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Leases
 12 Months Ended
Dec. 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.
ASU 2018-11 Leases – Targeted Improvements, allows 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 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 Shareholders' Equity or Consolidated Statement of Operations.
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 either non-cancelable term 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, or month-to-month operating leases. Options to renew these 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. Basic also leases supplemental equipment, typically under cancellable short-term or contracts which are less than 30 days. Due to the nature of the Company's business, any option to renew these short-term leases is 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.
Operating lease expense consists of rent expense related to leases that were included in ROU assets under Topic 842. Basic recognizes operating lease expense on a straight-line basis, except for certain variable expenses that are recognized when the variability is resolved, typically during the period in which they are paid. Variable operating 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 $1.1 million during the twelve months ended December 31, 2019. Prepaid rent totaled $0.1 million at December 31, 2019.
The following table summarizes the components of the Company's lease expense recognized for the twelve months ended December 31, 2019, excluding variable lease and prepaid rent costs (in thousands):
December 31, 2019
Operating lease expense:
   Short-term operating lease$5,691  
   Long-term operating lease 8,681  
Total operating lease expense$14,372  
Finance lease expense:
   Amortization of right-of-use assets$19,171  
   Interest on lease liabilities5,005  
Total finance lease expense$24,176  
Supplemental information related to leases was as follows:
December 31, 2019
Operating leases
Weighted average remaining lease term3.1 years
Weighted average discount rate14.8%  
Finance leases
Weighted average remaining lease term2.1 years
Weighted average discount rate8.2%  
Supplemental cash flow information related to leases was as follows for the year ended December 31, 2019 (in thousands):
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:  
   Operating cash outflows from operating leases$14,372  
   Operating cash outflows from finance leases5,005  
   Financing cash outflows from finance leases29,364  
Right-of-use assets obtained in exchange for lease obligations:
   Operating leases2,477  
   Finance leases7,941  
Supplemental balance sheet information related to leases was as follows as of December 31, 2019, and December 31, 2018 (in thousands):
December 31, 2019December 31, 2018
Right-of-Use Assets under Operating Leases
Operating lease right-of-use assets$14,540  $20,819  
Operating lease right-of-use liabilities, current portion4,906  5,649  
Operating lease right-of-use liabilities, long-term portion9,634  15,170  
   Total operating lease liabilities$14,540  $20,819  
Right-of-Use Assets under Finance Leases
Property and equipment, at cost$71,768  $67,585  
Less accumulated depreciation(27,727) (16,634) 
   Property and equipment, net$44,041  $50,951  
Current portion of finance leases$18,738  $20,061  
Long-term finance leases17,160  29,865  
   Total finance lease liabilities$35,898  $49,926  
Future annual minimum operating lease payments were as follows (in thousands):
December 31,
2019
2020$6,618  
20215,227  
20224,393  
2023942  
2024721  
Thereafter325  
Total lease payments$18,226  
Impact of discounting(3,686) 
Discounted value of operating lease obligation$14,540  
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.
ASU 2018-11 Leases – Targeted Improvements, allows 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 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 Shareholders' Equity or Consolidated Statement of Operations.
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 either non-cancelable term 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, or month-to-month operating leases. Options to renew these 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. Basic also leases supplemental equipment, typically under cancellable short-term or contracts which are less than 30 days. Due to the nature of the Company's business, any option to renew these short-term leases is 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.
Operating lease expense consists of rent expense related to leases that were included in ROU assets under Topic 842. Basic recognizes operating lease expense on a straight-line basis, except for certain variable expenses that are recognized when the variability is resolved, typically during the period in which they are paid. Variable operating 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 $1.1 million during the twelve months ended December 31, 2019. Prepaid rent totaled $0.1 million at December 31, 2019.
The following table summarizes the components of the Company's lease expense recognized for the twelve months ended December 31, 2019, excluding variable lease and prepaid rent costs (in thousands):
December 31, 2019
Operating lease expense:
   Short-term operating lease$5,691  
   Long-term operating lease 8,681  
Total operating lease expense$14,372  
Finance lease expense:
   Amortization of right-of-use assets$19,171  
   Interest on lease liabilities5,005  
Total finance lease expense$24,176  
Supplemental information related to leases was as follows:
December 31, 2019
Operating leases
Weighted average remaining lease term3.1 years
Weighted average discount rate14.8%  
Finance leases
Weighted average remaining lease term2.1 years
Weighted average discount rate8.2%  
Supplemental cash flow information related to leases was as follows for the year ended December 31, 2019 (in thousands):
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:  
   Operating cash outflows from operating leases$14,372  
   Operating cash outflows from finance leases5,005  
   Financing cash outflows from finance leases29,364  
Right-of-use assets obtained in exchange for lease obligations:
   Operating leases2,477  
   Finance leases7,941  
Supplemental balance sheet information related to leases was as follows as of December 31, 2019, and December 31, 2018 (in thousands):
December 31, 2019December 31, 2018
Right-of-Use Assets under Operating Leases
Operating lease right-of-use assets$14,540  $20,819  
Operating lease right-of-use liabilities, current portion4,906  5,649  
Operating lease right-of-use liabilities, long-term portion9,634  15,170  
   Total operating lease liabilities$14,540  $20,819  
Right-of-Use Assets under Finance Leases
Property and equipment, at cost$71,768  $67,585  
Less accumulated depreciation(27,727) (16,634) 
   Property and equipment, net$44,041  $50,951  
Current portion of finance leases$18,738  $20,061  
Long-term finance leases17,160  29,865  
   Total finance lease liabilities$35,898  $49,926  
Future annual minimum operating lease payments were as follows (in thousands):
December 31,
2019
2020$6,618  
20215,227  
20224,393  
2023942  
2024721  
Thereafter325  
Total lease payments$18,226  
Impact of discounting(3,686) 
Discounted value of operating lease obligation$14,540