Pension and Other Postretirement Benefit Plans

6 Months Ended

Jun. 30, 2011

Compensation and Retirement Disclosure [Abstract]

Pension and Other Postretirement Benefit Plans

Pension and Other Postretirement Benefit Plans

PNMR and its subsidiaries maintain qualified defined benefit pension plans, postretirement benefit plans providing medical and dental benefits, and executive retirement programs (“PNM Plans” and “TNMP Plans”). PNMR maintains the legal obligation for the benefits owed to participants under these plans.

Information concerning pension and other postretirement plans is contained in Note 12 of Notes to Consolidated Financial Statements in the 2010 Annual Reports on Form 10-K. Annual net periodic benefit cost (income) for the plans is actuarially determined using the methods and assumptions set forth in that note and is recognized ratably throughout the year.

PNM Plans

The following table presents the components of the PNM Plans’ net periodic benefit cost:

	Three Months Ended June 30,
	Pension Plan						Other Postretirement Benefits						Executive Retirement Program
	2011			2010			2011			2010			2011		2010
	(In thousands)
Components of Net Periodic
Benefit Cost
Service cost	$	—		$	—		$	65		$	105		$	—	$	—
Interest cost	8,202			8,518			1,345			1,913			233		263
Long-term return on plan assets	(9,269		)	(9,339		)	(1,347		)	(1,393		)	—		—
Amortization of net loss	2,302			1,613			801			1,372			23		18
Amortization of prior service cost	79			79			(662		)	(1,036		)	—		—
Net periodic benefit cost	$	1,314		$	871		$	202		$	961		$	256	$	281

	Six Months Ended June 30,
	Pension Plan						Other Postretirement Benefits						Executive Retirement Program
	2011			2010			2011			2010			2011		2010
							(In thousands)
Components of Net Periodic
Benefit Cost
Service cost	$	—		$	—		$	129		$	210		$	—	$	—
Interest cost	16,402			17,037			2,689			3,825			465		527
Long-term return on plan assets	(18,537		)	(18,677		)	(2,694		)	(2,786		)	—		—
Amortization of net loss	4,605			3,225			1,603			2,744			47		35
Amortization of prior service cost	158			158			(1,324		)	(2,071		)	—		—
Net periodic benefit cost	$	2,628		$	1,743		$	403		$	1,922		$	512	$	562

PNM made contributions to its pension plan trust of $7.5 million and $13.5 million in the three months and six months ended June 30, 2011 and zero and $6.5 million in the three months and six months ended June 30, 2010. PNM anticipates making $28.0 million of additional contributions in 2011.  Based on current law and estimates of portfolio performance, PNM estimates making contributions to its pension plan trust that total $190.0 million for 2012- 2015. The estimated contributions were developed using probabilistically determined discount rates and expected returns on assets to calculate the pension liabilities. Actual amounts to be funded in the future will be dependent on the actuarial assumptions at that time, including the appropriate discount rate and return on assets. PNM contributed $1.2 million to the trust for other postretirement benefits for the three months and six months ended June 30, 2011 and $1.2 million for the three months and six months ended June 30, 2010. PNM expects to make contributions totaling $2.5 million during 2011 to the trust for other postretirement benefits.  Disbursements under the executive retirement program, which are funded by the Company and considered to be contributions to the plan, were $0.4 million and $0.8 million in the three months and six months ended June 30, 2011 and $0.4 million and $0.7 million in the three months and six months ended June 30, 2010 and are expected to total $1.5 million during 2011.

TNMP Plans

The following table presents the components of the TNMP Plans’ net periodic benefit cost (income):

	Three Months Ended June 30,
	Pension Plan						Other Postretirement Benefits						Executive Retirement Program
	2011			2010			2011			2010			2011		2010
							(In thousands)
Components of Net Periodic
Benefit Cost (Income)
Service cost	$	—		$	—		$	77		$	72		$	—	$	—
Interest cost	951			1,032			163			178			12		13
Long-term return on plan assets	(1,368		)	(1,449		)	(133		)	(129		)	—		—
Amortization of net (gain) loss	86			—			(48		)	(49		)	—		(1		)
Amortization of prior service cost	—			—			15			15			—		—
Net Periodic Benefit Cost (Income)	$	(331	)	$	(417	)	$	74		$	87		$	12	$	12

	Six Months Ended June 30,
	Pension Plan						Other Postretirement Benefits						Executive Retirement Program
	2011			2010			2011			2010			2011		2010
							(In thousands)
Components of Net Periodic
Benefit Cost (Income)
Service cost	$	—		$	—		$	153		$	144		$	—	$	—
Interest cost	1,900			2,063			327			356			23		26
Long-term return on plan assets	(2,735		)	(2,897		)	(267		)	(257		)	—		—
Amortization of net (gain) loss	173			—			(96		)	(98		)	—		(2		)
Amortization of prior service cost	—			—			30			30			—		—
Net Periodic Benefit Cost (Income)	$	(662	)	$	(834	)	$	147		$	175		$	23	$	24

TNMP made contributions to its pension plan trust of $0.1 million and $0.2 million in the three months and six months ended June 30, 2011 and no contributions in the three months and six months ended June 30, 2010. TNMP anticipates making additional contributions of $1.0 million in 2011. Based on current law and estimates of portfolio performance, TNMP estimates making contributions to its pension plan trust that total $6.5 million for 2012-2015. The estimated contributions were developed using probabilistically determined discount rates and expected returns on assets to calculate the pension liabilities. Actual amounts to be funded in the future will be dependent on the actuarial assumptions at that time, including the appropriate discount rate and return on assets. TNMP contributed $0.4 million to the trust for other postretirement benefits for the three months and six months ended June 30, 2011 and $0.6 million for the three months and six months ended June 30, 2010. TNMP does not expect to make additional contributions during 2011 to the trust for other postretirement benefits. Disbursements under the executive retirement program, which are funded by the Company and considered to be contributions to the plan, were less than $0.1 million in the three months and six months ended June 30, 2011 and 2010 and are expected to total $0.1 million during 2011.