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COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Sep. 30, 2014
COMMITMENTS AND CONTINGENCIES |
COMMITMENTS AND CONTINGENCIES | 15.COMMITMENTS AND CONTINGENCIES Lease Commitments Barnwell has several non-cancelable operating leases for office space and leasehold land. Rental expense was $548,000 and $521,000 for the years ended September 30, 2014 and 2013, respectively. Barnwell is committed under these leases for minimum rental payments summarized by fiscal year as follows:
Fiscal year ending |  |  |
2015 |  | $ | 305,000 |
2016 |  | 299,000 |
2017 |  | 264,000 |
2018 |  | 154,000 |
2019 |  | 134,000 |
Thereafter through 2026 |  | 403,000 |
Total |  | $ | 1,559,000 |
The lease payments for leasehold land were subject to renegotiation as of January 1, 2006. Per the lease agreement, the lease payments will remain unchanged pending an appraisal, whereupon the lease rent could be adjusted to fair market value. Barnwell does not know the amount of the new lease payments which could be effective upon performance of the appraisal; they may remain unchanged or increase, and Barnwell currently expects the adjustment, if any, to not be material. The future rental payment disclosures above assume the minimum lease payments for leasehold land in effect at December 31, 2005 remain unchanged through December 2025, the end of the lease term. Environmental Matters As of September 30, 2014 and 2013, environmental remediation costs of $501,000 and $783,000, respectively, which have not been discounted, were accrued in “Accrued operating and other expenses” on the Consolidated Balance Sheets. The amounts accrued represent the estimated liability for probable environmental remediation costs for soil contamination from infrastructure issues at the Dunvegan and Wood River properties. Because of the inherent uncertainties associated with environmental assessment and remediation activities, future expenses to remediate the currently identified sites, and sites identified in the future, if any, could be incurred. Guarantee See Note 6 for a discussion of Barnwell’s guarantee of the Kukio Resort land development partnership’s performance bonds. Legal and Regulatory Matters Barnwell is routinely involved in disputes with third parties that occasionally require litigation. In addition, Barnwell is required to maintain compliance with all current governmental controls and regulations in the ordinary course of business. Barnwell’s management is not aware of any claims or litigation involving Barnwell that are likely to have a material adverse effect on its results of operations, financial position or liquidity. Other Matters Barnwell is obligated to pay Nearco, Inc. 10.4% of Kaupulehu Developments’ gross receipts from real estate transactions. The fees represent compensation for promotion and marketing of Kaupulehu Developments’ property and were determined based on the estimated fair value of such services. In conjunction with the closing of the Increment II transaction in fiscal 2006, Kaupulehu Developments entered into an agreement to pay its external real estate legal counsel 1.5% of all Increment II percentage of sales payments received by Kaupulehu Developments for services provided by its external real estate legal counsel in the negotiation and closing of the Increment II transaction. No amounts were paid pursuant to this arrangement in fiscal years 2014 or 2013.

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