2015



 

Total

 

Level 1

 

Level 2

 

Level 3

Cash and Cash Equivalents

 

$

 23 

 

$

 23 

 

$

 -

 

$

 -

U.S. Government Obligations

 

 

 32 

 

 

 -

 

 

 32 

 

 

 -

Corporate and Other Obligations

 

 

 315 

 

 

 -

 

 

 315 

 

 

 -

Common Stock

 

 

 178 

 

 

 178 

 

 

 -

 

 

 -

Common/Collective Trusts

 

 

 894 

 

 

 -

 

 

 894 

 

 

 -

Interest in Registered Investment Companies

 

 

 49 

 

 

 49 

 

 

 -

 

 

 -

Interest in Limited Partnerships and

 

 

 

 

 

 

 

 

 

 

 

 

Limited Liability Companies

 

 

 92 

 

 

 -

 

 

 -

 

 

 92 

Total investments at fair value

 

$

 1,583 

 

$

 250 

 

$

 1,241 

 

$

 92 

Interest and Dividend Receivable

 

 

 4 

 

 

 

 

 

 

 

 

 

Due from Broker for Securities Sold

 

 

 21 

 

 

 

 

 

 

 

 

 

Receivable Associated with Insurance Contract

 

 

 7 

 

 

 

 

 

 

 

 

 

Due to Broker for Securities Purchased

 

 

 (43)

 

 

 

 

 

 

 

 

 

Total Plan Assets, at Fair Value

 

$

 1,572 

 

 

 

 

 

 

 

 

 



There have been no reclassifications of investments between Levels 1, 2 or 3 assets during the years ended December 31, 2016 or 2015.



The tables below set forth a summary of changes in the fair value of the Plan’s Level 3 assets for the years ended December 31, 2016 and 2015:







 

 

 

 

 

 

 



 

 

 

 

 

 

 



 

Interest in Limited Partnerships and Limited Liability Companies

 

($ in millions)

 

2016

 

2015

 

Balance, beginning of year

 

$

 92 

 

$

 103 

 

Realized gains

 

 

 7 

 

 

 8 

 

Unrealized losses

 

 

 13 

 

 

 (11)

 

Purchases

 

 

 15 

 

 

 -

 

Sales and distributions

 

 

 (9)

 

 

 (8)

 

Balance, end of year

 

$

 118 

 

$

 92 

 



 

 

 

 

 

 

 



The following table provides further information regarding the redemption of the Plan’s Level 3 investments as of December 31, 2016:







 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

($ in millions)

 

Fair Value

 

Redemption Frequency

 

Redemption Notice Period

 

Liquidation Period

Interest in Limited Partnerships and Limited

 

 

 

 

 

 

 

 

 

 

 

 

Liability Companies

 

 

 

 

 

 

 

 

 

 

 

 

MS IFHF SVP LP Cayman (a)

 

$

 1 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

4 years

MS IFHF SVP LP Alpha (a)

 

 

 1 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

4 years

RII World Timberfund, LLC (b)

 

 

 6 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

10 years

426 E Casino Road, LLC (c)

 

 

 15 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

100 Comm Drive, LLC (c)

 

 

 9 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

100 CTE Drive, LLC (c)

 

 

 13 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

6430 Oakbrook Parkway, LLC (c)

 

 

 25 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

8001 West Jefferson, LLC (c)

 

 

 26 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

1500 MacCorkle Ave SE, LLC (c)

 

 

 14 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

400 S. Pike Road West, LLC (c)

 

 

 1 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

601 N US 131, LLC (c)

 

 

 1 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

9260 E. Stockton Blvd., LLC (c)

 

 

 6 

 

 

Through liquidation of
underlying investments

 

 

None

 

 

NA

Total Interest in Limited Partnerships and Limited

 

 

 

 

 

 

 

 

 

 

 

 

Liability Companies

 

$

 118 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 



(a)

The partnerships’ investment objective is to seek capital appreciation principally through investing in investment funds managed by third party investment managers who employ a variety of alternative investment strategies. These instruments are subject to certain withdrawal restrictions. The Plan is in the process of liquidating its interest in the partnerships and distributions are expected to be made over the next four years.



(b)

The fund’s objective is to realize substantial long-term capital appreciation by investing in timberland properties primarily in South America and Australia.  This investment is subject to certain withdrawal restrictions.



(c)

The entity invests in commercial real estate properties that are leased to Frontier.  The leases are triple net, whereby Frontier is responsible for all expenses, including but not limited to, insurance, repairs and maintenance and payment of property taxes.



















The following table represents the Plan’s Level 3 financial instruments for its interest in certain limited partnerships and limited liability companies, which all use the direct capitalization valuation technique to measure the fair value of those financial instruments as of December 31, 2016, and the significant unobservable inputs and ranges of values for those inputs:









 

 

 

 

 



 

 

 

 

 

Instrument

Property

 

Fair Value

Capitalization Rate

 



 

 

 

 

 



426 E. Casino Road, LLC

$

 15  7.00% 

 



 

 

 

 

 



 

 

 

 

 



100 Comm Drive, LLC

$

 9  7.75% 

 



 

 

 

 

 



 

 

 

 

 



100 CTE Drive, LLC

$

 13  9.00% 

 



 

 

 

 

 



 

 

 

 

 



6430 Oakbrook Parkway, LLC

$

 25  7.75% 

 



 

 

 

 

 

Interest in

 

 

 

 

 

Limited Partnerships

8001 West Jefferson, LLC

$

 26  8.50% 

 

and Limited Companies

 

 

 

 

 



 

 

 

 

 



1500 MacCorkle Ave SE, LLC

$

 14  8.25% 

 



 

 

 

 

 



 

 

 

 

 



400 S. Pike Road West, LLC

$

 1  8.50% 

 



 

 

 

 

 



 

 

 

 

 



601 N US 131, LLC

$

 1  9.50% 

 



 

 

 

 

 



 

 

 

 

 



9260 E. Stockton Blvd., LLC

$

 6  7.50% 

 



 

 

 

 

 



 

 

 

 

 



The following table summarizes the carrying amounts and estimated fair values for long-term debt at December 31, 2016 and 2015.  For the other financial instruments including cash, accounts receivable, restricted cash, long-term debt due within one year, accounts payable and other current liabilities, the carrying amounts approximate fair value due to the relatively short maturities of those instruments. 







 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 



 

2016

 

2015



 

 

 

 

 

 

 

 

 

 

 

 



 

 

Carrying

 

 

 

 

 

Carrying

 

 

 

($ in millions)

 

 

Amount

 

 

Fair Value

 

 

Amount

 

 

Fair Value



 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt

 

$

 17,560 

 

$

 17,539 

 

$

 15,508 

 

$

 14,767 



The fair value of our long-term debt is estimated based upon quoted market prices at the reporting date for those financial instruments.