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Retirement Plans and Other Postretirement Benefits
 9 Months Ended
Sep. 30, 2018
Retirement Benefits [Abstract]  
Retirement Plans and Other Postretirement Benefits Retirement Plans and Other Postretirement Benefits
 
Pinnacle West sponsors a qualified defined benefit and account balance pension plan, a non-qualified supplemental excess benefit retirement plan, and an other postretirement benefit plan for the employees of Pinnacle West and our subsidiaries.  Pinnacle West uses a December 31 measurement date for its pension and other postretirement benefit plans.  The market-related value of our plan assets is their fair value at the measurement dates. Because of plan changes in September 2014, the Company sought IRS approval to move approximately $186 million of other postretirement benefit trust assets into a new trust account to pay for active union employee medical costs. In December 2016, FERC approved a methodology for determining the amount of other postretirement benefit trust assets to transfer into a new trust account to pay for active union
employee medical costs. On January 2, 2018, these funds were moved to the new trust account which is included in the other special use funds on the Condensed Consolidated Balance Sheets.  The Company negotiated a draft Closing Agreement granting tentative approval from the IRS prior to the transfer. Subsequent to the transfer, the Company submitted proof of the transfer to the IRS. The Company and the IRS executed a final Closing Agreement on March 2, 2018. Per the terms of an order from FERC, the Company must also make an informational filing with FERC. The Company made this FERC filing during February 2018. It is the Company’s understanding that completion of these regulatory requirements permits access to approximately $186 million for the sole purpose of paying active union employee medical benefits.

The following table provides details of the plans’ net periodic benefit costs and the portion of these costs charged to expense (including administrative costs and excluding amounts capitalized as overhead construction or billed to electric plant participants) (dollars in thousands):

 
Pension Benefits
 
Other Benefits
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
 
2018
 
2017
Service cost — benefits earned during the period
$
14,167

 
$
13,715

 
$
42,501

 
$
41,144

 
$
5,275

 
$
4,280

 
$
15,825

 
$
12,839

Non-service costs (credits):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest cost on benefit obligation
31,172

 
32,439

 
93,517

 
97,316

 
7,037

 
7,490

 
21,111

 
22,470

Expected return on plan assets
(45,713
)
 
(43,568
)
 
(137,140
)
 
(130,703
)
 
(10,520
)
 
(13,350
)
 
(31,561
)
 
(40,051
)
  Amortization of:
 

 
 
 
 

 
 

 
 

 
 

 
 

 
 

  Prior service cost (credit)
—

 
20

 
—

 
61

 
(9,461
)
 
(9,461
)
 
(28,382
)
 
(28,382
)
  Net actuarial loss
8,021

 
11,975

 
24,062

 
35,924

 
—

 
1,279

 
—

 
3,838

Net periodic benefit cost (credit)
$
7,647

 
$
14,581

 
$
22,940

 
$
43,742

 
$
(7,669
)
 
$
(9,762
)
 
$
(23,007
)
 
$
(29,286
)
Portion of cost (credit) charged to expense
$
2,524

 
$
7,231

 
$
7,535

 
$
21,692

 
$
(5,359
)
 
$
(4,841
)
 
$
(16,083
)
 
$
(14,523
)

 
On January 1, 2018, we adopted new accounting standard ASU 2017-07, Compensation-Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This new standard changed our income statement presentation of net periodic benefit cost/(credits) and allows only the service cost component of net periodic benefit cost to be eligible for capitalization. See Note 13 for additional information.

Contributions
 
We have made voluntary contributions of $50 million to our pension plan year-to-date in 2018. The minimum required contributions for the pension plan are zero for the next three years. We expect to make voluntary contributions up to a total of $250 million during the 2018-2020 period. We do not expect to make any contributions over the next three years to our other postretirement benefit plans. Year to date in 2018, the Company was reimbursed $72 million for prior years retiree medical claims from the other postretirement benefit plan trust assets.