Leases, User Charges and Commitments

12 Months Ended

Dec. 31, 2016

Commitments And Contingencies Disclosure [Abstract]

NOTE 11. Leases, User Charges and Commitments

Minimum annual capital and operating lease payments, as of December 31, 2016, under non-cancelable leases, principally for containers, chassis, other equipment and real estate, as well as other commitments are payable as follows (in thousands):

Future Payments Due:

				Operating
				Leases and
	Capital			Other
	Lease			Commitments		Total
2017	$	3,167		$	8,998	$	12,165
2018		3,167			7,311		10,478
2019		3,167			5,502		8,669
2020		3,176			5,274		8,450
2021		1,840			5,402		7,242
2022 and thereafter		-			7,489		7,489
	$	14,517		$	39,976	$	54,493
Less: Imputed interest		(1,244	)
Net capital lease liability	$	13,273

Total rental expense included in general and administrative expense, which relates primarily to real estate, was approximately $8.3 million in 2016, $8.0 million in 2015 and $8.1 million in 2014. Many of the real estate leases contain renewal options and escalation clauses which require payments of additional rent to the extent of increases in the related operating costs. We straight-line rental expense in accordance with the FASB guidance in the Leases Topic of the Codification.

We incur rental expense for our leased containers, tractors and trailers that are included in transportation costs and totaled $3.6 million, $11.9 million, and $13.1 million for 2016, 2015 and 2014, respectively.

We incur user charges for use of a fleet of rail owned chassis, chassis under capital lease and dedicated rail owned containers on the Union Pacific and Norfolk Southern railroads which are included in transportation costs. Such charges were $73.7 million, $74.3 million and $67.8 million for 2016, 2015 and 2014, respectively. We have the ability to return the majority of the containers and pay for the rail owned chassis only when we are using them under these agreements. As a result, no minimum commitments related to these rail owned chassis and containers have been included in the table above.

In addition to the commitments above, in November 2016, we committed to acquire 4,000 53’ containers. We expect the total purchase price of these containers to be approximately $40 million. We expect to take delivery of the equipment between February and November of 2017. We are evaluating whether we finance the containers with a lease or debt.