10. Leases

The Company has operating leases for the use of equipment, corporate office space, and some of its terminal and distribution facilities. The leases have remaining lease terms of 1 to 7 years, with a weighted-average remaining lease term of 3 years at March 31, 2020. Some operating leases include options to extend the leases for up to 5 years. At January 1, 2019, upon implementation of ASU 2016-02, the liability for the Company’s operating leases was discounted to present value using a weighted-average discount rate of 3.5%. The components of lease costs for the three months ended March 31, 2020 and 2019 were as follows (in thousands):


		Three Months Ended March 31,
	Classification	2020		2019
Operating lease costs (1)	Cost of revenues	$	385	$	486
Operating lease costs (1)	Selling, general and administrative expenses		56		53
Rental revenues	Interest and other income, net		(27)		(12)
Net operating lease costs		$	414	$	527

(1)Includes the costs of leases with a term of 12 months or less.

As of March 31, 2020, future minimum payments under operating leases that were either non-cancelable or subject to significant penalty upon cancellation, including future minimum payments under renewal options that the Company is reasonably certain to exercise, were as follows (in thousands):



2020 (excluding the three months ended March 31, 2020)	$	1,211
2021		879
2022		374
2023		187
2024		174
Thereafter		90
Total future minimum lease payments		2,915
Less imputed interest		(135)
Present value of lease liabilities	$	2,780

Supplemental cash flow information pertaining to the Company’s leasing activity for the three months ended March 31, 2020 and 2019 were as follows (in thousands):


	Three Months Ended March 31,
	2020		2019
Cash payments for operating lease liabilities	$	447	$	375
Right-of-use assets obtained in exchange for operating lease obligations	$	—	$	484