Leases

12 Months Ended

Dec. 31, 2022

Leases

Leases

(7) Leases

The Company leases property and equipment under operating leases. For leases with durations longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of lease payments over the term. The Company used its incremental borrowing rate to discount the lease payments based on information available at lease commencement.

Aircraft

As of December 31, 2022, excluding aircraft financed by the Company’s major airline partners that the Company operates for them under contract, the Company had 43 aircraft under long-term lease agreements with remaining terms ranging from one year to eight years. The Company leases 32 CRJ aircraft under a lease agreement that expires in March 2024. During the year ended December 31, 2022, the Company began storing aircraft under this lease agreement, which shortened the Company’s estimated useful life of the aircraft under the lease and resulted in the Company recognizing $11.4 million of accelerated lease expense during the year ended December 31, 2022.

Airport facilities

The Company has operating leases for facility space including airport terminals, office space, cargo warehouses and maintenance facilities. The Company generally leases this space from government agencies that control the use of the various airports. The remaining lease terms for facility space vary from one month to 34 years. The Company’s operating leases with lease rates that are variable based on airport operating costs, use of the facilities or other variable factors are excluded from the Company’s right-of-use assets and operating lease liabilities in accordance with accounting guidance.

Leases

As of December 31, 2022, the Company’s right-of-use assets were $151.9 million, the Company’s current maturities of operating lease liabilities were $71.7 million, and the Company’s noncurrent lease liabilities were $88.6 million. During 2022, the Company paid $77.9 million in operating leases reflected as a reduction from operating cash flows.

The table below presents lease related terms and discount rates as of December 31, 2022.

	As of December 31, 2022
Weighted-average remaining lease term for operating leases	6.5 years
Weighted-average discount rate for operating leases	6.1%

The Company’s lease costs for 2022 and 2021 included the following components (in thousands):

	For the year ended December 31,
	2022		2021
Operating lease cost	$	97,998	$	89,891
Variable and short-term lease cost		1,830		4,468
Sublease income		(7,089)		(6,552)
Total lease cost	$	92,739	$	87,807

As of December 31, 2022, the Company leased aircraft, airport facilities, office space, and other property and equipment under non-cancelable operating leases, which are generally on a long-term, triple-net lease basis pursuant to which the Company pays taxes, maintenance, insurance and certain other operating expenses applicable to the leased property. The Company expects that, in the normal course of business, such operating leases that expire will be renewed or replaced by other leases, or the property may be purchased rather than leased.

The following table summarizes future minimum rental payments primarily related to leased aircraft and maintenance facilities required under operating leases that had initial or remaining non-cancelable lease terms as of December 31, 2022 (in thousands):

2023	$	74,557
2024		32,525
2025		15,837
2026		13,427
2027		12,291
Thereafter		54,298
	$	202,935

Total rental expense for non-cancelable aircraft operating leases was approximately $75.4 million, $63.4 million and $65.3 million for the years ended December 31, 2022, 2021, and 2020, respectively. The minimum rental expense for airport station rents was approximately $13.2 million, $17.2 million and $20.1 million for the years ended December 31, 2022, 2021, and 2020, respectively.