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Leases | 12 Months Ended
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Dec. 31, 2023
Leases [Abstract] |
Leases | Leases At inception, the Company determines if an arrangement contains a lease and whether that lease meets the classification criteria of a finance or operating lease. Some of the Company’s lease arrangements contain lease components (e.g., minimum rent payments) and non-lease components (e.g., maintenance, labor charges, etc.). The Company generally accounts for each component separately based on the estimated standalone price of each component. For certain equipment leases, such as freight car, vehicles and work equipment, the Company accounts for the lease and non-lease components as a single lease component. Certain of the Company’s lease agreements include rental payments that are adjusted periodically for an index or rate. The leases are initially measured using the projected payments adjusted for the index or rate in effect at the commencement date. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. Operating Leases Operating leases are included in right-of-use lease assets, other current liabilities and long-term lease liabilities on the consolidated balance sheets. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the balance sheet. The Company has various lease agreements with other parties with terms up to 50 years, including a significant operating lease with the State of Georgia for approximately 137 miles of right-of-way with integral equipment for a term of 50 years with an annual 2.5% increase. Non-cancelable, long-term leases may include provisions for maintenance, options to purchase and options to extend the terms. These options are included in the lease term when it is reasonably certain that the option will be exercised. Lease expense for operating leases, including leases with escalations over their terms, is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense is included in equipment and other rents on the consolidated income statements and is reported net of lease income. Lease income was not material to the results of operations for 2023, 2022 or 2021. NOTE 7. Leases, continued The following table presents information about the amount, timing and uncertainty of cash flows arising from all of the Company’s operating leases as of December 31, 2023.
(Dollars in Millions) | December 2023
Maturity of Lease Liabilities | Lease Payments
2024 | $ | 70 |
2025 | 67 |
2026 | 51 |
2027 | 43 |
2028 | 35 |
Thereafter | 1,108 |
Total Undiscounted Operating Lease Payments | $ | 1,374 |
Less: Imputed Interest | (815) |
Present Value of Operating Lease Liabilities | $ | 559 |
(Dollars in Millions) | 2023 | 2022
Balance Sheet Classification |  |
Right of Use Asset | $ | 498 |  | $ | 505 |
Current Lease Liabilities (Included in Other Current Liabilities) | $ | 68 |  | $ | 69 |
Long-term Lease Liabilities | 491 |  | 488 |
Total Operating Lease Liabilities | $ | 559 |  | $ | 557 |
Other Information |  |
Weighted-average Remaining Lease Term for Operating Leases | 30 years | 31 years
Weighted-average Discount Rate for Operating Leases | 5.1 | % | 5.0 | %
Cash Flows As of December 2023 and 2022, the Company's right-of-use asset was valued at $498 million and $505 million, respectively. In 2023, right of use assets of $56 million were recognized as non-cash asset additions due to new operating lease liabilities. In 2022, right-of-use assets of $74 million were recognized as non-cash asset additions due to new operating lease liabilities. Cash paid for amounts included in the present value of operating lease liabilities was $78 million and $76 million during the years ended 2023 and 2022, respectively, and is included in operating cash flows. NOTE 7. Leases, continued Operating Lease Costs These costs are primarily related to long-term operating leases, but also include immaterial amounts for variable leases and short-term leases with terms greater than 30 days. These amounts are shown in the table below.
| Years Ended
(Dollars in Millions) | 2023 |  | 2022 |  | 2021
Rent Expense on Operating Leases | $ | 109 |  |  | $ | 109 |  |  | $ | 89 |
Finance Leases Finance leases are included in properties - net and long-term debt on the consolidated balance sheets and were not material as of December 2023 or December 2022. The associated amortization expense and interest expense are included in depreciation and interest expense, respectively, on the consolidated income statements and were not material to the results of operations for 2023, 2022 or 2021.

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//842-20/tableOfContent + Details
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