U.S. Department of State Fiscal Year 2019 Agency Financial Report

Future Minimum Lease Payments: 2019 Fiscal Year Lease Payments 2020 $ 12 2021 11 2022 11 2023 8 2024 5 2025 and thereafter 86 Total Minimum Lease Payments 133 Less: Amount Representing Interest (69) Liabilities under Capital Leases $ 64 2018 Fiscal Year Lease Payments 2019 $ 13 2020 12 2021 12 2022 12 2023 8 2024 and thereafter 91 Total Minimum Lease Payments 148 Less: Amount Representing Interest (75) Liabilities under Capital Leases $ 73 Operating Leases The Department leases real property under operating leases. These leases are non-Federal and expire in various years. Minimum future rental payments under operating leases have remaining terms in excess of one year as of September 30, 2019 and 2018 for each of the next 5 years and in aggregate are as follows (dollars in millions) : Year Ended September 30, 2019 Operating Lease Amounts 2020 $ 431 2021 329 2022 227 2023 136 2024 76 2025 and thereafter 172 Total Minimum Future Lease Payments $ 1,371 Year Ended September 30, 2018 Operating Lease Amounts 2019 $ 419 2020 323 2021 222 2022 152 2023 79 2024 and thereafter 190 Total Minimum Future Lease Payments $ 1,385  12  C ontingencies and C ommitments Contingencies The Department is a party in various material legal matters (litigation, claims, assessments, including pending or threatened litigation, unasserted claims, and claims that may derive from treaties or international agreements) brought against it. We periodically review these matters pending against us. As a result of these reviews, we classify and adjust our contingent liability when we think it is probable that there will be an unfavorable outcome and when a reasonable estimate of the amount can be made. Additionally, as part of our continuing evaluation of estimates required in the preparation of our financial statements, we evaluated the materiality of cases determined to have either a probable or reasonably possible chance of an adverse outcome. As a result of these reviews, the Department believes that claims considered probable could result in estimable losses of $25 to $795 million and reasonably possible claims could result in potential estimable losses of $0 to $60 million if the outcomes were adverse to the Department. The probable cases involve claims related to residential construction, Equal Employment Opportunity Commission claims, and International claims made against the United States. The reasonably possible cases involve contract disputes, claims related to embassy construction, and international claims made against the United States being litigated by the Department. Certain legal matters to which the Department is a party are administered and, in some instances, litigated and paid by 92 | U nited S tates D epartment of S tate 2019 A gency F inancial R eport FINANCIAL SECTION | NOTES TO THE PRINCIPAL FINANCIAL STATEMENTS