EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2017

The funded status of the Plans and the net amount recognized in the statement of financial position are summarized as follows as of:



December 31,	2017			2016
(in thousands)
CHANGE IN ACCUMULATED BENEFIT OBLIGATION
Accumulated benefit obligation at beginning of year	$	197,222		$	200,375
Service cost	58			71
Interest cost	8,493			9,331
Actuarial (gain) loss	6,762			6,079
Benefits paid	(10,225		)	(18,634		)
Accumulated Benefit obligation at end of year	202,310			197,222
CHANGE IN PLAN ASSETS
Market value of plan assets at beginning of year	194,342			190,640
Actual return on plan assets	35,788			19,080
Employer contribution	—			3,256
Benefits paid	(10,225		)	(18,634		)
Fair value of plan assets at end of year	219,905			194,342
Funded status	$	17,595		$	(2,880	)

Schedule of amounts recognized in the statement of financial position



Amounts Recognized in the Statement of Financial Position consist of:
December 31,	2017		2016
(in thousands)
Noncurrent assets/(liabilities)	$	17,595	$	(2,880	)

Schedule of amounts recognized in accumulated other comprehensive income



Amounts Recognized in Accumulated Other Comprehensive Income consists of:
December 31,	2017		2016
(in thousands)
Net actuarial loss	$	61,598	$	80,662

Schedule of weighted-average assumptions used

The following weighted-average assumptions were used to determine the accumulated benefit obligation and net benefit cost:



December 31,	2017		2016		2015
ACCUMULATED BENEFIT OBLIGATION
Discount rate	4.00	%	4.45	%	4.70	%
Rate of compensation increase	N/A		N/A		N/A
NET BENEFIT COST
Discount rate	4.45	%	4.70	%	4.15	%
Expected return on plan assets	7.00	%	7.00	%	7.00	%
Rate of compensation increase	N/A		N/A		N/A

Schedule of net periodic benefit cost and other amounts recognized in other comprehensive income

The components of net periodic benefit cost are summarized as follows:



Years ended December 31,	2017			2016			2015
(in thousands)
Service cost	$	58		$	71		$	86
Interest cost	8,493			9,331			8,915
Expected return on plan assets	(13,368		)	(13,219		)	(12,788		)
Amortization of net loss	3,322			3,263			3,761
Preliminary net periodic benefit cost/(income)	$	(1,495	)	$	(554	)	$	(26	)
Settlement expense	53			—			—
Net periodic benefit cost	$	(1,442	)	$	(554	)	$	(26	)

Schedule of weighted average asset allocation along with target allocation

The benefit obligations recognized in other comprehensive income for the years ended December 31, 2017, 2016, and 2015 are summarized as follows:



(in thousands)	2017			2016			2015
Pretax (income)/loss	$	(15,650	)	$	218		$	(11,035	)
Amortization of net loss	(3,322		)	(3,263		)	(3,761		)
Total recognized in other comprehensive income	(18,972		)	(3,045		)	(14,796		)
Total recognized in net periodic benefit (income)/cost and other comprehensive income	$	(20,414	)	$	(3,599	)	$	(14,822	)

Schedule of plan assets using the fair value hierarchy

The Plans’ weighted average asset allocation at December 31, 2017 and 2016 by asset category, along with the target allocation for 2018, are as follows:



	Target allocations for				Percentage of plan assets as of December 31,
Asset category	2018				2017		2016
Cash and cash equivalents	0.0	%	-	5.0%	2.4	%	3.5	%
Equity securities - Rollins stock	0.0	%	-	40.0%	14.7	%	20.7	%
Domestic equity - all other	0.0	%	-	40.0%	21.8	%	21.7	%
International equity	0.0	%	-	30.0%	16.4	%	21.0	%
Debt securities - core fixed income	15.0	%	-	50.0%	35.2	%	23.5	%
Real estate	0.0	%	-	20.0%	6.5	%	6.4	%
Alternative/Opportunistic/Special	0.0	%	-	20.0%	3.0	%	3.2	%
Total					100.0	%	100.0	%

Schedule of reconciliation of level 3 assets



(in thousands)	Total		Level 1		Level 2		NAV
(1) Cash and cash equivalents	$	6,834	$	6,834	$	—	$	—
(2) Fixed income securities	45,673		—		45,673		—
Domestic equity securities
Rollins, Inc. stock	42,120		42,120		—		—
Other securities	40,178		11,614		28,564		—
(3) International equity securities	40,767		—		40,767		—
(4) Real estate	12,527		—		—		12,527
(5) Alternative/opportunistic/special	6,243		—		—		6,243
Total	$	194,342	$	60,568	$	115,004	$	18,770


(1)	Cash and cash equivalents, which are used to pay benefits and plan administrative expenses, are held in Rule 2a-7 money market funds.


(2)	Fixed income securities are primarily valued using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.


(3)	International equity securities are valued using a market approach based on the quoted market prices of identical instruments in their respective markets.


(4)	Real estate fund values are primarily reported by the fund manager and are based on valuation of the underlying investments, which include inputs such as cost, discounted future cash flows, independent appraisals and market based comparable data.

(5)

Alternative/Opportunistic/Special funds can invest across the capital structure in both liquid and illiquid securities that are valued using a market approach based on the quoted market prices of identical instruments, or if no market price is available, instruments will be held at their fair market value (which may be cost) as reasonably determined by the investment manager, independent dealers, or pricing services.



(in thousands)	Total		Level 1		Level 2		NAV
(1) Cash and cash equivalents	$	5,432	$	5,432
(2) Fixed income securities	77,214				77,214
Domestic equity securities
Rollins, Inc. stock	32,049		32,049
Other securities	48,511		16,243		32,268
(3) International equity securities	36,156				36,156
(4) Real estate	14,074						14,074
(5) Alternative/opportunistic/special	6,469						6,469
Total	$	219,905	$	53,724	$	145,638	$	20,543

Schedule of estimated future benefit payments

The estimated future benefit payments over the next five years are as follows:



(in thousands)
2018	$	11,500
2019	11,798
2020	12,105
2021	12,342
2022	12,597
Thereafter	63,788
Total	$	124,130

Schedule of estimated life insurance premium payments

The estimated life insurance premium payments over the next five years are as follows:



(in thousands)
2018	$	590
2019	614
2020	638
2021	664
2022	690
Total	$	3,196