Leases

3 Months Ended

Mar. 31, 2024

Leases

Leases

4. Leases

At the inception of an arrangement, the Company determines if an arrangement is, or contains, a lease based on facts and circumstances present in that arrangement. Lease classifications, recognition, and measurement are then determined at the lease commencement date.

The Company’s operating lease right-of-use (“ROU”) assets and operating lease liabilities include primarily leases for office and warehouse spaces used to conduct our business. The Company’s operating leases also include a building with land utilized for our waste treatment operations which includes a purchase option. Finance leases consist primarily of processing and transport equipment used by our facilities’ operations.

The components of lease cost for the Company’s leases were as follows (in thousands):

	Three Months Ended
	March 31,
	2024		2023
Operating Lease:
Lease cost	$	143	$	156
Finance Leases:
Amortization of ROU assets		65		38
Interst on lease liablity		22		6
		87		44
Total lease cost	$	230	$	200

The weighted average remaining lease term and the weighted average discount rate for operating and finance leases at March 31, 2024 were:

	Operating Leases			Finance Leases
Weighted average remaining lease terms (years)		5.4			4.3
Weighted average discount rate		7.6	%		8.8	%

The weighted average remaining lease term and the weighted average discount rate for operating and finance leases at March 31, 2023 were:

	Operating Leases			Finance Leases
Weighted average remaining lease terms (years)		6.1			3.0
Weighted average discount rate		7.8	%		5.5	%

The following table reconciles the undiscounted cash flows for the operating and finance leases at March 31, 2024, to the operating and finance lease liabilities recorded on the balance sheet (in thousands):

	Operating Leases			Finance Leases
2024	$	372		$	275
2025		433			345
2026		416			192
2027		406			157
2028		383			134
2029 and thereafter		366			102
Total undiscounted lease payments		2,376			1,205
Less: Imputed interest		(436	)		(212	)
Present value of lease payments	$	1,940		$	993
Current portion of operating lease obligations	$	346		$	—
Long-term operating lease obligations, less current portion	$	1,594		$	—
Current portion of finance lease obligations	$	—		$	287
Long-term finance lease obligations, less current portion	$	—		$	706

Supplemental cash flow and other information related to our leases were as follows (in thousands):

	Three Months Ended
	March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	147	$	144
Operating cash flow from finance leases	$	22	$	6
Financing cash flow from finance leases	$	75	$	41
ROU assets obtained in exchange for lease obligations for:
Finance liabilities	$	—	$	50