PENSION AND OTHER POSTRETIREMENT BENEFITS (Tables)

12 Months Ended

Dec. 31, 2016

Compensation and Retirement Disclosure [Abstract]

Net periodic benefit cost related to the employee and officer pension and other postretirement benefit plans consisted of the following components (in thousands):



	Pension Benefits
	2016			2015			2014
Service Cost	$	4,843		$	5,337		$	4,510
Interest Cost	12,125			11,168			10,735
Expected Return on Plan Assets	(13,508		)	(14,789		)	(13,491		)
Amortizations:
Prior Service Cost	212			212			175
Actuarial Loss	9,394			10,608			5,716
Net Periodic Benefit Cost	13,066			12,536			7,645
Capitalized Benefit Costs	(4,645		)	(4,805		)	(3,047		)
Deferred Benefit Costs	(645		)	(1,007		)	—
Total Net Periodic Benefit Expense	$	7,776		$	6,724		$	4,598



	Other Postretirement Benefits
	2016			2015			2014
Service Cost	$	851		$	1,116		$	891
Interest Cost	2,615			2,973			2,852
Expected Return on Plan Assets	(3,104		)	(2,993		)	(2,603		)
Amortizations:
Prior Service (Credits) Cost	(344		)	608			152
Actuarial Loss	1,109			1,342			974
Net Periodic Benefit Cost	1,127			3,046			2,266
Capitalized Benefit Costs	(277		)	(1,043		)	(722		)
Deferred Benefit Costs	—			(256		)	—
Total Net Periodic Benefit Expense	$	850		$	1,747		$	1,544

Activity Within Regulatory Assets and Accumulated Other Comprehensive Income (Loss)

Details of the activity within the Regulatory Asset and Accumulated Other Comprehensive Loss associated with Pension and Other Postretirement Benefits are as follows (in thousands):



	Regulatory Assets						Accumulated Other Comprehensive Loss (pre-tax)
	Pension Benefits			Other Postretirement Benefits			Pension Benefits			Other Postretirement Benefits
Balance at January 1, 2015	$	71,177		$	27,863		$	39,468		$	6,755

Amounts Arising during the Period:
Net Actuarial (Loss)/Gain	(463		)	(3,155		)	59			(2,285		)
Prior Service Cost				(499		)				(106		)
Amounts Amortized to Net Periodic Costs:
Net Actuarial Loss	(6,079		)	(1,107		)	(4,452		)	(221		)
Prior Service Cost	(203		)	(7,755		)	(9		)	(2,081		)

Balance at December 31, 2015	64,432			15,347			35,066			2,062

Amounts Arising during the Period:
Net Actuarial Gain	9,706			2,584			8,370			829
Prior Service Credit	—			257			—			84
Amounts Amortized to Net Periodic Costs:
Net Actuarial Loss	(5,485		)	(945		)	(3,838		)	(154		)
Prior Service Cost	(203		)	—			(8		)	—

Balance at December 31, 2016	$	68,450		$	17,243		$	39,590		$	2,821

Estimated Costs That Will be Amortized from Regulatory Assets into Net Periodic Costs

The estimated costs that will be amortized from Regulatory Assets into net periodic benefit costs in 2017 are as follows (in thousands):



	Pension Benefits		Other Postretirement Benefits
Prior Service Cost/(Credit)	$	127	$	(257	)
Net Actuarial Loss	$	6,202	$	1,040

Estimated Costs That Will be Amortized from Accumulated Other Comprehensive Income (Loss) into Net Periodic Benefit Costs

The estimated costs that will be amortized from Accumulated Other Comprehensive Loss into net periodic benefit costs in 2017 are as follows (in thousands):



	Pension Benefits		Other Postretirement Benefits
Prior Service Cost/(Credit)	$	5	$	(87	)
Net Actuarial Loss	$	3,943	$	207

Reconciliation of the Plans' Benefit Obligations, Fair Value of Plan Assets and Funded Status

A reconciliation of the plans' benefit obligations, fair value of plan assets, funded status and amounts recognized in SJI's consolidated balance sheets follows (in thousands):



	Pension Benefits						Other Postretirement Benefits
	Pension Benefits						Other Postretirement Benefits
	2016			2015			2016			2015
Change in Benefit Obligations:
Benefit Obligation at Beginning of Year	$	254,195		$	265,434		$	57,430		$	75,592
Service Cost	4,843			5,337			851			1,116
Interest Cost	12,125			11,168			2,615			2,973
Actuarial Loss (Gain)	18,254			(17,349		)	3,121			(8,591		)
Retiree Contributions	—			—			81			700
Plan Amendments	—			—			—			(9,899		)
Benefits Paid	(11,129		)	(10,395		)	(3,748		)	(4,461		)
Benefit Obligation at End of Year	$	278,288		$	254,195		$	60,350		$	57,430

Change in Plan Assets:
Fair Value of Plan Assets at Beginning of Year	$	184,824		$	180,523		$	47,759		$	43,222
Actual Return on Plan Assets	13,569			(2,321		)	2,784			(423		)
Employer Contributions	2,278			17,017			3,656			8,721
Retiree Contributions	—			—			81			700
Benefits Paid	(11,129		)	(10,395		)	(3,748		)	(4,461		)
Fair Value of Plan Assets at End of Year	$	189,542		$	184,824		$	50,532		$	47,759


Funded Status at End of Year:	$	(88,746	)	$	(69,371	)	$	(9,818	)	$	(9,671	)
Amounts Related to Unconsolidated Affiliate	326			204			540			509
Accrued Net Benefit Cost at End of Year	$	(88,420	)	$	(69,167	)	$	(9,278	)	$	(9,162	)

Amounts Recognized in the Statement of Financial Position Consist of:
Current Liabilities	$	(2,463	)	$	(2,261	)	$	—		$	—
Noncurrent Liabilities	(85,957		)	(66,906		)	(9,278		)	(9,162		)
Net Amount Recognized at End of Year	$	(88,420	)	$	(69,167	)	$	(9,278	)	$	(9,162	)

Amounts Recognized in Regulatory Assets Consist of:
Prior Service Costs	$	538		$	741		$	(3,032	)	$	(3,289	)
Net Actuarial Loss	67,912			63,691			20,275			18,636
	$	68,450		$	64,432		$	17,243		$	15,347

Amounts Recognized in Accumulated Other Comprehensive Loss Consist of (pre-tax):
Prior Service Costs	$	69		$	77		$	(989	)	$	(1,074	)
Net Actuarial Loss	39,521			34,989			3,810			3,136
	$	39,590		$	35,066		$	2,821		$	2,062

Schedule of Weighted-Average Assumptions Used

The weighted-average assumptions used to determine benefit obligations at December 31 were:



	Pension Benefits				Other Postretirement Benefits
	2016		2015		2016		2015
Discount Rate	4.30	%	4.83	%	4.13	%	4.73	%
Rate of Compensation Increase	3.50	%	3.50	%	3.50	%	3.50	%

The weighted-average assumptions used to determine net periodic benefit cost for years ended December 31 were:



	Pension Benefits						Other Postretirement Benefits
	2016		2015		2014		2016		2015		2014
Discount Rate	4.83	%	4.25	%	5.09	%	4.73	%	4.20	%	4.91	%
Expected Long-Term Return on Plan Assets	7.50	%	7.75	%	7.75	%	6.50	%	6.25	%	6.25	%
Rate of Compensation Increase	3.50	%	3.50	%	3.50	%	3.50	%	3.50	%	3.50	%

Fair Value of Plan Assets

The fair values of SJI's pension plan assets at December 31, 2016 and 2015 by asset category are as follows (in thousands):



Asset Category	Total		Level 1		Level 2		Level 3
As of December 31, 2016
Cash / Cash Equivalents:
Cash	$	63	$	63	$	—	$	—
Common/Collective Trust Funds (a)	460		—		460		—
STIF-Type Instrument (b)	1,431		—		1,431		—
Equity securities:
Common/Collective Trust Funds - U.S. (a)	51,902		—		51,902		—
Common/Collective Trust Funds - International (a)	33,096		—		33,096		—
U.S. Large-Cap (c)	17,792		17,792		—		—
U.S. Mid-Cap (c)	2,479		2,479		—		—
International (c)	3,340		3,340		—		—
Fixed Income:
Common/Collective Trust Funds (a)	54,970		—		54,970		—
Guaranteed Insurance Contract (d)	9,714		—		—		9,714
Other types of investments:
Private Equity Fund (f)	5,100		—		—		5,100
Common/Collective Trust Fund - Real Estate (g)	9,195		—		—		9,195
Total	$	189,542	$	23,674	$	141,859	$	24,009



Asset Category	Total		Level 1		Level 2		Level 3
As of December 31, 2015
Cash / Cash Equivalents:
Cash	$	35	$	35	$	—	$	—
Common/Collective Trust Funds (a)	858		—		858		—
STIF-Type Instrument (b)	1,360		—		1,360		—
Equity securities:
Common/Collective Trust Funds - U.S. (a)	52,058		—		52,058		—
Common/Collective Trust Funds - International (a)	33,236		—		33,236		—
U.S. Large-Cap (c)	14,305		14,305		—		—
U.S. Mid-Cap (c)	3,407		3,407		—		—
U.S. Small-Cap (c)	260		260		—		—
International (c)	1,695		1,695		—		—
Fixed Income:
Common/Collective Trust Funds (a)	50,664		—		50,664		—
Guaranteed Insurance Contract (d)	9,960		—		—		9,960
Hedge Funds (e)	4,159		—		—		4,159
Other types of investments:
Private Equity Fund (f)	4,312		—		—		4,312
Common/Collective Trust Fund - Real Estate (g)	8,515		—		—		8,515
Total	$	184,824	$	19,702	$	138,176	$	26,946

(a)

This category represents common/collective trust fund investments through a commingled employee benefit trust (excluding real estate). These commingled funds are not traded publicly; however, the majority of the underlying assets held in these funds are stocks and bonds that are traded on active markets and prices for these assets are readily observable. Also included in these funds are interest rate swaps, asset-backed securities, mortgage-backed securities and other investments with observable market values. Holdings in these commingled funds are classified as Level 2 investments.

(b)

This category represents short-term investment funds held for the purpose of funding disbursement payment arrangements. Underlying assets are valued based on quoted prices in active markets, or where quoted prices are not available, based on models using observable market information. Since not all values can be obtained from quoted prices in active markets, these funds are classified as Level 2 investments.


(c)	This category of equity investments represents a managed portfolio of common stock investments in five sectors: telecommunications, electric utilities, gas utilities, water and energy. These common stocks are actively traded on exchanges and price quotes for these shares are readily available. These common stocks are classified as Level 1 investments.

(d)

This category represents SJI's Group Annuity contracts with a nationally recognized life insurance company. The contracts are the assets of the plan, while the underlying assets of the contracts are owned by the contract holder. Valuation is based on a formula and calculation specified within the contract. Since the valuation is based on the reporting entity's own assumptions, these contracts are classified as Level 3 investments.


(e)	This category represents a collection of underlying funds which are all domiciled outside of the United States. All of the underlying fund managers are based in the U.S.; however, they do not necessarily trade only in U.S. markets. The fair value of these funds is determined by the underlying fund's general partner or manager. These funds are classified as Level 3 investments.

(f)

This category represents a limited partnership/commingled trust which includes several investments in U.S. leveraged buyout, venture capital, and special situation funds. Fund valuations are reported on a 90 to 120 day lag and, therefore, the value reported herein represents the market value as of June 30 or September 30, 2015 and 2014, respectively, with cash flow changes through December applied. The fund's investments are stated at fair value, which is generally based on the valuations provided by the general partners or managers of such investments. Fund investments are illiquid and resale is restricted. These funds are classified as Level 3 investments.

(g)

This category represents real estate common/collective trust fund investments through a commingled employee benefit trust. These commingled funds are part of a direct investment in a pool of real estate properties. These funds are valued by investment managers on a periodic basis using pricing models that use independent appraisals from sources with professional qualifications. Since these valuation inputs are not highly observable, the real estate funds are classified as Level 3 investments.

The fair values of SJI's other postretirement benefit plan assets at December 31, 2016 and 2015 by asset category are as follows (in thousands):



Asset Category	Total		Level 1		Level 2		Level 3
As of December 31, 2016:
Cash	$	—	$	—	$	—	$	—
Equity Securities:
Common/Collective Trust Funds - U.S. (a)	$	14,878	$	—	$	14,878	$	—
Common/Collective Trust Funds - International (a)	8,674		—		8,674		—
Fixed Income:
Common/Collective Trust Funds - Bonds (a)	13,537		—		13,537		—
Other Types of Investments:
Company Owned Life Insurance (c)	13,443		—		13,443		—
Total	$	50,532	$	—	$	50,532	$	—

Asset Category	Total		Level 1		Level 2		Level 3
As of December 31, 2015:
Cash	$	26	$	26	$	—	$	—
Equity Securities:
Common/Collective Trust Funds - U.S. (a)	$	13,522	$	—	$	13,522	$	—
Common/Collective Trust Funds - International (a)	8,313		—		8,313		—
Mutual Fund - U.S. (b)	1,309		1,309		—		—
Mutual Funds - International (b)	983		983		—		—
Fixed Income:
Common/Collective Trust Funds - Bonds (a)	13,187		—		13,187		—
Mutual Funds - Bonds (b)	1,441		1,441		—		—
Other Types of Investments:
Mutual Funds - REITS (b)	152		152		—		—
Company Owned Life Insurance (c)	8,826		—		8,826		—
Total	$	47,759	$	3,911	$	43,848	$	—

(a)


(b)	This category represents mutual fund investments. The mutual funds are actively traded on exchanges and price quotes for the shares are readily available. These mutual funds are classified as Level 1 investments.


(c)	This category represents Company-owned life insurance policies with a nationally known life insurance company. The value of these policies is backed by a series of common/collective trust funds held by the insurance carrier similar to category (a) above. Holdings in these insurance policies are classified as Level 2 investments.

Schedule of Effect of Significant Unobservable Inputs, Changes in Plan Assets



	Guaranteed						Private
	Insurance			Hedge			Equity			Real
	Contract			Funds			Funds			Estate		Total

Balance at January 1, 2015	$	10,912		$	4,331		$	3,616		$	7,476	$	26,335
Actual return on plan assets:
Relating to assets still held at the reporting date	(106		)	(172		)	(302		)	1,039		459
Relating to assets sold during the period	25			—			429			—		454
Purchases, Sales and Settlements	(871		)	—			569			—		(302		)
Balance at December 31, 2015	9,960			4,159			4,312			8,515		26,946
Actual return on plan assets:
Relating to assets still held at the reporting date	541			(67		)	(140		)	680		1,014
Relating to assets sold during the period	14			—			245			—		259
Purchases, Sales and Settlements	(801		)	(4,092		)	683			—		(4,210		)
Balance at December 31, 2016	$	9,714		$	—		$	5,100		$	9,195	$	24,009

Schedule of Future Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the following years (in thousands):



	Pension Benefits		Other Postretirement Benefits
2017	$	12,141	$	4,399
2018	$	12,583	$	4,316
2019	$	13,529	$	4,403
2020	$	14,056	$	4,514
2021	$	14,757	$	4,511
2022 - 2025	$	86,727	$	21,308