Effective January 1, 2019, the Company adopted ASU 2016-02 Leases (Topic 842). As of December 31, 2022, substantially all of the Company's leases are operating leases for real estate property bank branches, ATM locations, and office space. These leases are generally for periods of 1 to 25 years with various renewal options. The Company elected the optional transition method permitted by Topic 842. Under this method, an entity recognizes and measures leases that exist at the application date and prior comparative periods are not adjusted. In addition, the Company elected the package of practical expedients:

The Company also elected the practical expedient, which may be elected separately or in conjunction with the package noted above, to use hindsight in determining the lease term and in assessing the right-of-use assets. This expedient must be applied consistently to all leases. Lastly, the Company has elected to use the practical expedient to include both lease and non-lease components as a single component and account for it as a lease. In addition, the Company has elected not to include short-term leases (i.e. leases with terms of twelve months or less) or equipment leases (primarily copiers) deemed immaterial, on the consolidated balance sheets.

For leases in effect at January 1, 2019 and for leases commencing thereafter, the Company recognizes a lease liability and a right-of-use asset, based on the present value of lease payments over the lease term. The discount rate used in determining the present value was the Company's incremental borrowing rate which is the FHLB fixed advance rate based on the remaining lease term as of January 1, 2019, or the commencement date for leases subsequently entered into. The following table contains supplemental balance sheet information related to leases (dollars in thousands):


	2022			2021
Operating lease right-of-use assets	$	15,774		$	15,116
Operating lease liabilities		16,035			15,322
Weighted-average remaining lease term	5.8 years			6.6 years
Weighted-average discount rate		2.67	%		2.70	%

Certain of the Company's leases contain options to renew the lease; however, not all renewal options are included in the calculation of lease liabilities as they are not reasonably certain to be exercised. The Company's leases do not contain residual value guarantees or material variable lease payments. The Company does not have any other material restrictions or covenants imposed by leases that would impact the Company's ability to pay dividends or cause the Company to incur additional financial obligations.

Future minimum lease payments under operating leases are (in thousands):


	Operating Leases
2023	$	3,035
2024		2,615
2025		2,178
2026		2,067
2027		3,587
Thereafter		4,488
Total minimum lease payments		17,970
Less imputed interest		(1,935	)
Total lease liability	$	16,035

The components of lease expense for the twelve months ended December 31, 2022 and 2021 were as follows (in thousands):


	2022			2021
Operating lease cost	$	3,040		$	2,515
Short-term lease cost		75			260
Variable lease cost		720			871
Total lease cost		3,835			3,646
Income from subleases		(369	)		(527	)
Net lease cost	$	3,466		$	3,119

As the Company elected not to separate lease and non-lease components, the variable lease cost primarily represents variable payment such as common area maintenance and copier expense. The Company does not have any material sub-lease agreements. Cash paid for amounts included in the measurement of lease liabilities was (in thousands):


	2022		2021
Operating cash flows from operating leases	$	3,061	$	2,872