Premises and Equipment
 12 Months Ended
Dec. 31, 2014
Property, Plant and Equipment [Abstract]  
Premises and Equipment
Premises and Equipment

Details of premises and equipment, at cost, at December 31, were as follows:
 
2014
 
2013
Land and land improvements
$
3,046

 
$
3,019

Buildings and leasehold improvements
29,984

 
29,772

Furniture, fixtures and equipment
19,950

 
19,792

Total cost
52,980

 
52,583

Accumulated depreciation and amortization
(29,094
)
 
(26,856
)
Net premises and equipment
$
23,886

 
$
25,727



Depreciation and amortization expense on premises and equipment for the years ended December 31, 2014, 2013 and 2012 was $2.7 million, $2.7 million and $2.2 million, respectively. At December 31, 2014 and 2013, the Company has capitalized software costs of $3.6 million and $3.2 million, respectively, and related accumulated depreciation expense of $3.0 million and $2.7 million, respectively. Capitalized software costs are presented within other assets on the consolidated statement of condition. Depreciation and amortization expense on capitalized software costs for the years ended December 31, 2014, 2013, and 2012 were $335,000, $296,000, and $301,000, respectively.

Lease expense, primarily associated with the lease of the Company's office buildings and branch facilities, for the years ended December 31, 2014, 2013 and 2012 was $1.2 million, $1.3 million and $997,000, respectively. The Company has one capital lease for a branch facility with payments that extend until 2026 at an interest rate of 9.75% per year. The capital lease, recorded in premises and equipment, has a cost basis of $855,000 at December 31, 2014 and 2013 and accumulated depreciation of $373,000 and $331,000 at December 31, 2014 and 2013, respectively.

At December 31, 2014, under current operating and capital lease contracts, the Company had the following schedule of future minimum lease payments:
 
Operating
 
Capital
2015
$
1,274

 
$
129

2016
1,198

 
127

2017
956

 
126

2018
714

 
126

2019
632

 
126

Thereafter
1,824

 
812

Total minimum lease payments
$
6,598

 
$
1,446

Less: amount representing interest(1)
 
 
462

Present value of net minimum lease payments(2)
 
 
$
984


(1) Amount necessary to reduce net minimum lease payments to present value calculated at the Company's incremental borrowing rate at lease inception.
(2) Reflects the liability reported within other borrowed funds on the consolidated statements of condition. At December 31, 2014 and 2013, the capital lease liability was $984,000 and $1.0 million, respectively.

During 2012, the Company recorded a gain of $479,000 on the sale of a branch facility and is presented within non-interest income on the consolidated statements of income. There were no recorded gains or losses from the sale of premises or equipment for the years ended December 31, 2014 and 2013.