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Retirement Benefit Obligations
 3 Months Ended
Mar. 31, 2015
Retirement Benefit Obligations

NOTE 9: RETIREMENT BENEFIT OBLIGATIONS

The Company co-sponsors the Unitil Corporation Retirement Plan (Pension Plan), the Unitil Retiree Health and Welfare Benefits Plan (PBOP Plan), and the Unitil Corporation Supplemental Executive Retirement Plan (SERP) to provide certain pension and postretirement benefits for its retirees and current employees. Please see Note 10 to the Consolidated Financial Statements in the Company’s Form 10-K for the year ended December 31, 2014 as filed with the SEC on January 28, 2015 for additional information regarding these plans.

The following table includes the key weighted average assumptions used in determining the Company’s benefit plan costs and obligations:

 

     2015     2014  

Used to Determine Plan Costs

     

Discount Rate

      4.00 %      4.80 % 

Rate of Compensation Increase

      3.00 %      3.00 % 

Expected Long-term rate of return on plan assets

      8.00 %      8.00 % 

Health Care Cost Trend Rate Assumed for Next Year

      6.00 %      7.00 % 

Ultimate Health Care Cost Trend Rate

      4.00 %      4.00 % 

Year that Ultimate Health Care Cost Trend Rate is reached

      2018        2018   

The following table provides the components of the Company’s Retirement plan costs ($000’s):

 

     Pension Plan     PBOP Plan     SERP  

Three Months Ended March 31,

    2015     2014     2015     2014     2015      2014  

Service Cost

    $ 916      $ 751      $ 656      $ 497      $ 28       $ 14   

Interest Cost

      1,343        1,273        729        672        78         68   

Expected Return on Plan Assets

      (1,694 )     (1,561 )     (273 )      (230 )      —           —     

Prior Service Cost Amortization

      54        53        420        420        3         3   

Actuarial Loss Amortization

      1,180        712        288        14        84         25   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Sub-total

      1,799       1,228       1,820        1,373        193         110   

Amounts Capitalized and Deferred

      (708 )      (344 )      (760 )      (473 )      —           —     
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Net Periodic Benefit Cost Recognized

    $ 1,091      $ 884      $ 1,060      $ 900      $ 193       $ 110   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

 

Employer Contributions

As of March 31, 2015, the Company had made $0.9 million of contributions to its Pension Plan in 2015 and had not made any contributions to its PBOP Plan in 2015. The Company, along with its subsidiaries, expects to continue to make contributions to its Pension and PBOP Plans in 2015 and future years at minimum required and discretionary funding levels consistent with the amounts recovered in the distribution utilities’ rates for these Pension and PBOP Plan costs.

As of March 31, 2015, the Company had made $13,000 of contributions to the SERP Plan in 2015. The Company presently anticipates contributing an additional $40,000 to the SERP Plan in 2015.