Leases (Notes)

12 Months Ended

Dec. 31, 2020

LeasesOur leases principally relate to office, maintenance, and transportation equipment and funeral service real estate. The majority of our lease arrangements contain options to (i) purchase the property at fair value on the exercise date, (ii) purchase the property for a value determined at the inception of the lease, or (iii) renew the lease for the fair rental value at the end of the primary lease term.

Future lease payments for non-cancelable operating and finance leases as of December 31, 2020 were as follows:


	Operating		Finance		Total
	(In thousands)

2021	$	10,836	$	51,126	$	61,962
2022	9,649		32,018		41,667
2023	7,222		24,504		31,726
2024	6,122		28,242		34,364
2025	5,177		9,711		14,888
2026 and thereafter	37,502		19,082		56,584
Total lease payments	$	76,508	$	164,683	$	241,191
Less: Interest	(19,268)		(15,819)		(35,087)
Present value of lease liabilities	$	57,240	$	148,864	$	206,104

The components of lease cost were as follows:




	Years Ended December 31,
	2020		2019
	(In thousands)
Amortization of leased assets	$	41,938	$	42,147
Interest on lease liabilities	5,955		6,882
Total finance lease cost	47,893		49,029
Operating lease cost	12,196		12,502
Variable lease cost	29		1,089
Total lease cost	$	60,118	$	62,620

Supplemental balance sheet information related to leases were as follows:


Lease Type	Balance Sheet Classification	December 31, 2020		December 31, 2019
		(In thousands)
Operating lease right-of-use assets (1)	Deferred charges and other assets	$	54,764	$	58,101
Finance lease right-of-use assets (1)	Property and equipment, net	146,144		179,538
Total right-of-use assets (1)		$	200,908	$	237,639


Operating	Accounts payable and accrued liabilities	$	8,584	$	8,538
Finance	Current maturities of long-term debt	47,109		39,428
Total current lease liabilities		55,693		47,966

Operating	Other liabilities	48,656		52,091
Finance	Long-term debt	101,755		145,824
Total non-current lease liabilities		150,411		197,915
Total lease liabilities		$	206,104	$	245,881

(1) Right-of-use assets are presented net of accumulated amortization.

The weighted-average life remaining and discount rates of our leases were as follows:


	December 31, 2020		December 31, 2019
	Operating	Finance	Operating	Finance
Weighted-average remaining lease term (years)	12.2	4.8	12.4	4.9
Weighted-average discount rate	4.3%	3.3%	4.6%	3.5%

Supplemental cash flow information related to leases were as follows:




	December 31, 2020		December 31, 2019
	(In thousands)
Cash paid for amounts in the measurement of lease liabilities:
Operating cash flows for operating leases	$	12,190	$	12,568
Operating cash flows for finance leases	5,446		7,472
Financing cash flows for finance leases	43,598		42,627
Total cash paid for amounts included in the measurement of lease liabilities	$	61,234	$	62,667

New finance leases	23,523		43,823
Finance lease renewals and extensions	—		4,410
Right-of-use assets obtained in exchange for finance lease liabilities	$	23,523	$	48,233

New operating leases	4,684		2,883
Operating lease renewals and extensions	4,128		8,042
Right-of-use assets obtained in exchange for operating lease liabilities	$	8,812	$	10,925

The right-of-use assets obtained in exchange for lease liabilities shown above exclude the following activities: In 2020, we acquired funeral home buildings and land that were previously leased. Right-of-use assets were reduced $2.7 million as a result of these acquisitions. In 2019, we recorded modifications of $5.7 million that reduced right-of-use assets and lease liabilities through remeasurement and reassessment of certain leases.

We have 64 operating leases where we are the lessor and the non-cancelable term is greater than one year, resulting in $3.6 million and $2.5 million in lease income for the years ended December 31, 2020 and 2019, respectively. We determine whether an arrangement is or contains a lease at the inception of the arrangement based on the terms of the arrangement. We lease retail space, office space and land, and we are party to cellular agreements and land easements. The underlying assets of these lease agreements are buildings and land. We generally do not have sales-type leases, direct financing leases, or lease receivables. Certain of our agreements include variable rental income based on a percentage of sales over base contractual levels. Renewal options that can be cancelled by the lessees are not included in our disclosure of future lease income, which includes only the non-cancelable terms and fixed escalation provisions. Certain lease arrangements contain options to purchase the property at fair value at the conclusion of the lease term. Non lease components are excluded from rental income disclosures.

Future undiscounted lease income from operating leases as of December 31, 2020 were as follows (in thousands):


2021	$	4,466
2022	4,053
2023	3,345
2024	2,929
2025	2,631
2026 and thereafter	21,956
Total expected cash receipts	$	39,380

We own certain land, buildings, and improvements for the sole purpose of generating lease income. Property is recorded at cost, and depreciation is recognized ratably over the estimated useful lives of the various classes of assets. Buildings and improvements are depreciated over a period ranging from ten years to forty years. For these properties, we recorded depreciation expense of $0.5 million, $0.2 million, and $0.2 million for the years ended December 31, 2020, 2019, and 2018, respectively. As of December 31, 2020, our Consolidated Balance Sheet includes Land of $25.0 million, and Buildings and improvements of $25.3 million, net of $2.2 million accumulated depreciation, related to these properties.