Leases

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Leases of Lessee Disclosure [Text Block]

Leases

The Company has operating and finance leases for corporate and field offices. We determine if an arrangement is a lease at inception or modification. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and corresponding lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Certain lease incentives such as free rent periods are recorded as a reduction of the ROU asset. The Company uses an incremental borrowing rate that is readily available in determining the present value of future lease payments. Lease costs for operating ROU assets is recognized on a straight-line basis over the lease term.

Certain leases include one or more options to renew with terms that can extend the lease from one year to 20 years. The exercise of any lease renewal option is at the sole discretion of the Company. Renewal options are included in the ROU assets and lease liabilities when they either provide an economic incentive to renew or when the costs related to the termination of a lease outweigh the benefits of signing a new lease. See Note 2 for further discussion on the Company's accounting policy on leases.

The following table presents the balances for operating and finance ROU assets and lease liabilities:

Leases	Classification	June 30, 2019
		(in millions)
Assets
Operating lease assets	Other assets	$	225
Finance lease assets	Other assets	56
Total lease assets		$	281
Liabilities
Operating lease liabilities	Other liabilities	$	246
Finance lease liabilities	Long-term debt	64
Total lease liabilities		$	310

The components of lease expense include operating and finance lease costs. For the three months and six months ended June 30, 2019 operating lease costs were $14 million and $29 million, respectively. For the three months and six months ended June 30, 2019, finance lease costs were $3 million and $5 million, respectively, and consisted of $2 million and $4 million, respectively, in amortization. These costs are recorded in general and administrative expenses in the Consolidated Statements of Operations. The amount of interest expense on finance leases was $1 million for both the three months and six months ended June 30, 2019. The interest expense costs are recorded in interest and debt expense in the Consolidated Statements of Operations.

Maturities of lease liabilities, weighted-average remaining term and weighted-average discount rate are as follows:

Maturity of Lease Liabilities	June 30, 2019
	Finance Leases			Operating Leases
	(in millions)
2019	$	8		$	27
2020	14			59
2021	10			45
2022	10			37
2023	10			30
Thereafter	19			75
Total lease payments	71			273
Less: Interest	(7		)	(27		)
Present value of lease liabilities	$	64		$	246
Weighted-average remaining lease term (years)	6.3			6.3
Weighted-average discount rate	3.4		%	3.1		%

Maturities of lease liabilities prior to the adoption of new lease guidance were as follows:

Maturity of Lease Liabilities	December 31, 2018
	Operating Leases
	(in millions)
2019	$	61
2020	53
2021	40
2022	33
2023	26
Thereafter	65
Total lease payments	$	278

For the six months ended June 30, 2019, operating lease cash flows included $31 million of cash paid for amounts included in the measurement of operating lease liabilities. For the six months ended June 30, 2019, financing lease cash flows included $6 million of cash paid for amounts included in the measurement of finance lease liabilities. For the six months ended June 30, 2019, operating cash flows included $1 million of cash paid for amounts included in the measurement of finance lease liabilities.