10. RELATED PARTY TRANSACTIONS AND RELATIONSHIPS

In the normal course of business, Westar Energy, KCP&L and GMO engage in related party transactions with one another. A summary of these transactions and the amounts associated with them is provided below. Transactions between Westar Energy and either KCP&L or GMO for the three months ended March 31, 2018 are not reflected below as they occurred prior to the merger.

Jointly-Owned Plants and Shared Services

KCP&L employees manage GMO's business and operate its facilities at cost, including GMO's 18% ownership interest in KCP&L's Iatan Nos. 1 and 2. The operating expenses and capital costs billed from KCP&L to GMO were $42.0 million and $46.4 million for the three months ended March 31, 2019 and 2018, respectively.

Westar Energy employees manage Jeffrey Energy Center and operate its facilities at cost, including GMO's 8% ownership interest in Jeffrey Energy Center. The operating expenses and capital costs billed from Westar Energy to GMO for Jeffrey Energy Center and other various business activities were $6.3 million for the three months ended March 31, 2019.

KCP&L employees manage La Cygne Station and operate its facilities at cost, including Westar Energy's 50% ownership interest in La Cygne Station. KCP&L and Westar Energy employees also provide one another with shared service support, including costs related to human resources, information technology, accounting and legal services. The operating expenses and capital costs billed from KCP&L to Westar Energy were $31.5 million for the three months ended March 31, 2019. The operating and capital costs billed from Westar Energy to KCP&L were $7.4 million for the three months ended March 31, 2019.

Money Pool

KCP&L and GMO are also authorized to participate in the Evergy, Inc. money pool, an internal financing arrangement in which funds may be lent on a short-term basis to KCP&L and GMO from Evergy, Inc. and between KCP&L and GMO. At March 31, 2019 and December 31, 2018, KCP&L had no outstanding receivables or payables under the money pool.

Related Party Net Receivables and Payables

The following table summarizes Westar Energy's and KCP&L's related party net receivables and payables.



	March 31			December 31
	2019			2018
Westar Energy	(millions)
Net receivable from GMO	$	2.5		$	2.6
Net payable to KCP&L	(8.3		)	(13.5		)
Net payable to Evergy	(0.5		)	(1.4		)

KCP&L
Net receivable from GMO	$	53.6		$	72.6
Net receivable from Westar Energy	8.3			13.5
Net receivable from Evergy	19.3			15.7

Tax Allocation Agreement

Evergy files a consolidated federal income tax return as well as unitary and combined income tax returns in several state jurisdictions with Kansas and Missouri being the most significant. Income taxes for consolidated or combined subsidiaries are allocated to the subsidiaries based on separate company computations of income or loss. As of March 31, 2019 and December 31, 2018, Westar Energy had income taxes receivable from Evergy of $32.0 million and $42.7 million, respectively. As of March 31, 2019 and December 31, 2018, KCP&L had income taxes payable to Evergy of $10.6 million and $2.0 million, respectively.

Leases

KCP&L leases certain transmission equipment from Westar Energy. This lease was entered into prior to the merger in an arms-length transaction and is accounted for as an operating lease. As of March 31, 2019, KCP&L had a right-of-use asset of $30.0 million recorded within other long-term assets, $0.6 million of lease liability recorded in other current liabilities and $29.4 million of lease liability recorded in other long-term liabilities on its consolidated balance sheet related to this lease.