Landstar’s noncancelable leases are primarily comprised of finance leases for the acquisition of new trailing equipment. Each finance lease for the acquisition of trailing equipment is a five year lease with a $1 purchase option for the applicable equipment at lease expiration. Substantially all of Landstar’s operating lease right-of-use assets and operating lease liabilities represent leases for orientation centers for BCO Independent Contractors and office space used to conduct Landstar’s business. These leases do not have significant rent escalation holidays, concessions, leasehold improvement incentives or other build-out clauses. Further, the leases do not contain contingent rent provisions. Landstar also leases certain trailing equipment to supplement the Company-owned trailer fleet under “month-to-month” lease terms, which are not required to be recorded on the balance sheet due to the less than twelve month lease term exemption. Sublease income is primarily comprised of weekly trailing equipment rentals to our BCO Independent Contractors.

Most of Landstar’s operating leases include one or more options to renew. The exercise of lease renewal options is typically at Landstar’s sole discretion, and, as such, the majority of renewals to extend the lease terms are not included in the

right-of-use

assets and lease liabilities as they are not reasonably certain of exercise. Landstar regularly evaluates the renewal options, and when they are reasonably certain of exercise, Landstar includes the renewal period in the lease term.

As most of Landstar’s operating leases do not provide an implicit rate, Landstar utilized its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. Landstar has a centrally managed treasury function; therefore, based on the applicable lease terms and the current economic environment, we apply a portfolio approach for determining the incremental borrowing rate.

The components of lease cost for finance leases and operating leases for the twenty six weeks ended June 29, 2019 were (in thousands):


Finance leases:
Amortization of right-of-use assets	$	13,132
Interest on lease liability		1,928

Total finance lease cost		15,060
Operating leases:
Lease cost		2,280
Variable lease cost		—
Sublease income		(2,571	)

Total operating lease (income)/cost		(291	)

Total lease cost	$	14,769

A summary of the lease classification on our consolidated balance sheet as of June 29, 2019 is as follows (in thousands):

Assets:

The following table reconciles the undiscounted cash flows for the finance and operating leases to the finance and operating lease liabilities recorded on the balance sheet at June 29, 2019 (in thousands):


	Finance Leases		Operating Leases
2019 Remainder	$	21,586	$	445
2020		39,475		681
2021		25,065		616
2022		15,902		622
2023		8,875		551
Thereafter		—		301

Total future minimum lease payments		110,903		3,216

Less amount representing interest (2.1% to 4.4%)		6,136		287

Present value of minimum lease payments	$	104,767	$	2,929

Current maturities of long-term debt		39,194
Long-term debt, excluding current maturities		65,573
Other current liabilities				715
Deferred income taxes and other noncurrent liabilities				2,214

The weighted average remaining lease term and the weighted average discount rate for finance and operating leases as of June 29, 2019 were:


	Finance Leases			Operating Leases
Weighted average remaining lease term (years)		3.2			4.6
Weighted average discount rate		3.2	%		4.0	%

Operating lease
right-of-use
assets

Other assets

Finance lease assets

Operating property, less accumulated
depreciation and amortization

Total lease assets