In accordance with SFAS No. 87, the Company has recorded an additional minimum pension liability for its underfunded plans representing the excess of unfunded accumulated benefit obligations over previously recorded pension liabilities. The cumulative additional liability totaled $1,130,000 and $1,076,000 at December 31, 2000 and 1999, respectively, and has been offset by intangible assets to the extent of previously unrecognized prior service costs. Amounts in excess of previously unrecognized prior service cost are recorded as reductions in shareholders’ equity.

Net pension expense and projected benefit obligations are calculated using assumptions of weighted average discount rates, future compensation levels, and expected long-term rates of return on assets. The weighted average discount rate used to measure the projected benefit obligation at December 31, 2000 and 1999 is 7.75 percent and 7.5 percent, respectively, the rate of increase in future compensation levels is 3.0 percent at December 31, 2000 and 1999, and the expected long-term rate of return on assets is 9.5 percent.

Other Postretirement Benefits
The Company provides postretirement medical benefits at certain of its subsidiaries. The Company accounts for these postretirement medical benefits in accordance with SFAS No. 132.

Net periodic postretirement benefit cost for the years ended December 31, 2000, 1999 and 1998 included the following components (in thousands):

		2000	1999	1998
Service cost of benefits earned		$ 108	$ 107	$ 94
Interest cost on accumulated
	postretirement benefit
	obligation	389	306	291
Net periodic postretirement
	benefit cost	$ 497	$ 413	$ 385

			2000	1999
Change in benefit obligation:
	Projected benefit obligation at
		end of prior year	$ 4,656	$ 3,898
		Service cost	108	107
		Interest cost	389	306
		Actuarial loss	189	611
		Acquisition	575	–
		Special termination benefits	–	284
		Benefits paid	(683)	(550)
	Projected benefit obligation at
		end of year	$ 5,234	$ 4,656
Funded status			$ (5,234)	$ (4,656)
Unrecognized net loss			966	830
Net amount recognized			$ (4,268)	$ (3,826)

The accumulated postretirement benefit obligations at December 31, 2000 and 1999 were determined using a weighted average discount rate of 7.5 percent. The rate of increase in the costs of covered health care benefits is assumed to be 6.0 percent in 2001, gradually decreasing to 5.0 percent by the year 2002. Increasing the assumed health care costs trend rate by one percentage point would increase the accumulated postretirement benefit obligation as of December 31, 2000 by approximately $970,000 and would increase net periodic postretirement benefit cost by approximately $86,000 for the year ended December 31, 2000.

9. Income Taxes

The Company accounts for income taxes in accordance with SFAS No. 109, “Accounting for Income Taxes,” which requires the use of the liability method of accounting for deferred income taxes.

The provision for income taxes for the years ended December 31, 2000, 1999 and 1998 consisted of the
following (in thousands):

		2000	1999	1998
Current:
	Federal	$ 2,650	$ 11,063	$ 19,444
	State	3,056	3,081	2,950
		5,706	14,144	22,394
Deferred		(239)	9,072	8,076
		$ 5,467	$ 23,216	$ 30,470

		2000	1999	1998
Federal statutory tax rate		35.0%	35.0%	35.0%
State taxes, net of federal
	tax benefit	2.4	2.7	2.7
Other		2.3	(1.6)	(0.7)
Effective tax rate		39.7%	36.1%	37.0%

			2000	1999
Deferred income tax assets:
	Deferred employee benefits		$ 1,258	$ 1,258
	Postretirement benefits
		other than pension	879	1,084
	Accounts receivable		602	602
	Insurance		2,121	2,121
	Tax loss carry forwards and credits		15,484	4,936
	Inventories		2,010	1,636
	Other		3,006	3,006
		Total deferred income tax assets	25,360	14,643
Deferred income tax liabilities:
	Depreciation and amortization		(63,866)	(54,439)
	Asset revaluation		(3,846)	(3,846)
	Postemployment benefits		(2,190)	(1,441)
	Losses on contractual sales
		commitments	(1,578)	(428)
	Other		(9)	(9)
		Total deferred income tax liabilities	(71,489)	(60,163)
Valuation allowance			(4,308)	(3,633)
			$ (50,437)	$ (49,153)

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