PARTNERS' EQUITY

Please refer to Note 2 for a discussion of the merger of a subsidiary of ours with and into NuStar GP Holdings, pursuant to which we will become the sole member of NuStar GP Holdings.

Partners’ Equity Activity

The following table summarizes changes to our partners’ equity (in thousands of dollars):



Balance as of January 1, 2018	$	2,480,089
Net income	126,133
Unit-based compensation	1,286
Other comprehensive income	20,924
Distributions to partners	(131,262		)
Other	(5,113		)
Balance as of March 31, 2018	$	2,492,057

Cash Distributions

General Partner and Common Limited Partners. We make quarterly distributions to common unitholders and the general partner of 100% of our available cash, generally defined as cash receipts less cash disbursements, including distributions to the 8.50% Series A, 7.625% Series B and 9.00% Series C Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the Preferred Units), and cash reserves established by the general partner, in its sole discretion. These quarterly distributions are declared and paid within 45 days subsequent to each quarter-end. The common unitholders receive a distribution each quarter as determined by the board of directors, subject to limitation by the distributions in arrears, if any, on the Preferred Units. Our available cash is distributed based on the percentages shown below:



	Percentage of Distribution
Quarterly Distribution Amount per Common Unit	Common Unitholders	General Partner Including Incentive Distributions
Up to $0.60	98%	2%
Above $0.60 up to $0.66	90%	10%
Above $0.66	75%	25%

On April 26, 2018, we announced that the board of directors of NuStar GP, LLC reset our quarterly distribution per common unit to $0.60 ($2.40 on an annualized basis), starting with the first-quarter distribution payable on May 14, 2018.

The following table reflects the allocation of total cash distributions to the general partner and common limited partners applicable to the period in which the distributions were earned:



	Three Months Ended March 31,
	2018		2017
	(Thousands of Dollars, Except Per Unit Data)
General partner interest	$	1,141	$	2,343
General partner incentive distribution	—		12,912
Total general partner distribution	1,141		15,255
Common limited partners’ distribution	55,916		101,913
Total cash distributions	$	57,057	$	117,168

Cash distributions per unit applicable to common limited partners	$	0.60	$	1.095

The following table summarizes information about our quarterly cash distributions to our general partner and common limited partners:



Quarter Ended	Cash Distributions Per Unit		Total Cash Distributions		Record Date	Payment Date
			(Thousands of Dollars)
March 31, 2018	$	0.600	$	57,057	May 8, 2018	May 14, 2018
December 31, 2017	$	1.095	$	115,267	February 8, 2018	February 13, 2018

Preferred Units. The following table summarizes information about our quarterly cash distributions on our Preferred Units:



Period	Cash Distributions Per Unit		Total Cash Distributions		Record Date	Payment Date
			(Thousands of Dollars)
Series A Preferred Units:
March 15, 2018 - June 14, 2018	$	0.53125	$	4,813	June 1, 2018	June 15, 2018
December 15, 2017 - March 14, 2018	$	0.53125	$	4,813	March 1, 2018	March 15, 2018

Series B Preferred Units:
March 15, 2018 to June 14, 2018	$	0.47657	$	7,339	June 1, 2018	June 15, 2018
December 15, 2017 to March 14, 2018	$	0.47657	$	7,339	March 1, 2018	March 15, 2018

Series C Preferred Units:
March 15, 2018 to June 14, 2018	$	0.56250	$	3,881	June 1, 2018	June 15, 2018
November 30, 2017 - March 14, 2018	$	0.65625	$	4,528	March 1, 2018	March 15, 2018

Allocations of Net Income

Our partnership agreement sets forth the calculation to be used to determine the amount and priority of cash distributions that the unitholders and general partner will receive. The partnership agreement also contains provisions for the allocation of net income to the unitholders and the general partner. Our net income for each quarterly reporting period is first allocated to the preferred limited partner unitholders in an amount equal to the earned distributions for the respective reporting period and then to the general partner in an amount equal to the general partner’s incentive distribution calculated based upon the declared distribution for the respective reporting period. We allocate the remaining net income or loss among the common unitholders (98%) and general partner (2%), as set forth in our partnership agreement. As a result of the distribution declared for the first quarter of 2018 of $0.60 per common unit (discussed above), the general partner did not receive an incentive distribution.

The following table details the calculation of net income applicable to the general partner:



	Three Months Ended March 31,
	2018			2017
	(Thousands of Dollars, Except Percentage Data)
Net income attributable to NuStar Energy L.P.	$	126,133		$	57,940
Less preferred limited partner interest	15,990			4,813
Less general partner incentive distribution	—			12,912
Net income after preferred limited partner interest and general partner incentive distribution	110,143			40,215
General partner interest allocation	2		%	2		%
General partner interest allocation of net income	2,203			804
General partner incentive distribution	—			12,912
Net income applicable to general partner	$	2,203		$	13,716

Accumulated Other Comprehensive Income (Loss)

The balance of and changes in the components included in AOCI were as follows:



	Foreign Currency Translation			Cash Flow Hedges			Pension and Other Postretirement Benefits			Total
	(Thousands of Dollars)
Balance as of January 1, 2018	$	(51,603	)	$	(24,304	)	$	(9,020	)	$	(84,927	)
Other comprehensive income (loss):
Other comprehensive income before reclassification adjustments	2,312			17,421			—			19,733
Net gain on pension costs reclassified into other income, net	—			—			(203		)	(203		)
Net loss on cash flow hedges reclassified into interest expense, net	—			1,390			—			1,390
Other	60			—			(56		)	4
Other comprehensive income (loss)	2,372			18,811			(259		)	20,924
Balance as of March 31, 2018	$	(49,231	)	$	(5,493	)	$	(9,279	)	$	(64,003	)