We lease most of our administrative and educational facilities under non-cancelable operating leases expiring at various dates through 2032. Lease terms generally range from five to ten years with one to four renewal options for extended terms. In most cases, we are required to make additional payments under facility operating leases for taxes, insurance and other operating expenses incurred during the operating lease period, which are typically variable in nature.

We determine if a contract contains a lease when the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Upon identification and commencement of a lease, we establish a right of use (“ROU”) asset and a lease liability.

A lease component is defined as an asset within the lease contract that a lessee can benefit from the use of and is not highly dependent or interrelated with other assets in the arrangement. A lease contract may contain multiple lease components. A non-lease component is defined as a component of the lease that transfers a good or service for the underlying asset, such as maintenance services. We have determined that all of our leases contain one lease component related to the building and land. We have determined that treating the land together with the building as one lease component would not result in a significant difference from accounting for them as separate lease components. Additionally, we have elected the practical expedient to include both the lease component and the non-lease component as a single component when accounting for each lease and calculating the resulting lease liability and ROU asset. Any remaining contract consideration, such as property taxes and insurance, that does not meet the definition of a lease component or non-lease component would be allocated to the single lease component based on our election.

The lease liability represents future lease payments for lease and non-lease components discounted for present value. Lease payments that may be included in the lease liability include fixed payments, variable lease payments that are based on an index or rate and payments for penalties for terminating the lease if the lessee is reasonably certain to use a termination option, among others. Certain of our leases contain rent escalation clauses that are specifically stated in the lease and these are included in the calculation of

the lease liability. Variable lease payments for lease and non-lease components which are not based on an index or rate are excluded from the calculation of the lease liability and are recognized in the statements of income during the period incurred.

The ROU asset consists of the amount of the initial measurement of the lease liability and adjusted for any lease incentives, including rent abatements and tenant improvement allowances, and any initial direct costs incurred by the lessee. The ROU asset is amortized over the remaining lease term on a straight-line basis and recorded within educational services and facilities expense on our consolidated statements of income.

The lease term is determined by taking into account the initial period as stated in the lease contract and adjusted for any renewal options that the company is reasonably certain to exercise as well as any period of time that the lessee has control of the space before the stated initial term of the lease. If we determine that we are reasonably certain to exercise a termination option, the lease term is then adjusted to account for the expected termination date.

Quantitative information related to leases for the years ended December 31, 2022, 2021 and 2020 is presented in the following table (dollars in thousands):


	For the Year Ended December 31,
	2022			2021			2020
Lease expenses (1)
Fixed lease expenses - operating	$	11,033		$	11,442		$	12,379
Variable lease expenses - operating		3,726			3,173			6,389
Sublease income		(1,087	)		(1,359	)		(2,347	)
Total lease expenses	$	13,672		$	13,256		$	16,421

Other information
Gross operating cash flows for operating leases (2)	$	(16,827	)	$	(18,390	)	$	(23,577	)
Operating cash flows from subleases (2)	$	1,108		$	1,430		$	2,254

	As of December 31, 2022			As of December 31, 2021			As of December 31, 2020
Weighted average remaining lease term (in months) – operating leases		63			69			70
Weighted average discount rate – operating leases		4.8	%		4.9	%		4.9	%

As of December 31, 2022, future minimum lease payments under operating leases which are included in lease liabilities on our consolidated balance sheet are as follows (dollars in thousands):


	Operating Leases Total

2023 (1)	$	8,220
2024		7,403
2025		6,768
2026		6,914
2027 and thereafter		9,833
Total	$	39,138
Less: imputed interest		5,297
Present value of future minimum lease payments		33,841
Less: current lease liabilities		6,555
Non-current lease liabilities	$	27,286

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(1)

Amounts provided are for liabilities remaining as of December 31, 2022.

Historically, for certain of our leased locations, we have vacated the facility and have fully or partially subleased the space. As of December 31, 2022, we have one sublease remaining with a term ending May 30, 2023, for which we remain the guarantor under the lease and therefore become the intermediate lessor. We recognize sublease income as on offset to lease expense on our consolidated statements of income.

As of December 31, 2022, future sublease rental income of approximately $0.2 million under operating leases, will decrease our future minimum lease payments presented above.

We use discount rates to determine the net present value of our gross lease obligations when calculating the lease liability and related ROU asset. In cases in which the rate implicit in the lease is readily determinable, we use that discount rate for purposes of the net present value calculation. In most cases, our lease agreements do not have a discount rate that is readily determinable and therefore we use an estimate of our incremental borrowing rate. Our incremental borrowing rate is determined at lease commencement or lease modification and represents the rate of interest we would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment.

We have sixteen leases related to our ongoing operations which consist of administrative offices and university locations, of which four are less than one year and not included in the lease liability and ROU asset recorded within our consolidated balance sheet. For those leases that we are reasonably certain that we will extend or terminate the leases, we have taken those factors into account when determining the lease liability recorded within our consolidated balance sheet.

During the year ended December 31, 2022, we recorded $1.1 million of asset impairment charges related to certain ROU assets within the CTU segment. Management made the decision to no longer use the spaces associated with the ROU assets and as a result recorded an asset impairment charge in accordance with ASC Topic 360 for the remaining value of the ROU assets, adjusted for any early lease termination options that the Company plans to execute.