Postretirement Benefit Plans

The Company provides certain health care and life insurance benefits for nine retired employees who have met certain eligibility requirements. All other employees retiring after reaching age 65 and having at least 15 years of service with the Company will be allowed to stay on the Company’s group life and health insurance policies, but will be required to pay premiums. The Company’s share of the estimated costs that will be paid after retirement is generally being accrued by charges to expense over the employees’ active service periods to the dates they are fully eligible for benefits, except that the Company’s unfunded cost that existed at January 1, 1993 is being accrued primarily in a straight-line manner that resulted in its full accrual by December 31, 2013.

Generally Accepted Accounting Principles (“GAAP”) requires the Company to recognize the funded status (i.e. the difference between the fair value of plan assets and the projected benefit obligations) of its postretirement benefit plans in the consolidated balance sheet, with a corresponding adjustment to accumulated other comprehensive income, net of taxes.

The following amounts that have not been recognized in the net periodic benefit cost of the postretirement benefit plan for the year ended December 31, 2014 but are included in other comprehensive income: unrecognized net actuarial gain of $38 thousand. The transition obligation included in other comprehensive income and expected to be recognized in the net periodic benefit cost of the postretirement benefit plan during 2015 is $2 thousand.

The following tables provide a reconciliation of the changes in the benefit obligations and fair value of assets for 2014, 2013, and 2012 and a statement of the funded status at December 31, 2014, 2013 and 2012 for the postretirement benefit plans of the Company. The Company uses a December 31st measurement date for its plans.



	Postretirement Benefits Plan
	2014			2013			2012
	(in thousands)
Change in Benefit Obligation:
Benefit obligation, beginning	$	138		$	150		$	150
Service cost	—			—			—
Interest cost	5			4			5
Actuarial loss (gain)	1			(9		)	2
Benefits paid	(7		)	(7		)	(7		)
Settlement loss	—			—			—
Benefit obligation, ending	$	137		$	138		$	150
Change in Plan Assets:
Fair value of plan assets, beginning	$	—		$	—		$	—
Actual return on plan assets	—			—			—
Employer contributions	7			7			7
Benefits paid	(7		)	(7		)	(7		)
Fair value of plan assets, ending	$	—		$	—		$	—

	Postretirement Benefits Plan
	2014			2013			2012
	(in thousands)
Funded Status:
Funded status	$	(137	)	$	(138	)	$	(150	)
Unrecognized net actuarial loss	—			—			—
Unrecognized net transition obligation	—			—			—
Unrecognized prior service cost	—			—			—
Accrued benefits	$	(137	)	$	(138	)	$	(150	)
Amounts Recognized in Consolidated Balance Sheets:
Prepaid benefit cost	$	—		$	—		$	—
Accrued liability	(137		)	(138		)	(150		)
	$	(137	)	$	(138	)	$	(150	)
Amounts Recognized in Accumulated Other Comprehensive Income:
Net actuarial loss (gain)	$	(57	)	$	(65	)	$	(65	)
Net transition obligation	—			—			—
Deferred tax (benefit)/liability	19			21			21
	$	(38	)	$	(44	)	$	(44	)

The following tables provide the components of net periodic benefit cost of the postretirement benefit plan for the years ended December 31, 2014, 2013, and 2012:



	Postretirement Benefits Plan
	2014			2013			2012
	(in thousands)
Components of Net Periodic Benefit Cost:
Service cost	$	—		$	—		$	—
Interest cost	5			4			5
Expected return on plan assets	—			—			—
Amortization of prior service costs	—			—			—
Amortization of transition obligation	—			—			—
Recognized net loss due to settlement	—			—			—
Amortization of net actuarial loss	(9		)	(7		)	(8		)
Net periodic benefit cost	$	(4	)	$	(3	)	$	(3	)

The benefit obligation for the postretirement benefit plan was calculated using a weighted average discount rate of 3.50% for 2014, 2.75% for 2013, and 3.50% for 2012. For measurement purposes, a 10.00% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2015 and 2016, 8.00% for 2017 and 2018, and 6.00% for 2019 and thereafter. If these rates were increased by 1.00% in each year, the benefit obligation at December 31, 2014 would have increased by $6 thousand and the net periodic benefit cost for 2014 would have increased by less than $1 thousand. If these rates were decreased by 1.00% in each year, the benefit obligation at December 31, 2014 would have decreased by $5 thousand and the net periodic benefit cost for 2014 would have decreased by less than $1 thousand.

Estimated future benefit payments at December 31, 2014, which reflect expected future service, as appropriate, were as follows:



	Postretirement Benefits
	(in thousands)
2015	$	13
2016	13
2017	13
2018	13
2019	13
2020 - 2024	54