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INVESTMENT IN TRANSMISSION AFFILIATES | 6 Months Ended
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Jun. 30, 2019
Equity Method Investments and Joint Ventures [Abstract] |
INVESTMENT IN TRANSMISSION AFFILIATES | INVESTMENT IN TRANSMISSION AFFILIATES We own approximately 60% of ATC, a for-profit, transmission-only company regulated by the FERC for cost of service and certain state regulatory commissions for routing and siting of transmission projects. We also own approximately 75% of ATC Holdco, a separate entity formed in December 2016 to invest in transmission-related projects outside of ATC's traditional footprint. The following tables provide a reconciliation of the changes in our investments in ATC and ATC Holdco:
|  | Three Months Ended June 30, 2019
(in millions) |  | ATC |  | ATC Holdco |  | Total
Balance at beginning of period |  | $ | 1,630.6 |  |  | $ | 40.0 |  |  | $ | 1,670.6 |
Add: Earnings (loss) from equity method investment |  | 37.4 |  |  | (0.5 | ) |  | 36.9 |
Add: Capital contributions |  | 18.1 |  |  | 0.4 |  |  | 18.5 |
Less: Distributions |  | 29.4 |  |  | — |  |  | 29.4 |
Less: Other |  | 0.1 |  |  | — |  |  | 0.1 |
Balance at end of period |  | $ | 1,656.6 |  |  | $ | 39.9 |  |  | $ | 1,696.5 |
|  | Three Months Ended June 30, 2018
(in millions) |  | ATC |  | ATC Holdco |  | Total
Balance at beginning of period |  | $ | 1,561.1 |  |  | $ | 37.8 |  |  | $ | 1,598.9 |
Add: Earnings (loss) from equity method investment |  | 29.8 |  |  | (1.1 | ) |  | 28.7 |
Add: Capital contributions |  | 18.1 |  |  | 1.5 |  |  | 19.6 |
Less: Distributions |  | 50.7 |  |  | — |  |  | 50.7 |
Add: Other |  | 0.1 |  |  | — |  |  | 0.1 |
Balance at end of period |  | $ | 1,558.4 |  |  | $ | 38.2 |  |  | $ | 1,596.6 |
|  | Six Months Ended June 30, 2019
(in millions) |  | ATC |  | ATC Holdco |  | Total
Balance at beginning of period |  | $ | 1,625.3 |  |  | $ | 40.0 |  |  | $ | 1,665.3 |
Add: Earnings (loss) from equity method investment |  | 73.9 |  |  | (0.9 | ) |  | 73.0 |
Add: Capital contributions |  | 21.1 |  |  | 0.8 |  |  | 21.9 |
Less: Distributions |  | 63.6 |  |  | — |  |  | 63.6 |
Less: Other |  | 0.1 |  |  | — |  |  | 0.1 |
Balance at end of period |  | $ | 1,656.6 |  |  | $ | 39.9 |  |  | $ | 1,696.5 |
|  | Six Months Ended June 30, 2018
(in millions) |  | ATC |  | ATC Holdco |  | Total
Balance at beginning of period |  | $ | 1,515.8 |  | (1) | $ | 37.6 |  |  | $ | 1,553.4 |
Add: Earnings (loss) from equity method investment |  | 63.2 |  |  | (1.7 | ) |  | 61.5 |
Add: Capital contributions |  | 30.1 |  |  | 2.3 |  |  | 32.4 |
Less: Distributions |  | 50.7 |  | (2) | — |  |  | 50.7 |
Balance at end of period |  | $ | 1,558.4 |  |  | $ | 38.2 |  |  | $ | 1,596.6 |
(1) | Distributions of $39.9 million, received in the first quarter of 2018, were approved and recorded as a receivable from ATC in other current assets at December 31, 2017.
(2) | Distributions of $24.2 million, received in the third quarter of 2018, were approved and recorded as a receivable from ATC in accounts receivable at June 30, 2018.
We pay ATC for network transmission and other related services it provides. In addition, we provide a variety of operational, maintenance, and project management work for ATC, which is reimbursed by ATC. We are required to pay the cost of needed transmission infrastructure upgrades for new generation projects while the projects are under construction. ATC reimburses us for these costs when the new generation is placed in service. The following table summarizes our significant related party transactions with ATC:
|  | Three Months Ended June 30 |  | Six Months Ended June 30
(in millions) |  | 2019 |  | 2018 |  | 2019 |  | 2018
Charges to ATC for services and construction |  | $ | 3.3 |  |  | $ | 4.1 |  |  | $ | 7.3 |  |  | $ | 8.7 |
Charges from ATC for network transmission services |  | 87.0 |  |  | 84.6 |  |  | 174.1 |  |  | 169.1 |
Refund from ATC related to a FERC audit |  | — |  |  | 22.0 |  |  | — |  |  | 22.0 |
Our balance sheets included the following receivables and payables for services received from or provided to ATC:
(in millions) |  | June 30, 2019 |  | December 31, 2018
Accounts receivable for services provided to ATC |  | $ | 2.3 |  |  | $ | 3.4 |
Accounts payable for services received from ATC |  | 29.0 |  |  | 28.2 |
Amounts due from ATC for transmission infrastructure upgrades* |  | — |  |  | 29.4 |
* | In connection with UMERC's construction of the new natural gas-fired generation in the Upper Peninsula of Michigan, UMERC was required to initially fund the construction of the transmission infrastructure upgrades owned by ATC that are needed for the new generation. In the second quarter of 2019, ATC fully reimbursed UMERC for these costs.
Summarized financial data for ATC is included in the following tables:
|  | Three Months Ended June 30 |  | Six Months Ended June 30
(in millions) |  | 2019 |  | 2018 |  | 2019 |  | 2018
Income statement data |  |  |  |  |  |  |  |
Operating revenues |  | $ | 182.2 |  |  | $ | 165.5 |  |  | $ | 359.9 |  |  | $ | 330.9 |
Operating expenses |  | 93.6 |  |  | 91.5 |  |  | 184.0 |  |  | 176.4 |
Other expense, net |  | 28.6 |  |  | 25.4 |  |  | 57.4 |  |  | 53.0 |
Net income |  | $ | 60.0 |  |  | $ | 48.6 |  |  | $ | 118.5 |  |  | $ | 101.5 |
(in millions) |  | June 30, 2019 |  | December 31, 2018
Balance sheet data |  |  |  |
Current assets |  | $ | 88.8 |  |  | $ | 87.2 |
Noncurrent assets |  | 5,100.7 |  |  | 4,928.8 |
Total assets |  | $ | 5,189.5 |  |  | $ | 5,016.0 |
Current liabilities |  | $ | 562.1 |  |  | $ | 640.0 |
Long-term debt |  | 2,213.0 |  |  | 2,014.0 |
Other noncurrent liabilities |  | 294.4 |  |  | 295.3 |
Shareholders' equity |  | 2,120.0 |  |  | 2,066.7 |
Total liabilities and shareholders' equity |  | $ | 5,189.5 |  |  | $ | 5,016.0 |

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SX 210.3A-04) -URI http://asc.fasb.org/extlink&oid=116822174&loc=d3e355119-122828 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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