HollyFrontier 2014 Annual Report Download - page 93

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Table of Contents HOLLYFRONTIER CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Continued
85
Net periodic post-retirement expense consisted of the following components:
Years Ended December 31,
2014 2013 2012
(In thousands)
Service cost – benefit earned during the year $ 895 $ 1,112 $ 1,892
Interest cost on projected benefit obligations 638 665 3,519
Amortization of prior service credit (4,296)(5,896)(2,221)
Amortization of net loss — 130 269
Loss on settlement — 1,726 —
Net periodic post-retirement expense (credit) $ (2,763) $ (2,263) $ 3,459
Prior service credits are amortized over the average remaining effective period to obtain full benefit eligibility for participants.
Assumed health care cost trend rates have an effect on the amounts reported for the post-retirement health care benefit plans. The
weighted average assumptions used to determine net periodic benefit expense follow:
Years Ended December 31,
2014 2013 2012
Discount rate 4.25% 3.45% 4.60%
Current health care trend rate 8.00% 8.10% 8.40%
Ultimate health care trend rate 5.00% 5.00% 5.00%
Year rate reaches ultimate trend rate 2045 2023 2023
The effect of a 1% change in health care cost trend rates is as follows:
1% Point
Increase 1% Point
Decrease
(In thousands)
Service cost $ 191 $ (150)
Interest cost $ 58 $ (47)
Year-end accumulated post-retirement benefit obligation $ 1,881 $ (1,607)
Pension Plan
In 2013, we terminated the HollyFrontier Corporation Pension Plan (the "Plan"), a non-contributory defined benefit retirement
plan that covered certain employees. In June 2013, we made contributions of $22.7 million to the Plan, which was sufficient for
the Plan to settle its obligations to all participants including the premium paid to the non-participating annuity provider. In 2013,
we recognized a pre-tax pension settlement charge of $39.5 million, of which $37.6 million was reclassified out of accumulated
other comprehensive income, representing the irrevocable portion of our obligation. Net periodic pension expense was $42.6
million and $6.6 million for the years ended December 31, 2013 and 2012, respectively.
The following table sets forth the changes in the benefit obligation and plan assets of our retirement plan for the year ended
December 31, 2013: