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Leases
 3 Months Ended
Mar. 31, 2019
Leases [Abstract]  
Leases Leases
Basic adopted ASU No. 2016-02, Topic 842 - Leases, effective January 1, 2019. This ASU requires lessees to recognize an operating lease right-of-use ("ROU") asset and liability on the balance sheet for all operating leases with an initial lease term greater than twelve months.
Per ASU 2018-11 Leases – Targeted Improvements, allowed for a practical expedient wherein all periods previously reported under ASC 840 will continue to be reported under ASC 840, and periods beginning January 1, 2019 and after are reported under ASC 842. Basic elected to adopt this practical expedient along with the package of practical expedients which allows Basic to combine lease and non-lease costs, and not to assess whether existing or or expired land easements that were not previously accounted for as leases under Topic 840 are or contain a lease under this Topic.  
Under this transition option, Basic will continue to apply the legacy guidance in ASC 840, including its disclosure requirements, in the comparative periods presented and will make only annual disclosures for the comparative periods because ASC 840 does not require interim disclosures. Prior period amounts have not been adjusted and continue to be reflected in accordance with Basic’s historical accounting. The adoption of this standard resulted in the recording of ROU assets and lease liabilities of approximately of $20.8 million as of January 1, 2019, with no related impact on Basic’s Consolidated Statement of Equity or Consolidated Statement of Income (Loss).
As a lessee, Basic leases its corporate office headquarters in Fort Worth, Texas, and conducts its business operations through various regional offices located throughout the United States. These operating locations typically include regional offices, storage and maintenance yards, disposal facilities and employee housing sufficient to support its operations in the area. Basic leases most of these properties under non-cancelable term and month-to-month operating leases, many of which contain renewal options that can extend the lease term from one to five years and some of which contain escalation clauses. Basic also leases supplemental equipment, typically under cancelable short-term and very short term (less than 30 days) leases. Due to the nature of the Company's business, any option to renew these short-term leases, and the options to extend certain of its long-term real estate leases, are generally not considered reasonably certain to be exercised. Therefore, the periods covered by such optional periods are not included in the determination of the term of the lease, and the lease payments during these periods are similarly excluded from the calculation of operating lease asset and lease liability balances.
Basic recognizes rent expense on a straight-line basis, except for certain variable expenses which are recognized when the variability is resolved, typically during the period in which they are paid. Variable lease payments typically include charges for property taxes and insurance, and some leases contain variable payments related to non-lease components, including common area maintenance and usage of facilities or office equipment (for example, copiers), which totaled approximately $0.3 million during the three months ended March 31, 2019. Prepaid rent total $0.2 million during the three months ended March, 31, 2019. Operating lease expense consists of rent expense related to leases which were included in ROU assets under Topic 842. The following table summarizes the components of the Company's lease expense recognized for the three months ending March 31, 2019, excluding variable lease and prepaid rent costs (amounts in thousands):  
Three Months ended
March 31, 2019
Operating lease expense:
Short-term operating lease expense$1,974 
Long-term operating lease expense2,185 
Total operating lease expense$4,159 
Finance lease expense:
Amortization of right-of-use assets$5,440 
Interest on lease liabilities1,382 
Total finance lease expense$6,822 
Supplemental information related to leases was as follows:
Weighted Average Remaining Lease Term (in years)
Operating leases3.0
Finance leases2.6
Weighted Average Discount Rate
Operating leases14.4%  
Finance leases8.0%  
Supplemental cash flow information related to leases was as follows for the periods presented (in thousands):
Three Months ended
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities: 
Operating cash outflows from operating leases$4,159 
Operating cash outflows from finance leases1,382 
Financing cash outflows from finance leases11,423 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$— 
Finance leases6,144 
Supplemental balance sheet information related to leases was as follows for the periods presented (in thousands):
March 31, 2019December 31, 2018
Right-of-Use Assets under Operating Leases
Operating lease right-of-use assets$19,321 $20,819 
Operating lease right-of-use liabilities, current portion5,347 5,649 
Operating lease right-of-use liabilities, long-term portion13,974 15,170 
Total operating lease liabilities$19,321 $20,819 
Right-of-Use Assets under Finance Leases
Property and equipment, at cost$81,012 $102,852 
Accumulated depreciation(22,513)(31,954)
Property and equipment, net$58,499 $70,898 
Current portion of long-term debt$22,824 $27,519 
Long-term debt32,806 33,390 
Total finance lease liabilities$55,630 $60,909 
The Company adopted ASU 2016-02 on January 1, 2019 as noted above, and as required, the following disclosure is provided for periods prior to adoption. Future annual minimum lease payments and capital lease commitments as of December 31, 2018 were as follows (in thousands):
Operating LeasesFinance Leases
2019$8,179 $27,519 
20206,323 19,322
20215,438 10,697
20224,696 3,233
20231,248 83
Thereafter1,215 55
Total lease payments$27,099 $60,909 
Maturities of lease liabilities were as follows at March 31, 2019 (in thousands):
Operating LeasesFinance Leases
2019$5,926 $17,575 
20206,398 20,463
20215,517 12,156
20224,775 4,786
20231,308 595
Thereafter1,158 55
Total lease payments$25,082 $55,630 
Impact of discounting(5,761)
Discounted value of operating lease obligations$19,321 
Current operating lease liabilities$4,151 
Noncurrent operating lease liabilities15,170 
$19,321 
Leases Leases
Basic adopted ASU No. 2016-02, Topic 842 - Leases, effective January 1, 2019. This ASU requires lessees to recognize an operating lease right-of-use ("ROU") asset and liability on the balance sheet for all operating leases with an initial lease term greater than twelve months.
Per ASU 2018-11 Leases – Targeted Improvements, allowed for a practical expedient wherein all periods previously reported under ASC 840 will continue to be reported under ASC 840, and periods beginning January 1, 2019 and after are reported under ASC 842. Basic elected to adopt this practical expedient along with the package of practical expedients which allows Basic to combine lease and non-lease costs, and not to assess whether existing or or expired land easements that were not previously accounted for as leases under Topic 840 are or contain a lease under this Topic.  
Under this transition option, Basic will continue to apply the legacy guidance in ASC 840, including its disclosure requirements, in the comparative periods presented and will make only annual disclosures for the comparative periods because ASC 840 does not require interim disclosures. Prior period amounts have not been adjusted and continue to be reflected in accordance with Basic’s historical accounting. The adoption of this standard resulted in the recording of ROU assets and lease liabilities of approximately of $20.8 million as of January 1, 2019, with no related impact on Basic’s Consolidated Statement of Equity or Consolidated Statement of Income (Loss).
As a lessee, Basic leases its corporate office headquarters in Fort Worth, Texas, and conducts its business operations through various regional offices located throughout the United States. These operating locations typically include regional offices, storage and maintenance yards, disposal facilities and employee housing sufficient to support its operations in the area. Basic leases most of these properties under non-cancelable term and month-to-month operating leases, many of which contain renewal options that can extend the lease term from one to five years and some of which contain escalation clauses. Basic also leases supplemental equipment, typically under cancelable short-term and very short term (less than 30 days) leases. Due to the nature of the Company's business, any option to renew these short-term leases, and the options to extend certain of its long-term real estate leases, are generally not considered reasonably certain to be exercised. Therefore, the periods covered by such optional periods are not included in the determination of the term of the lease, and the lease payments during these periods are similarly excluded from the calculation of operating lease asset and lease liability balances.
Basic recognizes rent expense on a straight-line basis, except for certain variable expenses which are recognized when the variability is resolved, typically during the period in which they are paid. Variable lease payments typically include charges for property taxes and insurance, and some leases contain variable payments related to non-lease components, including common area maintenance and usage of facilities or office equipment (for example, copiers), which totaled approximately $0.3 million during the three months ended March 31, 2019. Prepaid rent total $0.2 million during the three months ended March, 31, 2019. Operating lease expense consists of rent expense related to leases which were included in ROU assets under Topic 842. The following table summarizes the components of the Company's lease expense recognized for the three months ending March 31, 2019, excluding variable lease and prepaid rent costs (amounts in thousands):  
Three Months ended
March 31, 2019
Operating lease expense:
Short-term operating lease expense$1,974 
Long-term operating lease expense2,185 
Total operating lease expense$4,159 
Finance lease expense:
Amortization of right-of-use assets$5,440 
Interest on lease liabilities1,382 
Total finance lease expense$6,822 
Supplemental information related to leases was as follows:
Weighted Average Remaining Lease Term (in years)
Operating leases3.0
Finance leases2.6
Weighted Average Discount Rate
Operating leases14.4%  
Finance leases8.0%  
Supplemental cash flow information related to leases was as follows for the periods presented (in thousands):
Three Months ended
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities: 
Operating cash outflows from operating leases$4,159 
Operating cash outflows from finance leases1,382 
Financing cash outflows from finance leases11,423 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$— 
Finance leases6,144 
Supplemental balance sheet information related to leases was as follows for the periods presented (in thousands):
March 31, 2019December 31, 2018
Right-of-Use Assets under Operating Leases
Operating lease right-of-use assets$19,321 $20,819 
Operating lease right-of-use liabilities, current portion5,347 5,649 
Operating lease right-of-use liabilities, long-term portion13,974 15,170 
Total operating lease liabilities$19,321 $20,819 
Right-of-Use Assets under Finance Leases
Property and equipment, at cost$81,012 $102,852 
Accumulated depreciation(22,513)(31,954)
Property and equipment, net$58,499 $70,898 
Current portion of long-term debt$22,824 $27,519 
Long-term debt32,806 33,390 
Total finance lease liabilities$55,630 $60,909 
The Company adopted ASU 2016-02 on January 1, 2019 as noted above, and as required, the following disclosure is provided for periods prior to adoption. Future annual minimum lease payments and capital lease commitments as of December 31, 2018 were as follows (in thousands):
Operating LeasesFinance Leases
2019$8,179 $27,519 
20206,323 19,322
20215,438 10,697
20224,696 3,233
20231,248 83
Thereafter1,215 55
Total lease payments$27,099 $60,909 
Maturities of lease liabilities were as follows at March 31, 2019 (in thousands):
Operating LeasesFinance Leases
2019$5,926 $17,575 
20206,398 20,463
20215,517 12,156
20224,775 4,786
20231,308 595
Thereafter1,158 55
Total lease payments$25,082 $55,630 
Impact of discounting(5,761)
Discounted value of operating lease obligations$19,321 
Current operating lease liabilities$4,151 
Noncurrent operating lease liabilities15,170 
$19,321