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Note 11 - Pension Plan and Other Postretirement Benefits
 9 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Retirement Benefits [Text Block]

11. Pension Plan and Other Postretirement Benefits

 

Pension Plan—Components of net periodic pension benefit cost of the Company's noncontributory funded pension plan are as follows:

 

  

Three Months Ended

September 30,

  

Nine Months Ended

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Service Cost—Benefit Earned During the Period

 $1,655  $1,373  $4,966  $4,119 

Interest Cost on Projected Benefit Obligation

  3,264   3,603   9,790   10,809 

Expected Return on Assets

  (5,506)  (5,324)  (16,516)  (15,973)

Amortization of Prior-Service Cost:

                

From Regulatory Asset

  -   1   -   4 

From Other Comprehensive Income1

  -   2   -   6 

Amortization of Net Actuarial Loss:

                

From Regulatory Asset

  2,231   1,163   6,693   3,488 

From Other Comprehensive Income1

  55   26   165   79 

Net Periodic Pension Cost2

 $1,699  $844  $5,098  $2,532 

1Corporate cost included in nonservice cost components of postretirement benefits.

                

2Allocation of costs:

                

Service costs included in OTP capital expenditures

 $516  $333  $1,371  $1,059 

Service costs included in electric operation and maintenance expenses

  1,099   1,007   3,476   2,961 

Service costs included in other nonelectric expenses

  40   33   119   99 

Nonservice costs capitalized as regulatory assets

  13   (128)  36   (408)

Nonservice costs included in nonservice cost components of postretirement benefits

  31   (401)  96   (1,179)

 

Cash flows—The Company had no minimum funding requirement as of December 31, 2019 but made a discretionary plan contribution of $11.2 million in January 2020.

 

Executive Survivor and Supplemental Retirement Plan—Components of net periodic pension benefit cost of the Company’s unfunded, nonqualified benefit plan for executive officers and certain key management employees are as follows:

 

  

Three Months Ended

September 30,

  

Nine Months Ended

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Service Cost—Benefit Earned During the Period

 $45  $104  $134  $313 

Interest Cost on Projected Benefit Obligation

  362   433   1,086   1,301 

Amortization of Prior Service Cost:

                

From Regulatory Asset

  -   2   -   4 

From Other Comprehensive Income1

  -   4   -   12 

Amortization of Net Actuarial Loss:

                

From Regulatory Asset

  24   31   71   93 

From Other Comprehensive Income1

  85   87   256   262 

Net Periodic Pension Cost2

 $516  $661  $1,547  $1,985 

1Amortization of prior service costs and net actuarial losses from other comprehensive income are included in nonservice cost components of postretirement benefits.

                

2Allocation of Costs:

                

Service costs included in electric operation and maintenance expenses

 $-  $26  $-  $78 

Service costs included in other nonelectric expenses

  45   78   134   235 

Nonservice costs included in nonservice cost components of postretirement benefits

  471   557   1,413   1,672 

 

Other Postretirement Benefits—Components of net periodic postretirement benefit cost for health insurance benefits for retired OTP and corporate employees, net of the effect of Medicare Part D Subsidy:

 

  

Three Months Ended

September 30,

  

Nine Months Ended

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Service Cost—Benefit Earned During the Period

 $461  $321  $1,385  $964 

Interest Cost on Projected Benefit Obligation

  598   770   1,795   2,312 

Amortization of Prior-Service Cost:

                

From Regulatory Asset

  (1,169)  -   (3,508)  - 

From Other Comprehensive Income1

  (28)  -   (86)  - 

Amortization of Net Actuarial Loss:

                

From Regulatory Asset

  1,051   393   3,154   1,178 

From Other Comprehensive Income1

  26   10   78   29 

Net Periodic Postretirement Benefit Cost2

 $939  $1,494  $2,818  $4,483 

Effect of Medicare Part D Subsidy

 $281  $(45) $842  $(134)

1Corporate cost included in nonservice cost components of postretirement benefits.

                

2Allocation of Costs:

                

Service costs included in OTP capital expenditures

 $144  $78  $382  $248 

Service costs included in electric operation and maintenance expenses

  306   235   970   693 

Service costs included in other nonelectric expenses

  11   8   33   23 

Nonservice costs capitalized as regulatory assets

  150   284   396   905 

Nonservice costs included in nonservice cost components of postretirement benefits

  328   889   1,037   2,614