Employee Benefit Plans

9 Months Ended

Sep. 30, 2012

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

Employee Benefit Plans

The Company maintains a non-contributory defined benefit pension plan (sometimes referred to as the “qualified pension plan”) for certain employees who were employed at December 31, 2011. On December 31, 2010, the Company froze the qualified pension plan for its non-union participants and formed a new defined contribution feature within the Badger Meter Employee Savings and Stock Ownership Plan (“ESSOP”) in which each employee received a similar benefit. On December 31, 2011, the Company froze the qualified pension plan for its union participants and included them in the defined contribution feature within the ESSOP. After December 31, 2011, employees will not receive any new benefits under the qualified pension plan as benefits have been frozen and the employees now participate in the defined contribution feature of the ESSOP instead. Employees will continue to earn returns on their frozen balances under the qualified pension plan. The Company also maintains a non-contributory postretirement plan that provides medical benefits for certain of its retirees and eligible dependents in the United States.

The following table sets forth the components of net periodic benefit cost for the three months ended September 30, 2012 and 2011 based on December 31, 2011 and 2010 actuarial measurement dates, respectively:

	Defined pension plan benefits						Other postretirement benefits
(In thousands)	2012			2011			2012		2011
Service cost – benefits earned during the year	$	12		$	107		$	36	$	37
Interest cost on projected benefit obligations	564			605			74		81
Expected return on plan assets	(797		)	(936		)	—		—
Amortization of prior service cost	—			49			40		40
Amortization of net loss	184			448			—		—
Net periodic benefit cost (income)	$	(37	)	$	273		$	150	$	158

The following table sets forth the components of net periodic benefit cost for the nine months ended September 30, 2012 and 2011 based on December 31, 2011 and 2010 actuarial measurement dates, respectively:

	Defined pension plan benefits						Other postretirement benefits
(In thousands)	2012			2011			2012		2011
Service cost – benefits earned during the year	$	36		$	393		$	107	$	111
Interest cost on projected benefit obligations	1,691			1,859			221		243
Expected return on plan assets	(2,392		)	(2,825		)	—		—
Amortization of prior service cost	—			147			121		120
Amortization of net loss	553			1,346			—		—
Net periodic benefit cost (income)	$	(112	)	$	920		$	449	$	474

The Company disclosed in its financial statements for the year ended December 31, 2011 that it estimated it would make a contribution in 2012 of $1.9 million due to the reduction in the market value of the underlying investments as of the December 31, 2011 actuarial measurement date. As a result of recent law changes, the Company has funded $1.1 million as of September 30, 2012 related to the 2011 pension plan year. The Company believes no additional contributions will be required during 2012.

The Company also disclosed in its financial statements for the year ended December 31, 2011 that it estimated it would pay $0.5 million in other postretirement benefits in 2012 based on actuarial estimates. As of September 30, 2012, $0.4 million of such benefits have been paid. The Company continues to believe that its estimated payments for the full year are reasonable. However, such estimates contain inherent uncertainties because cash payments can vary significantly depending on the timing of postretirement medical claims and the collection of the retirees’ portion of certain costs. Note that the amount of benefits paid in calendar year 2012 will not impact the expense for postretirement benefits for 2012.