Operating Leases

12 Months Ended

Dec. 31, 2011

Leases [Abstract]

Operating Leases

Operating Leases

The following is a schedule of operating leases that Cleco maintains in the ordinary course of business activities. The majority of Cleco’s operating leases are for line construction and operating vehicles and for railcars for coal deliveries, which are utilized by Cleco Power. The remaining leases provide for office and operating facilities and office equipment. These leases have various terms and expiration dates. The following table is a summary of expected operating lease payments for Cleco and Cleco Power for the years indicated.

			YEAR ENDING DECEMBER 31,
(THOUSANDS)	CLECO		CLECO POWER		TOTAL
2012	$	24	$	12,412	$	12,436
2013	4		12,540		12,544
2014	5		4,048		4,053
2015	—		3,900		3,900
2016	—		3,325		3,325
Thereafter	—		16,836		16,836
Total operating lease payments	$	33	$	53,061	$	53,094

Cleco’s operating leases for line construction and maintenance vehicles have a term of seven years with an additional one-year renewal. The lease payment is determined by taking the equipment’s original cost multiplied by the adjusted rental factor. Contingent rents are based on the change in the LIBOR rate at May 15, 2001, compared to December 31, 2011, 2010, and 2009. For the years ended December 31, 2011, 2010, and 2009, lease expenses of $1.0 million, $1.1 million, and $1.4 million, respectively, were recognized. Contingent rents were less than $0.1 million for each of the years ended December 31, 2011, 2010, and 2009.

The railcar leases are divided into two groups. The first group has 120 railcars, and the lease expires on March 31, 2021. The second group has 121 railcars, and the lease expires on March 31, 2017. Cleco Power pays a monthly rental fee per car. For each of the years ended December 31, 2011, 2010, and 2009, an operating lease expense of $1.1 million was recognized. The railcar leases do not contain contingent rent payments.

Cleco Power’s operating leases for line construction and service vehicles have lease terms from five to seven years. The lease payment is determined by taking the equipment’s acquisition cost multiplied by the rental payment factor. For the years ended December 31, 2011, and 2010, an operating lease expense of $0.4 million and $0.2 million was recognized, respectively. The vehicle leases do not contain contingent rent payments.

Cleco’s operating leases for vehicles, office and operating facilities, and office equipment had lease terms from three to ten years. The monthly lease payment was determined by summing the monthly equipment amortization with the lowest monthly interest rate multiplied by the amortized value. Contingent rents were calculated by comparing the difference between the lowest rate at December 1984 to the lowest rate at December of each year. In November 2009, Cleco Power purchased all vehicles and equipment under this lease agreement and as a result there was no lease expense or contingent rent recognized for the years ended December 31, 2011, and 2010. For the year ended December 31, 2009, lease expenses of $6.5 million was recognized. For the year ended December 31, 2009, contingent rents were $0.5 million. For more information regarding operating leases, see Note 14 — “Litigation, Other Commitments and Contingencies, and Disclosures about Guarantees — Other Commitments — CBL Capital Corporation.”