Annual report pursuant to Section 13 and 15(d)

Pension and Other Postretirement Benefit Programs (Tables)

v3.7.0.1
Pension and Other Postretirement Benefit Programs (Tables)
12 Months Ended
Dec. 31, 2016
Compensation and Retirement Disclosure [Abstract]  
Changes in Projected Benefit Obligations
The following tables summarize the balance sheet impact of the pension benefit plans, as well as the related benefit obligations, assets, funded status and rate assumptions. The pension benefits disclosures include both the qualified, funded Retirement Income Plan (“RIP”) and the Retirement Benefit Equity Plan, which is a nonqualified, unfunded plan designed to provide pension benefits in excess of the limits defined under Sections 415 and 401(a)(17) of the Internal Revenue Code. The disclosures also include our two Canadian pension plans.
 
U.S.
 
Canadian
Defined-benefit pension plans
 
 
 
Change in benefit obligation:
 
 
 
Projected benefit obligations as of January 1, 2016
$

 
$

Liabilities assumed from separation
365.2

 
20.2

Service cost
4.3

 

Interest cost
11.7

 
0.5

Foreign currency translation adjustment

 
(0.8
)
Actuarial (gain)
(6.2
)
 
(0.5
)
Benefits paid
(10.6
)
 
(2.7
)
Projected benefit obligations as of December 31, 2016
364.4

 
16.7

 
 
 
 
Change in plan assets:
 
 
 
Fair value of plan assets as of January 1, 2016

 

Assets received from separation
362.2

 
19.2

Actual return on plan assets
11.6

 
0.8

Foreign currency translation adjustment

 
(0.8
)
Benefits paid
(10.6
)
 
(2.7
)
Fair value of plan assets as of December 31, 2016
363.2

 
16.5

Funded status of the plans
$
(1.2
)
 
$
(0.2
)
 
2016
 
2015
U.S. defined-benefit retiree health and life insurance plans
 
 
 
Change in benefit obligation:
 
 
 
Projected benefit obligations as January 1,
$
3.5

 
$
3.1

Liabilities assumed from separation
82.9

 

Service cost
0.1

 

Interest cost
2.7

 
0.1

Plan participants' contributions
1.6

 

Actuarial loss
1.1

 
0.3

Benefits paid, gross
(8.3
)
 

Projected benefit obligation as of December 31,
83.6

 
3.5

 
 
 
 
Change in plan assets:
 
 
 
Fair value of plan assets as January 1,

 

Employer contribution
6.7

 

Plan participants' contribution
1.6

 

Benefits paid
(8.3
)
 

Fair value of plan assets as of December 31,

 

Funded status of the plans
$
(83.6
)
 
$
(3.5
)
Schedule of Assumptions Used
 
U.S.
 
Canadian
Defined-benefit pension plans
 
 
 
Weighted average assumptions used to determine benefit obligations as of December 31, 2016:
 
 
 
Discount rate
4.30
%
 
3.80
%
Rate of compensation increase
3.10
%
 

Weighted average assumptions used to determine net periodic benefit cost for 2016:
 
 
 
Discount rate
4.40
%
 
3.50
%
Expected return on plan assets
6.75
%
 
5.40
%
Rate of compensation increase
3.10
%
 

 
2016
 
2015
U.S. defined-benefit retiree health and life insurance plans
 
 
 
Weighted average discount rate used to determine benefit obligations as of December 31,
4.05
%
 
4.25
%
Weighted average discount rate used to determine net periodic benefit cost
4.25
%
 
3.90
%
Schedule of Accumulated Benefit Obligations in Excess of Assets
 
U.S.
 
Canadian
Defined-benefit pension plans with benefit obligations in excess of assets
 
 
 
Projected benefit obligation, December 31, 2016
$
1.4

 
$
16.1

Accumulated benefit obligation, December 31, 2016
1.3

 
16.1

Fair value of plan assets, December 31, 2016

 
15.9

Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets
 
U.S.
 
Canadian
Defined-benefit pension plans with benefit obligations in excess of assets
 
 
 
Projected benefit obligation, December 31, 2016
$
1.4

 
$
16.1

Accumulated benefit obligation, December 31, 2016
1.3

 
16.1

Fair value of plan assets, December 31, 2016

 
15.9

Schedule of Net Periodic Pension Cost
The components of the pension cost are as follows:
 
Year Ended December 31,
 
2016
 
2015
 
2014
U.S. defined-benefit pension plans
 
 
 
 
 
Service cost of benefits earned during the period
$
4.3

 
$

 
$

Interest cost on projected benefit obligation
11.7

 

 

Expected return on plan assets
(17.4
)
 

 

Amortization of prior service cost
0.3

 

 

Recognized net actuarial loss
7.7

 

 

Allocated benefit cost from Shared Plans
2.2

 
14.8

 
2.6

Net periodic pension cost
$
8.8

 
$
14.8

 
$
2.6







NOTE 15. PENSION AND OTHER POSTRETIREMENT BENEFIT PROGRAMS (continued)
 
Year Ended December 31,
 
2016
 
2015
 
2014
Canadian defined-benefit pension plans
 
 
 
 
 
Interest cost on projected benefit obligation
$
0.5

 
$

 
$

Expected return on plan assets
(0.8
)
 

 

Amortization of net actuarial loss
0.2

 

 

Allocated benefit cost from Shared Plans
0.1

 
0.3

 

Net periodic pension cost
$

 
$
0.3

 
$

The components of postretirement benefits costs are as follows:
 
Year Ended December 31,
 
2016
 
2015
 
2014
U.S. defined-benefit retiree health and life insurance plans
 
 
 
 
 
Service cost of benefits earned during the period
$
0.1

 
$

 
$

Interest cost on accumulated postretirement benefit obligations
2.7

 
0.1

 
0.1

Amortization of prior service (credit)
(0.2
)
 

 

Amortization of net actuarial (gain)
(3.2
)
 

 

Allocated benefit cost (credit) from Shared Plans
(0.3
)
 
0.7

 
4.2

Net periodic postretirement benefit cost
$
(0.9
)
 
$
0.8

 
$
4.3

Schedule of Allocation of Plan Assets
Each asset class used has a defined asset allocation target and allowable range. The table below shows the asset allocation target and the December 31, 2016 position for each asset class:
 
Target Weight at
 
Position at
 
December 31, 2016
 
December 31, 2016
U.S. Asset Class
 
 
 
Fixed income securities
60
%
 
60
%
Equities
40
%
 
40
%


 
Target Weight at
 
Position at
 
December 31, 2016
 
December 31, 2016
Canadian Asset Class
 
 
 
Fixed income securities
50
%
 
49
%
Equities
48
%
 
48
%
Other
2
%
 
3
%
 
Value at December 31, 2016
 
Level 1
 
Level 2
 
Level 3
 
Total
U.S. Plans
 
 
 
 
 
 
 
Fixed income securities
$

 
$
219.1

 
$

 
$
219.1

Equities

 
144.1

 

 
144.1

Net assets measured at fair value
$

 
$
363.2

 
$

 
$
363.2



 
Value at December 31, 2016
 
Level 1
 
Level 2
 
Level 3
 
Total
Canadian Plans
 
 
 
 
 
 
 
Fixed income securities
$

 
$
8.1

 
$

 
$
8.1

Equities

 
7.9

 

 
7.9

Other
0.5

 

 

 
0.5

Net assets measured at fair value
$
0.5

 
$
16.0

 
$

 
$
16.5

Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates
A one-percentage-point change in assumed health care cost trend rates would have the following effects for 2017:
 
One percentage point
 
Increase
 
Decrease
U.S. defined-benefit retiree health and life insurance plans
 
 
 
Effect on total service and interest cost components
$

 
$

Effect on postretirement benefit obligation
(2.1
)
 
1.7

Schedule of Assets and (Liabilities) Recognized in Balance Sheet
Amounts recognized in assets and (liabilities) on the consolidated balance sheets at year end consist of:
 
U.S. Pension Benefits
 
Canadian Pension Benefits
 
2016
 
2016
Prepaid pension costs
$
0.1

 
$
0.1

Pension benefit liabilities
(1.3
)
 
(0.3
)
Net amount recognized
$
(1.2
)
 
$
(0.2
)

 
Retiree Health and Life Insurance Benefits
 
2016
 
2015
Accounts payable and accrued expenses
$
(8.1
)
 
$
(0.2
)
Postretirement benefit liabilities
(75.5
)
 
(3.3
)
Net amount recognized
$
(83.6
)
 
$
(3.5
)
Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss)
Pre-tax amounts recognized in accumulated other comprehensive (loss) income at year end consist of:
 
U.S. Pension Benefits
 
Canadian Pension Benefits
 
2016
 
2016
Net actuarial (loss)
$
(132.2
)
 
$
(2.9
)
Prior service (cost)
(0.5
)
 

Accumulated other comprehensive (loss)
$
(132.7
)
 
$
(2.9
)

 
Retiree Health and Life Insurance Benefits
 
2016
 
2015
Net actuarial gain (loss)
$
37.0

 
$
(0.6
)
Schedule of Expected Future Benefit Payments
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid over the next ten years for our U.S. plans:
 
U.S. Pension Benefits
 
Canadian Pension Benefits
 
Retiree Health and Life Insurance Benefits, Gross
 
Retiree Health Medicare Subsidy Receipts
2017
$
15.2

 
$
1.5

 
$
8.3

 
$
(0.1
)
2018
16.2

 
1.4

 
7.9

 
(0.1
)
2019
17.3

 
1.3

 
7.5

 
(0.1
)
2020
18.5

 
1.3

 
7.0

 
(0.1
)
2021
19.5

 
1.3

 
6.6

 
(0.1
)
2022-2026
110.3

 
5.8

 
27.9

 
(0.5
)