Postretirement Medical and Life Insurance Benefit Plans

We and certain of our operating subsidiaries provide multiple postretirement medical and life insurance benefit plans. We recognize the cost of benefits as the employees render service. Postretirement benefits are funded as incurred. At the end of the year, we discount our plan liabilities using an assumed discount rate. In estimating this rate, we, along with our third-party actuaries, review bond indices, consider yield curve analysis results and the past history of discount rates.

The actuarial present value of benefit obligations summarized below was based on the following assumption:

	2011	2010
Weighted-average assumption as of June 30
Discount rate	5.29%	5.21%

The net periodic benefit costs were determined utilizing the following beginning-of-the-year assumptions:

	2011	2010	2009
Discount rate	5.21%	6.34%	6.65%
Health care cost trend rate	10.00%	10.00%	10.00%

Relevant information with respect to our postretirement medical and life insurance benefits as of June 30, can be summarized as follows:

	2011	2010
Change in benefit obligation
Benefit obligation at beginning of year	$ 2,707	$ 3,153
Service cost	24	17
Interest cost	137	193
Actuarial loss (gain)	220	(491)
Benefits paid	(207)	(165)
Benefit obligation at end of year	$ 2,881	$ 2,707
Change in plan assets
Employer contributions	$ 207	$ 165
Benefits paid	(207)	(165)
Fair value of plan assets at end of year	$ –	$ –
Reconciliation of funded status
Accrued benefit cost	$ (2,881)	$ (2,707)
Amounts recognized in the consolidated balance sheets consist of
Current accrued benefit liability	$ (203)	$ (169)
Noncurrent accrued benefit liability	$ (2,678)	$ (2,538)
Accumulated benefit obligation	$ (2,881)	$ (2,707)

Amounts recognized in accumulated other comprehensive loss at June 30 are as follows:

	2011	2010
Net actuarial gain	$ (745)	$ (1,011)
Prior service benefit	(28)	(33)
Income taxes	286	393
Total	$ (487)	$ (651)

Amounts in accumulated other comprehensive loss expected to be recognized as components of net periodic benefit cost during the next fiscal year are as follows:

			2012
	Prior service asset amortization		$ (5)
	Unrecognized gain amortization		(31)
	Total		$ (36)

The following table summarizes the components of net periodic benefit cost at June 30:

	2011	2010	2009
Components of net periodic benefit cost
Service cost	$ 24	$ 17	$ 17
Interest cost	137	193	198
Amortization of unrecognized net gain	(46)	(14)	(17)
Amortization of prior service asset	(5)	(5)	(5)
Net periodic benefit cost	$ 110	$ 191	$ 193

We expect to contribute approximately $0.2 million to our postretirement benefit plans in 2012.

Benefit payments estimated for future years are as follows:

	2012		$ 203
	2013		$ 207
	2014		$ 205
	2015		$ 205
	2016		$ 212
	2017 2021		$1,018

For other postretirement benefit measurement purposes, annual increases in medical costs for 2011 are assumed to total approximately 10% per year and gradually decline to 5% by approximately the year 2016 and remain level thereafter. Annual increases in medical costs for 2010 were assumed to total approximately 10% per year and gradually decline to 5% by approximately the year 2015 and remain level thereafter.

Assumed health care cost rates can have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effect:


	1-Percentage-Point Increase	1-Percentage-Point Decrease
Effect on total of service and interest cost components	$ 9	$ (8)
Effect on postretirement benefit obligation as of June 30, 2011	$ 171	$ (149)