We lease office space for our manufacturing, sales and service operations, vehicles and office equipment under operating leases.

In accordance with Accounting Standard Codification Topic 842 (“ASC 842”) we have elected not to apply ASC 842 to arrangements with lease terms less than 12 months.

Operating lease right-of-use assets and liabilities are reflected within the captions “Right-of-use assets”, “Short-term operating lease liability” and “Long-term operating lease liability”, respectively, on the Consolidated Balance Sheet. Right-of-use assets, Short-term operating lease liability and Long-term operating lease liability were $3,850,000, $514,000 and $3,384,000 as of September 30, 2019, respectively.

When readily determinable, the discount rate used to calculate the lease liability is the rate implicit in the lease. Otherwise we applied judgement and used our incremental borrowing rate based on the information available at lease commencement.

Some of our leases include one or more renewal or termination options at our discretion, which are included in the determination of the lease term if we are reasonably certain to exercise the option.

There were no Right-of-use leased assets obtained in exchange for new operating lease liabilities for the three months ended September 30, 2019.

Lease expense, recorded in the cost of sales and selling, general & administrative expense categories in our Consolidated Statement of Operations total $184,000 for the first quarter of fiscal 2020.

Cash paid for operating leases was $182,000 during the three months ended September 30, 2019 and is included in operating cash flows.

	September 30, 2019
Years Ending June 30,	Lease Payments
2020 (excluding the three months ended September 30, 2019)	$	550
2021		608
2022		427
2023		363
2024		346
After 2024		3,002
Future value of operating lease liabilities	$	5,296
Less: Imputed interest		(1,398	)
Present value of operating lease liabilities	$	3,898

The weighted average remaining lease term for operating leases was 7 years and the weighted average discount rate was 5.3% as of September 30, 2019.