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Employee Benefit Plans
 12 Months Ended
Dec. 31, 2022
Retirement Benefits [Abstract]  
Employee Benefit Plans Employee Benefit Plans
Employee benefits charged to operating expenses are summarized in the table below. Substantially all of the Company’s employees are covered by a defined contribution (401(k)) plan, under which the Company makes matching contributions.

(In thousands)202220212020
Payroll taxes$29,580 $28,084 $27,664 
Medical plans31,004 31,131 30,002 
401(k) plan18,590 17,237 16,834 
Pension plans516 388 410 
Other3,097 1,170 1,990 
Total employee benefits
$82,787 $78,010 $76,900 

A portion of the Company’s employees are covered by a noncontributory defined benefit pension plan, however, participation in the pension plan is not available to employees hired after June 30, 2003. All participants are fully vested in their benefit payable upon normal retirement date, which is based on years of participation and compensation. Since January 2011, all benefits accrued under the pension plan have been frozen. However, the accounts continue to accrue interest at a stated annual rate. Certain key executives also participate in a supplemental executive retirement plan (the CERP) that the Company funds only as retirement benefits are disbursed. The CERP carries no segregated assets. The CERP continues to provide credits based on hypothetical contributions in excess of those permitted under the 401(k) plan. In the tables presented below, the pension plan and the CERP are presented on a combined basis.

Under the Company’s funding policy for the defined benefit pension plan, contributions are made to a trust as necessary to satisfy the statutory minimum required contribution as defined by the Pension Protection Act, which is intended to provide for current service accruals and for any unfunded accrued actuarial liabilities over a reasonable period. To the extent that these
requirements are fully covered by assets in the trust, a contribution might not be made in a particular year. No contributions to the defined benefit plan were made in 2022, 2021 or 2020. The minimum required contribution for 2023 is expected to be zero. The Company does not expect to make any further contributions in 2023 other than the necessary funding contributions to the CERP. Contributions to the CERP were $14 thousand, $14 thousand and $80 thousand during 2022, 2021 and 2020, respectively.
The following items are components of the net pension cost for the years ended December 31, 2022, 2021 and 2020.

(In thousands)202220212020
Service cost-benefits earned during the year$516 $388 $410 
Interest cost on projected benefit obligation2,725 2,169 3,282 
Expected return on plan assets(4,515)(4,532)(5,214)
Amortization of prior service cost(271)(271)(271)
Amortization of unrecognized net (gain) loss1,717 2,578 2,138 
Net periodic pension cost$172 $332 $345 

The following table sets forth the pension plans’ funded status, using valuation dates of December 31, 2022 and 2021.

(In thousands)
20222021
Change in projected benefit obligation
Projected benefit obligation at prior valuation date
$121,738 $127,163 
Service cost
516388
Interest cost
2,725 2,169 
Benefits paid
(6,933)(6,735)
Actuarial (gain) loss
(22,204)(1,247)
Projected benefit obligation at valuation date
95,842 121,738 
Change in plan assets
Fair value of plan assets at prior valuation date
109,807 109,615 
Actual return on plan assets
(14,492)6,913 
Employer contributions
14 14 
Benefits paid
(6,933)(6,735)
Fair value of plan assets at valuation date
88,396 109,807 
Funded status and net amount recognized at valuation date
$(7,446)$(11,931)
The pension benefit obligation decreased from the prior year primarily due to an increase in the discount rate from 2.58% to 5.19%, which decreased the pension benefit liability by approximately $23.8 million. This decrease was slightly offset by updates to lump sum payment assumptions.

The accumulated benefit obligation, which represents the liability of a plan using only benefits as of the measurement date, was $95.8 million and $121.7 million for the combined plans on December 31, 2022 and 2021, respectively.
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss) at December 31, 2022 and 2021 are shown below, including amounts recognized in other comprehensive income during the periods. All amounts are shown on a pre-tax basis.

(In thousands)20222021
Prior service credit (cost)$452 $723 
Accumulated gain (loss)(23,363)(28,277)
Accumulated other comprehensive income (loss)
(22,911)(27,554)
Cumulative employer contributions in excess of net periodic benefit cost15,465 15,623 
Net amount recognized as an accrued benefit liability on the December 31 balance sheet
$(7,446)$(11,931)
Net gain (loss) arising during period
3,197 3,627 
Amortization of net (gain) loss
1,717 2,578 
Amortization of prior service cost
(271)(271)
Total recognized in other comprehensive income (loss)
$4,643 $5,934 
Total income (expense) recognized in net periodic pension cost and other comprehensive income
$4,471 $5,602 

The following assumptions, on a weighted average basis, were used in accounting for the plans.

202220212020
Determination of benefit obligation at year end:
Effective discount rate on benefit obligations5.19 %2.58 %2.25 %
Assumed cash balance interest crediting rate5.00 %5.00 %5.00 %
Determination of net periodic benefit cost for year ended:
Effective discount rate on benefit obligations2.64 %2.25 %3.08 %
Effective rate for interest cost on benefit obligations2.15 %1.63 %2.69 %
Long-term rate of return on assets4.25 %4.25 %5.00 %
Assumed cash balance interest crediting rate5.00 %5.00 %5.00 %
The following table shows the fair values of the Company’s pension plan assets by asset category at December 31, 2022 and 2021. Information about the valuation techniques and inputs used to measure fair value are provided in Note 17 on Fair Value Measurements.

Fair Value Measurements
(In thousands)
Total Fair Value
Quoted Prices in Active Markets for Identical Assets
(Level 1)
Significant Other Observable Inputs (Level 2)
Significant Unobservable Inputs (Level 3)
December 31, 2022
Assets:
U.S. government obligations$9,960 $9,960 $— $— 
Government-sponsored enterprise obligations (a)
1,022 — 1,022 — 
State and municipal obligations6,840 — 6,840 — 
Agency mortgage-backed securities (b)
2,871 — 2,871 — 
Non-agency mortgage-backed securities2,527 — 2,527 — 
Asset-backed securities6,768 — 6,768 — 
Corporate bonds (c)
35,234 — 35,234 — 
Equity securities and mutual funds: (d)
Mutual funds4,395 4,395 — — 
Common stocks15,868 15,868 — — 
International developed markets funds2,604 2,604 — — 
Emerging markets funds307 307 — — 
Total
$88,396 $33,134 $55,262 $— 
December 31, 2021
Assets:
U.S. government obligations
$6,824 $6,824 $— $— 
Government-sponsored enterprise obligations (a)
2,066 — 2,066 — 
State and municipal obligations
8,000 — 8,000 — 
Agency mortgage-backed securities (b)
3,266 — 3,266 — 
Non-agency mortgage-backed securities
2,974 — 2,974 — 
Asset-backed securities
7,648 — 7,648 — 
Corporate bonds (c)
40,832 — 40,832 — 
Equity securities and mutual funds: (d)
Mutual funds6,004 6,004 — — 
Common stocks27,702 27,702 — — 
International developed markets funds3,943 3,943 — — 
Emerging markets funds548 548 — — 
Total
$109,807 $45,021 $64,786 $— 
(a)    This category represents bonds (excluding mortgage-backed securities) issued by agencies such as the Government National Mortgage Association, the Federal Home Loan Mortgage Corp and the Federal National Mortgage Association.
(b)    This category represents mortgage-backed securities issued by the agencies mentioned in (a).
(c)    This category represents investment grade bonds issued in the U.S., primarily by domestic issuers, representing diverse industries.
(d)    This category represents investments in individual common stocks and equity funds. These holdings are diversified, largely across the financial services, technology services, electronic technology, healthcare technology, and retail trade industries.

The investment policy of the pension plan is designed for growth in principal, within limits designed to safeguard against significant losses within the portfolio. The policy sets guidelines, which may change from time to time, regarding the types and percentages of investments held. Currently, the policy includes guidelines such as holding bonds rated investment grade or better and prohibiting investment in Company stock. The plan does not utilize derivatives. Management believes there are no significant concentrations of risk within the plan asset portfolio at December 31, 2022. Under the current policy, the long-term investment target mix for the plan is 25% equity securities and 75% fixed income securities. The Company regularly reviews its policies on investment mix and may make changes depending on economic conditions and perceived investment risk.
The assumed overall expected long-term rate of return on pension plan assets used in calculating 2022 pension plan expense was 4.25%. Determination of the plan’s expected rate of return is based upon historical and anticipated returns of the asset classes invested in by the pension plan and the allocation strategy currently in place among those classes. The rate used in plan calculations may be adjusted by management for current trends in the economic environment. The 10-year annualized return for the Company’s pension plan was 5.0%. During 2022, the plan’s assets lost 12.0% of their value, compared to a gain of 5.9% in 2021. Returns for any plan year may be affected by changes in the stock market and interest rates. The Company expects to incur pension expense of $2.5 million in 2023, compared to $172 thousand in 2022.

The following future benefit payments are expected to be paid:

(In thousands)
2023$7,988 
20247,884 
20257,810 
20267,722 
20277,597 
2028 - 203234,819