XML 82 R19.htm IDEA: XBRL DOCUMENT
v3.19.3

Lease Accounting (Notes) | 9 Months Ended
--- | ---
Sep. 30, 2019
Leases [Abstract] |
Lessee, Operating Leases [Text Block] | LEASE ACCOUNTING Lessee Accounting The Partnership leases terminal facilities, tank cars, office space, land and equipment under non-cancelable operating leases whose initial terms are typically five to 15 years, with some real estate leases having terms of 40 years or more, along with options that permit renewals for additional periods. At the inception of each, we determine if the arrangement is a lease or contains an embedded lease and review the facts and circumstances of the arrangement to classify lease assets as operating or finance leases under Topic 842. The Partnership has elected not to record any leases with terms of 12 months or less on the balance sheet. At present, the majority of the Partnership’s active leases are classified as operating in accordance with Topic 842. Balances related to operating leases are included in operating lease ROU assets, accrued and other current liabilities, operating lease current liabilities and non-current operating lease liabilities in our consolidated balance sheets. Finance leases represent a small portion of the active lease agreements and are included in finance lease ROU assets, current maturities of long-term debt and long-term debt, less current maturities in our consolidated balance sheets. The ROU assets represent the Partnership’s right to use an underlying asset for the lease term and lease liabilities represent the obligation of the Partnership to make minimum lease payments arising from the lease for the duration of the lease term. Most leases include one or more options to renew, with renewal terms that can extend the lease term from one to 20 years or greater. The exercise of lease renewal options is typically at the sole discretion of the Partnership, and lease extensions are evaluated on a lease-by-lease basis. Leases containing early termination clauses typically require the agreement of both parties to the lease. At the inception of a lease, all renewal options reasonably certain to be exercised are considered when determining the lease term. Presently, the Partnership does not have leases that include options to purchase or automatic transfer of ownership of the leased property to the Partnership. The depreciable life of lease assets and leasehold improvements are limited by the expected lease term. To determine the present value of future minimum lease payments, we use the implicit rate when readily determinable. Presently, because many of our leases do not provide an implicit rate, the Partnership applies its incremental borrowing rate based on the information available at the lease commencement date to determine the present value of minimum lease payments. The operating and finance lease ROU assets include any lease payments made and exclude lease incentives. Minimum rent payments are expensed on a straight-line basis over the term of the lease. In addition, some leases require additional contingent or variable lease payments, which are based on the factors specific to the individual agreement. Variable lease payments the Partnership is typically responsible for include payment of real estate taxes, maintenance expenses and insurance. For short-term leases (leases that have term of twelve months or less upon commencement), lease payments are recognized on a straight-line basis and no ROU assets are recorded. The components of operating and finance lease amounts recognized in the accompanying consolidated balance sheet as of September 30, 2019 were as follows:
| September 30, 2019
Operating leases: |
Lease right-of-use assets, net | $ | 850 |
Operating lease current liabilities | 57 |
Accrued and other current liabilities | 1 |
Non-current operating lease liabilities | 807 |
Finance leases: |
Property, plant and equipment, net | $ | 2 |
Lease right-of-use assets, net | 39 |
Accrued and other current liabilities | 1 |
Current maturities of long-term debt | 7 |
Long-term debt, less current maturities | 35 |
Other non-current liabilities | 2 |
The components of lease expense for the three and nine months ended September 30, 2019 were as follows:
|  | Income Statement Location |  | Three Months Ended September 30, 2019 |  | Nine Months Ended September 30, 2019
Operating lease costs: |  |  |  |
Operating lease cost |  | Cost of goods sold |  | $ | 7 |  |  | $ | 23 |
Operating lease cost |  | Operating expenses |  | 18 |  |  | 54 |
Operating lease cost |  | Selling, general and administrative |  | 3 |  |  | 10 |
Total operating lease costs |  | 28 |  |  | 87 |
Finance lease costs: |  |  |  |
Amortization of lease assets |  | Depreciation, depletion and amortization |  | 2 |  |  | 4 |
Interest on lease liabilities |  | Interest expense, net of capitalized interest |  | 1 |  |  | 1 |
Total finance lease costs |  | 3 |  |  | 5 |
Short-term lease cost |  | Operating expenses |  | 10 |  |  | 33 |
Variable lease cost |  | Operating expenses |  | 3 |  |  | 11 |
Lease costs, gross |  | 44 |  |  | 136 |
Less: Sublease income |  | Other revenue |  | 14 |  |  | 37 |
Lease costs, net |  | $ | 30 |  |  | $ | 99 |
The weighted average remaining lease terms and weighted average discount rates as of September 30, 2019 were as follows:
| September 30, 2019
Weighted-average remaining lease term (years): |
Operating leases | 22 |
Finance leases | 6 |
Weighted-average discount rate (%): |
Operating leases | 5 | %
Finance leases | 5 | %
Cash flows and non-cash activity related to leases for the nine months ended September 30, 2019 were as follows:
| Nine Months Ended September 30, 2019
Operating cash flows from operating leases | $ | (78 | )
Lease assets obtained in exchange for new finance lease liabilities | 37 |
Lease assets obtained in exchange for new operating lease liabilities | 36 |
Maturities of lease liabilities as of September 30, 2019 are as follows:
| Operating Leases |  | Finance Leases |  | Total
2019 (remainder) | $ | 27 |  |  | $ | 2 |  |  | $ | 29 |
2020 | 96 |  |  | 10 |  |  | 106 |
2021 | 87 |  |  | 10 |  |  | 97 |
2022 | 75 |  |  | 10 |  |  | 85 |
2023 | 70 |  |  | 9 |  |  | 79 |
Thereafter | 1,170 |  |  | 10 |  |  | 1,180 |
Total lease payments | 1,525 |  |  | 51 |  |  | 1,576 |
Less: present value discount | 660 |  |  | 6 |  |  | 666 |
Present value of lease liabilities | $ | 865 |  |  | $ | 45 |  |  | $ | 910 |
Lessor Accounting Sunoco LP leases or subleases a portion of its real estate portfolio to third-party companies as a stable source of long-term revenue. Sunoco LP’s lessor and sublease portfolio consists mainly of operating leases with convenience store operators. At this time, most lessor agreements contain five-year terms with renewal options to extend and early termination options based on established terms specific to the individual agreement. Rental income included in other revenue in our consolidated statement of operations for the three and nine months ended September 30, 2019 was $39 million and $111 million, respectively. Future minimum operating lease payments receivable as of September 30, 2019 are as follows:
| Lease Receivables
2019 (remainder) | $ | 25 |
2020 | 85 |
2021 | 69 |
2022 | 56 |
2023 | 4 |
Thereafter | 7 |
Total undiscounted cash flows | $ | 246 |

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration