4. Leases

Our operating lease activities primarily consist of leases for real estate, landfills and heavy equipment. Our financing lease activities primarily consist of leases for heavy equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are recognized as lease expense on a straight-line basis over the lease term. Most leases include one or more options to renew, with renewal terms generally ranging from one to 10 years. The exercise of lease renewal options is at our sole discretion. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Certain of our lease agreements include rental payments based on usage and other lease agreements include rental payments adjusted periodically for inflation; these payments are treated as variable lease payments. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Supplemental balance sheet information as of March 31, 2019 for our leases is as follows (in millions):


Leases	Classification
Assets
Long-term:
Operating	Other assets	$	388
Financing	Property and equipment, net of accumulated depreciation and amortization		228
Total lease assets		$	616

Liabilities
Current:
Operating	Accrued liabilities	$	85
Financing	Current portion of long-term debt		22
Long-term:
Operating	Other liabilities		303
Financing	Long-term debt, less current portion		185
Total lease liabilities		$	595

Our operating lease expense for the three months ended March 31, 2019 was $28 million and is included in operating and selling, general and administrative expenses in our Condensed Consolidated Statement of Operations. Our financing lease expense for the three months ended March 31, 2019 was $14 million and is included in depreciation and amortization expense and interest expense, net in our Condensed Consolidated Statement of Operations.

Minimum contractual obligations for our leases (undiscounted) as of March 31, 2019 are as follows (in millions):


		Operating(a)		Financing(a)
2019 (excluding three months ended March 31, 2019)	$	67	$	28
2020		82		34
2021		59		31
2022		46		31
2023		42		29
Thereafter		414		188
Total	$	710	$	341

(a)

Includes $167 million and $61 million of undiscounted future minimum obligations related to additional operating and financing leases, respectively, which have not yet commenced.

Cash paid for our operating and financing leases was $22 million and $8 million, respectively, for the three months ended March 31, 2019. Right-of-use assets obtained in exchange for lease obligations for our operating leases were $23 million for the three months ended March 31, 2019. The amount related to our financing leases was not material to our consolidated financial statements.

As of March 31, 2019, the weighted average remaining lease terms of our operating and financing leases were 16 years and 12 years, respectively. The weighted average discount rates used to determine the lease liabilities as of March 31, 2019 for our operating and financing leases were 3.75% and 4.33%, respectively.