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Benefit Plans | 12 Months Ended
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Dec. 31, 2019
Retirement Benefits [Abstract] |
Benefit Plans | Benefit Plans Defined Contribution Plans We maintain defined contribution plans for our employees. All eligible employees, other than our U.S. Oil employees, may participate in our Par plan after thirty days of service. All eligible employees at U.S. Oil & Refining Co. may participate in our U.S. Oil plan following the later of date of hire or age twenty-one. For all employees participating in the Par plan and non-union employees participating in the U.S. Oil plan, we match employee contributions up to a maximum of 6% of the employee’s eligible compensation, with the employer contributions vesting at 100%. For the years ended December 31, 2019, 2018, and 2017, we made contributions to the plans totaling approximately $5.6 million, $4.0 million, and $3.6 million, respectively. Defined Benefit Plans We maintain defined benefit pension plans (the “Benefit Plans”) covering substantially all our Wyoming Refining employees and the employees of U.S. Oil covered by a collective bargaining agreement. Benefits under our Wyoming Refining plan are based on years of service and the employee’s highest average compensation received during five consecutive years of the last ten years of employment. Benefits under our U.S. Oil plan are based on the employee’s hourly rate of compensation at the beginning of each year of employment. Our funding policy is to contribute annually an amount equal to the pension expense, subject to the minimum funding requirements of the Employee Retirement Income Security Act of 1974 and the tax deductibility of such contributions. In December 2016, the Wyoming Refining Plan was amended (the “Plan Amendment”) to freeze all future benefit accruals for salaried plan participants. The changes in the projected benefit obligation and the fair value of plan assets of our Benefit Plans for the years ended December 31, 2019 and 2018 were as follows (in thousands):
| 2019 |  | 2018
Changes in projected benefit obligation: |  |  |
Projected benefit obligation as of the beginning of the period | $ | 27,539 |  |  | $ | 30,877 |
Acquired | 16,831 |  |  | — |
Service cost | 910 |  |  | 548 |
Interest cost | 1,794 |  |  | 1,107 |
Actuarial (gain) loss | 6,688 |  |  | (2,917 | )
Benefits paid | (1,620 | ) |  | (2,076 | )
Projected benefit obligation as of the end of the period | $ | 52,142 |  |  | $ | 27,539 |
Changes in fair value of plan assets: |  |  |
Fair value of plan assets as of the beginning of the period | $ | 20,254 |  |  | $ | 23,461 |
Acquired | 16,027 |  |  | — |
Actual return (loss) on plan assets | 6,405 |  |  | (1,131 | )
Employer contributions | 1,800 |  |  | — |
Benefits paid | (1,620 | ) |  | (2,076 | )
Fair value of plan assets as of the end of the period | $ | 42,866 |  |  | $ | 20,254 |
The underfunded status of our Benefit Plans is recorded within Other liabilities in our consolidated balance sheets. The reconciliation of the underfunded status of our Benefit Plans of December 31, 2019 and 2018 was as follows:
| 2019 |  | 2018
Projected benefit obligation | $ | 52,142 |  |  | $ | 27,539 |
Fair value of plan assets | 42,866 |  |  | 20,254 |
Underfunded status | $ | 9,276 |  |  | $ | 7,285 |
Gross amounts recognized in accumulated other comprehensive income: (1) |  |  |
Net actuarial gain (loss) | $ | (2,622 | ) |  | $ | 3,494 |
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(1) | As of December 31, 2019, we had an immaterial amount of service costs recognized in accumulated other comprehensive income. As of December 31, 2019, we had $0.2 million in accumulated other comprehensive income that is expected to be amortized into net periodic benefit cost in 2020.
Weighted-average assumptions used to measure our projected benefit obligation as of December 31, 2019, 2018, and 2017 and net periodic benefit costs for the years ended December 31, 2019, 2018 and 2017 are as follows:
| 2019 |  | 2018 |  | 2017
Projected benefit obligation: |  |  |  |  |
Wyoming Refining plan |  |  |  |  |
Discount rate (1) | 3.30 | % |  | 4.20 | % |  | 3.65 | %
Rate of compensation increase | 3.00 | % |  | 3.00 | % |  | 3.00 | %
U.S. Oil plan |  |  |  |  |
Discount rate (1) | 3.10 | % |  | — | % |  | — | %
Rate of compensation increase | 3.00 | % |  | — | % |  | — | %
Net periodic benefit costs: |  |  |  |  |
Wyoming Refining plan |  |  |  |  |
Discount rate (1) | 4.20 | % |  | 3.65 | % |  | 4.20 | %
Expected long-term rate of return (2) | 6.50 | % |  | 6.50 | % |  | 6.25 | %
Rate of compensation increase | 3.00 | % |  | 3.00 | % |  | 4.30 | %
U.S. Oil plan |  |  |  |  |
Discount rate (1) | 4.10 | % |  | — | % |  | — | %
Expected long-term rate of return (2) | 6.00 | % |  | — | % |  | — | %
Rate of compensation increase | 3.00 | % |  | — | % |  | — | %
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(1) | In determining the discount rate, we use yields on high-quality fixed income investments with payments matched to the estimated distributions of benefits from our plans.
(2) | The expected long-term rate of return is based on a blend of historic returns of equity and debt securities.
The net periodic benefit cost for the years ended December 31, 2019, 2018, and 2017 includes the following components:
| 2019 |  | 2018 |  | 2017
Components of net periodic benefit cost: |  |  |  |  |
Service cost | $ | 910 |  |  | $ | 548 |  |  | $ | 614 |
Interest cost | 1,794 |  |  | 1,107 |  |  | 1,192 |
Expected return on plan assets | (1,972 | ) |  | (1,258 | ) |  | (1,189 | )
Amortization of net loss | 95 |  |  | — |  |  | — |
Amortization of prior service cost | 3 |  |  | — |  |  | — |
Net periodic benefit cost | $ | 830 |  |  | $ | 397 |  |  | $ | 617 |
The Service cost component of net periodic benefit cost is included in Operating expense (excluding depreciation) in our consolidated statement of operations for the years ended December 31, 2019, 2018, and 2017. The other components of net periodic benefit cost are included in Other income (expense), net in our consolidated statement of operations for the years ended December 31, 2019, 2018, and 2017. The weighted-average asset allocation for our Wyoming Refining plan at December 31, 2019 is as follows:
| Target |  | Actual
Asset category: |  |  |
Equity securities | 54 | % |  | 56 | %
Debt securities | 35 | % |  | 32 | %
Real estate | 11 | % |  | 12 | %
Total | 100 | % |  | 100 | %
The weighted-average asset allocation for our U.S. Oil plan at December 31, 2019 is as follows:
| Target Range |  | Actual
Asset category: |  |  |
Equity securities | 40 - 80% |  |  | 62 | %
Debt securities | 20 - 60% |  |  | 38 | %
Cash and Cash Equivalents | 0 - 30% |  |  | — | %
Total | 100 | % |  | 100 | %
We have a long-term, risk-controlled investment approach using diversified investment options with minimal exposure to volatile investment options like derivatives. Our Benefit Plans’ assets are invested in pooled separate accounts administered by the Benefit Plans’ custodians. The underlying assets in the pooled separate accounts are invested in equity securities, debt securities, real estate, or cash and cash equivalents. The pooled separate accounts are valued based upon the fair market value of the underlying investments and are deemed to be Level 2. We intend to contribute $0.5 million to the U.S. Oil plan during 2020. We do no t intend to make any contributions to the Wyoming Refining plan during 2020. Based on current data and assumptions, the following benefit payments, which reflect expected future service, as appropriate, are expected to be paid over the next 10 years:
Year Ended |  |
2020 |  | $ | 2,215 |
2021 |  | 2,007 |
2022 |  | 2,082 |
2023 |  | 2,203 |
2024 |  | 2,234 |
Thereafter |  | 13,095 |
|  | $ | 23,836 |

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