LEASES

6 Months Ended

Jun. 30, 2020

Note 2: Leases

Our portfolio of nonmineral leases is composed almost entirely of operating leases (we do not have any material finance leases) for real estate (including office buildings, aggregates sales yards, and concrete and asphalt sites) and equipment (including railcars and rail track, barges, office equipment and plant equipment).

Operating lease ROU assets and liabilities and the weighted-average lease term and discount rate are as follows:



		June 30	December 31	June 30
in thousands	Classification on the Balance Sheet	2020	2019	2019
Assets
Operating lease ROU assets		$ 472,003	$ 441,656	$ 435,672
Accumulated amortization		(45,385)	(33,467)	(16,776)
Total lease assets	Operating lease right-of-use assets, net	$ 426,618	$ 408,189	$ 418,896
Liabilities
Current
Operating	Other current liabilities	$ 32,645	$ 29,971	$ 31,357
Noncurrent
Operating	Operating lease liabilities	405,578	388,042	396,952
Total lease liabilities		$ 438,223	$ 418,013	$ 428,309
Lease Term and Discount Rate
Weighted-average remaining lease term (years)
Operating leases		10.4	9.9	10.0
Weighted-average discount rate
Operating leases		4.1%	4.3%	4.4%

Our lease agreements do not contain residual value guarantees, restrictive covenants or early termination options that we deem material. We have not sought or been granted any material lease concessions as a result of the COVID-19 pandemic.

Lease expense for operating leases is recognized on a straight-line basis over the lease term. The components of operating lease expense are as follows:



	Three Months Ended		Six Months Ended
	June 30		June 30
in thousands	2020	2019	2020	2019
Lease Cost
Operating lease cost	$ 14,234	$ 14,167	$ 28,340	$ 28,294
Short-term lease cost ¹	8,070	7,922	17,441	16,623
Variable lease cost	3,773	3,489	6,905	6,557
Sublease income	(721)	(807)	(1,456)	(1,418)
Total lease cost	$ 25,356	$ 24,771	$ 51,230	$ 50,056


¹	Our short-term lease cost includes the cost of leases with an initial term of one month or less.

Cash paid for operating leases was $26,559,000 and $25,513,000 for the six months ended June 30, 2020 and 2019, respectively, and was reflected as reductions to operating cash flows.