Amtrak 2013 Annual Report Download - page 103

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National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
1411-1359280 64
13. Postretirement Employee Benefits (continued)
Weighted-average assumptions used to determine net periodic benefit cost for the years ended
September 30, 2013 and 2012 are as follows:
Pension Benefits Other Benefits
2013 2012 2013 2012
Discount rate 4.35% 4.45% 4.35% 4.45%
Expected long term return on assets 7.50% 7.50% N/A N/A
Rate of compensation increase 4.20% 4.20% N/A N/A
Assumed health care cost trend rates are as follows:
September 30
2013 2012
Healthcare cost trend rate assumed for next year 7.75% – 8.75% 8.00% – 9.00%
Rate to which the cost trend rate is assumed to decline
(the ultimate trend rate) 5.00% 5.00%
Year that the rate reaches the ultimate trend rate 2029 2028
Assumed health care cost trend rates have a significant effect on the amounts reported for the
other defined benefit post retirement plans. A one-percentage-point change in assumed
healthcare cost trend rates would have the following effects on the Other Benefits plans
(in thousands):
1%
Increase
1%
Decrease
Effect on total of service and interest cost component $ 24,919 $ (19,662)
Effect on postretirement benefit obligation 205,221 (153,060)