Premises and Equipment

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Premises and Equipment

7.  Premises and Equipment

The following summarizes premises and equipment at December 31, 2015 and 2014:

	2015		2014
Land	$	4,726	$	4,726
Premises and leasehold improvements		37,673		35,839
Furniture and equipment		25,517		24,137
Construction in process		7,017		3,506
		74,933		68,208
Less: accumulated depreciation		35,563		32,830
Premises and equipment, net	$	39,370	$	35,378

Depreciation on premises and equipment amounted to $2,756 in 2015, $2,659 in 2014, and $2,147 in 2013.

In 2015, the Corporation entered into a contractual commitment to construct a branch facility in Worthington, Ohio at a cost of $5,948. Construction has commenced with $2,006 of construction in process as of December 31, 2015. The project is expected to be completed by the end of the fourth quarter of 2016.

In 2014, the Corporation entered into a contractual commitment to remodel its main office facility in Clearfield, Pennsylvania at a cost of $9,935. Construction in the amount of $5,658 has been completed, and $4,277 was in process as of December 31, 2015. The project is expected to be completed by the end of the first quarter of 2016.

The Corporation is committed under nineteen noncancelable operating leases for facilities and thirteen noncancelable operating leases for vehicles with initial or remaining terms in excess of one year. The minimum annual rental commitments under these leases at December 31, 2015 are as follows:

2016	$	907
2017		692
2018		440
2019		356
2020		237
Thereafter		1,967
	$	4,599

Rental expense, net of rental income, charged to occupancy expense for 2015, 2014, and 2013 was $699, $736, and $490, respectively.

In December 2009, the Corporation entered into a sale-leaseback transaction for real estate used in the operations of one of its branch office locations. The lease term is seventeen years, with two automatic renewal terms of five years each. The Corporation sold the property for $1,200 but financed the entire sales amount. Because the buyer/lessor did not make an initial investment on the purchase of the real estate that is adequate to transfer the risks and rewards of ownership, the Corporation deferred the entire gain of $489 associated with this transaction, which is included in accrued interest payable and other liabilities in the accompanying consolidated balance sheet. The gain is being recognized over the term of the loan under the installment method, and the gain recognized was included in other income in the accompanying consolidated statements of income and comprehensive income and totaled $22, $19, and $17 in 2015, 2014, and 2013, respectively.

The minimum annual rental commitments under this sale-leaseback transaction at December 31, 2015 are as follows:

2016	$	105
2017		105
2018		105
2019		105
2020		105
Thereafter		630
	$	1,155