Note 10 - Leasing Activities

12 Months Ended

Dec. 31, 2016

Leases of Lessee Disclosure [Text Block]

10.

LEASING ACTIVITIES

Vehicle Leases as Lessee

The Company leases vehicles, as lessee, primarily over periods ranging from

one

ten

years under operating lease and capital lease arrangements. Generally, the Company is required to incur all operating costs and pay a minimum rental. The Company usually guarantees the residual value of vehicles under operating lease and capital lease arrangements. At

December

31,

2016,

the Company guaranteed vehicle residual values of

$0.5

million under operating lease arrangements and

$34.0

million under capital lease arrangements. Historically, the Company purchases these vehicles at the end of the lease term and recognizes a gain on the subsequent sale of the vehicle. The residual values are not reflected in the future minimum lease payments for operating leases. Vehicle lease expenses were approximately

$1.3

million for the year ended

December

31,

2016,

$2.4

million for the year ended

December

31,

2015,

and

$4.1

million for the year ended

December

31,

2014.

As discussed below, these vehicles are then subleased by the Company to customers under various agreements. Future minimum sublease rentals to be received by the Company under non-cancelable subleases, as described below, are

$75.2

million.

Future minimum lease payments under capital and non-cancelable vehicle leases as of

December

31,

2016,

are as follows (in thousands):

	Capital Leases			Operating Leases
2017	$	17,029		$	819
2018		17,657			672
2019		18,264			602
2020		16,977			342
2021		10,936			342
Thereafter		11,659			190

Total minimum lease payments	$	92,522		$	2,967
Less amount representing interest		(8,029	)
Present value of net minimum capital lease payments		84,493
Less current portion		(14,449	)
Obligations under capital leases less current portion	$	70,044

Customer Vehicle Leases as Lessor

The Company leases both owned and leased vehicles to customers, through its PacLease and Idealease franchises, primarily over periods of

one

ten

years, under operating lease arrangements, which require a minimum rental payment and a contingent rental payment based on mileage. Rental income during the year ended

December

31,

2016,

consisted of minimum rental payments of approximately

$182.1

million and contingent rental payments of

$27.8

million. Rental income during the year ended

December

31,

2015,

consisted of minimum rental payments of approximately

$175.0

million and contingent rental payments of

$27.4

million. Rental income during the year ended

December

31,

2014,

consisted of minimum rental payments of approximately

$154.8

million and contingent rental payments of

$24.5

million. Minimum rental payments to be received for non-cancelable leases and subleases in effect at

December

31,

2016,

are as follows (in thousands):

2017	$	121,335
2018		103,092
2019		81,532
2020		58,660
2021		34,083
Thereafter		17,257

Total	$	415,959

As of

December

31,

2016,

the Company had

$570.1

million of lease vehicles included in property and equipment, net of accumulated depreciation of

$262.6

million. As of

December

31,

2015,

the Company had

$592.0

million of lease vehicles included in property and equipment, net of accumulated depreciation of

$233.8

million.

Other Leases - Land and Buildings

The Company leases various assets under operating leases with expiration dates ranging from

February

2017

through

May

2045.

Monthly rental payments range from approximately

$275

per month to

$46,479

per month. Rental expense was

$10.3

million for the year ended

December

31,

2016,

$11.8

million for the year ended

December

31,

2015,

and

$12.8

million for the year ended

December

31,

2014.

Future minimum lease payments under non-cancelable leases at

December

31,

2015,

are as follows (in thousands):

2017	$	8,180
2018		6,341
2019		4,639
2020		3,404
2021		1,899
Thereafter		16,336

Total	$	40,799