Employee Benefit Plans

12 Months Ended

Dec. 31, 2011

Compensation and Retirement Disclosure [Abstract]

Pension and Other Postretirement Benefits Disclosure [Text Block]

Note 8. Employee Benefit Plans

The company’s defined benefit pension plan, covering full-time employees over 21 years of age upon completion of one year of service, was frozen as of October 31, 2009, the end of the plan year. Benefits will be based on average compensation for the five consecutive full calendar years of service which produces the highest average as of October 31, 2009. No additional participants may enter the plan, and there will be no further increases in benefits due to increases in salaries and years of service.

The company sponsors an unfunded postretirement life insurance plan covering certain retirees with 25 years of service who are over the age of 60 and an unfunded health care plan for certain retirees that met certain eligibility requirements. This plan is not available to future retirees.

The company sponsors a 401(k) retirement savings plan available to all employees meeting certain age and service requirements. Employees become eligible to participate in the plan upon reaching age 21 and completing one year of service. Entry dates are January 1, April 1, July 1 and October 1. Employees can make a salary deferral election authorizing the company to withhold up to the amount allowed by law each calendar year. The company may make a discretionary matching contribution each plan year. The company may also make other discretionary contributions to the plan. The company’s match for this plan has been increased with the freezing of the defined benefit plan as described above. The company made 401(k) matching contributions of $215 thousand, $214 thousand and $111 thousand in 2011, 2010 and 2009, respectively.

The company has entered into contracts with three retirees where the company has agreed to pay the beneficiaries of two participants $50,000 each and the beneficiary of one participant $25,000 at the death of the participants. This postretirement benefit has been accrued as of December 31, 2011. While these liabilities are unfunded, life insurance has been obtained by the company to help offset these payments.

Obligations and funded status:

							Other
	Pension Benefits						Postretirement Benefits
	2011			2010			2011			2010
	(in thousands)						(in thousands)
Change in benefit obligation:
Benefit obligation, beginning	$	7 656		$	6 962		$	625		$	568
Service cost		- -			- -			12			12
Interest cost		402			413			37			34
Change in assumptions		- -			- -			29			27
Actuarial loss (gain)		710			592			- -			- -
Amendment		- -			- -			(341	)		4
Benefits paid		(346	)		(311	)		(19	)		(20	)
Curtailment		- -			- -			- -			- -
Benefit obligation, ending	$	8 422		$	7 656		$	343		$	625
Change in plan assets:
Fair value of plan assets, beginning	$	6 098		$	5 621		$	- -		$	- -
Actual return on plan assets		155			443			- -			- -
Employer contributions		9			345			19			20
Benefits paid		(346	)		(311	)		(19	)		(20	)
Fair value of plan assets, ending	$	5 916		$	6 098		$	- -		$	- -
Funded status at end of year	$	(2 506	)	$	(1 558	)	$	(343	)	$	(625	)
Unrecognized net (gain)		- -			- -			- -			(21	)
Unrecognized transition asset		- -			- -			- -			70
Accounts recognized on consolidated
balance sheet as:
Accrued benefit liabilities	$	(2 506	)	$	(1 558	)	$	(343	)	$	(576	)
Amounts recognized in accumulated other
comprehensive loss consist of:
Net actuarial loss (gain)	$	3 235		$	2 354		$	- -		$	(21	)
Transition liability		- -			- -			- -			70
Deferred tax asset		(1 100	)		(800	)		- -			(17	)
	$	2 135		$	1 554		$	- -		$	32

The accumulated benefit obligation for the defined benefit pension plan was $8.4 million and $7.7 million at December 31, 2011 and 2010, respectively.

Components of net periodic benefit cost and other amounts recognized in accumulated other comprehensive loss:

										Other
	Pension Benefits									Postretirement Benefits
	2011			2010			2009			2011			2010			2009
	(in thousands)									(in thousands)
Components of net periodic benefit cost:
Service cost	$	- -		$	- -		$	266		$	12		$	12		$	12
Interest cost		402			413			447			37			34			32
Expected return on plan assets		(475	)		(460	)		(373	)		- -			- -			- -
Amortization of net obligation
at transition		- -			- -			- -			70			17			17
Recognized actuarial loss		- -			96			159			- -			- -			- -
Amortization of prior service cost		- -									(341	)		- -			- -
Amortization of Loss		150									8			- -			- -
Net periodic benefit cost	$	77		$	49		$	499		$	(214	)	$	63		$	61
Other changes in plan assets and benefit
obligations recognized in
other comprehensive loss:
Net actuarial loss (gain)	$	1 030		$	609		$	(201	)	$	21		$	31		$	1
Transition liability		- -			- -			- -			(70	)		(18	)		(17	)
Deferred tax		(299	)		(174	)		481			17			(4	)		5
Amortization of net (gain)		(150	)		(96	)		(159	)		- -			- -			- -
Adjustment to (gain) for curtailment		- -			- -			(1 054	)		- -			- -			- -
Total recognized in
accumulated other
comprehensive loss	$	581		$	339		$	(933	)	$	(32	)	$	9		$	(11	)
Total recognized in net periodic
benefit cost and accumulated
other comprehensive loss	$	658		$	388		$	(434	)	$	(246	)	$	72		$	50

The estimated net loss and prior service cost for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year approximates $212 thousand. The estimated unrecognized transition liability for the other defined benefit postretirement plan is zero due to the termination of benefits for current employees.

Assumptions

	Pension Benefits			Other Postretirement Benefits
	2011	2010	2009	2011	2010	2009
Weighted-average assumptions used to
determine net periodic benefit cost:
Discount rate	4.99%	6.08%	6.30%	5.70%	6.00%	6.00%
Expected return on plan assets	6.31%	8.00%	8.00%	- -	- -	- -
Rate of compensation increase	N/A	N/A	3.00%	3.00%	3.00%	3.00%
Weighted-average assumptions used to
determine benefit obligations:
Discount rate	4.99%	5.37%	6.08%	4.70%	5.70%	6.00%
Rate of compensation increase	N/A	N/A	N/A	N/A	3.00%	3.00%

Long-Term Rate of Return

The plan sponsor selects the expected long-term rate-of-return-on-assets assumption in consultation with their investment advisors and actuary. This rate is intended to reflect the average rate of earnings expected to be earned on the funds invested or to be invested to provide plan benefits. Historical performance is reviewed, especially with respect to real rates of return (net of inflation), for the major asset classes held or anticipated to be held by the trust, and for the trust itself. Undue weight is not given to recent experience that may not continue over the measurement period, with higher significance placed on current forecasts of future long-term economic conditions.

Because assets are held in a qualified trust, anticipated returns are not reduced for taxes. Further, solely for this purpose, the plan is assumed to continue in force and not terminate during the period during which assets are invested. However, consideration is given to the potential impact of current and future investment policy, cash flow into and out of the trust, and expenses (both investment and non-investment) typically paid from plan assets (to the extent such expenses are not explicitly estimated within periodic cost).

			Fair Value Measurement at December 31, 2011
			Quoted Prices in		Significant		Significant
			Active Markets for		Observable		Unobservable
			Identical		Inputs		Inputs
Asset Category	Total		Assets (Level 1)		(Level 2)		(Level 3)
Cash & cash equivalents	$	190	$	190	$	- -	$	- -
Equity securities
U.S. companies		1 830		1 830		- -		- -
International companies		465		465		- -		- -
U. S. Treasury securities		989		989		- -		- -
U. S. Corporate bonds		2 229		2 229		- -		- -
International Corporate bonds		213		213		- -		- -
Total	$	5 916	$	5 916	$	- -	$	- -
			Fair Value Measurement at December 31, 2010
			Quoted Prices in		Significant		Significant
			Active Markets for		Observable		Unobservable
			Identical		Inputs		Inputs
Asset Category	Total		Assets (Level 1)		(Level 2)		(Level 3)
Cash and cash equivalents	$	615	$	615	$	- -	$	- -
Equity securities
U.S. companies		2 502		2 502		- -		- -
International companies		646		646		- -		- -
U. S. Treasury securities		718		718		- -		- -
U. S. Corporate bonds		1 531		1 531		- -		- -
International Corporate bonds		86		86		- -		- -
Total	$	6 098	$	6 098	$	- -	$	- -

Asset Allocation

The pension plan’s weighted-average asset allocations at December 31, 2011 and 2010 by asset category are as follows:

	Plan Assets at December 31
	2011	2010
Asset Category
Equities	39%	52%
Fixed income/cash	61%	48%
Total	100%	100%

The trust fund is sufficiently diversified to maintain a reasonable level of risk without imprudently sacrificing return, with a targeted asset allocation of 50% equities and 50% fixed income/cash and acceptable ranges within these categories of 40% to 60%. The trust fund allocation is reviewed on a monthly basis and rebalanced to within the acceptable ranges as needed. The investment manager selects investment fund managers with demonstrated experience and expertise and funds with demonstrated historical performance for the implementation of the plan’s investment strategy. The investment manager will consider both actively and passively managed investment strategies and will allocate funds across the asset classes to develop an efficient investment structure.

It is the responsibility of the trustee to administer the investments of the trust within reasonable costs, being careful to avoid sacrificing quality. These costs include, but are not limited to, management and custodial fees, consulting fees, transaction costs and other administrative costs chargeable to the trust.

After review of the December 2011 allocations shown above, the funds were rebalanced and were within policy at February 29, 2012.

There is no company common stock included in the equity securities of the pension plan at December 31, 2011 and 2010.

Cash Flow

The company expects to contribute $2 million to its pension plan in 2012 and $18 thousand to its postretirement plan in 2012.

The following benefit payments (in thousands) are expected to be paid:

			Other
			Postretirement
	Pension Benefits		Benefits
2012	$	417	$	18
2013		435		19
2014		456		21
2015		472		24
2016		491		24
Thereafter		2 641		130

For measurement purposes, a 6.05%, 6.40% and 6.85% annual rate of increase in per capita health care costs of covered benefits was assumed for the retiree health care plan for 2011, 2010 and 2009, with such annual rate of increase gradually declining to 5% in 2013.

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A 1% change in assumed health care cost trend rates would have the following effects:

	1% Increase		1% Decrease
	(in thousands)
Effect on the health care component of the accumulated
postretirement benefit obligation	$	49	$	(42	)
Effect on total of service and interest cost components of
net periodic other postretirement health care benefit cost		9		(4	)