PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

6. Premises, Equipment and Leasehold Improvements

Premises, equipment and leasehold improvements are summarized in the table below.

	December 31, 2018			December 31, 2017
Bank buildings	$	1,861,237		$	1,824,613
Land		838,075			838,075
Leasehold purchases		30,000			30,000
Leasehold improvements		709,520			690,212
Construction in progress		120,849			11,754
Equipment		3,526,404			3,405,686
		7,086,085			6,800,340
Accumulated depreciation		(4,750,878	)		(4,555,815	)
Total	$	2,335,207		$	2,244,525

Depreciation and amortization on our bank premises and equipment charged to operating expense totaled $195,063 in 2018, $193,298 in 2017, and $189,188 in 2016.

We entered into agreements to lease parking and office facilities under non-cancellable operating lease agreements expiring on various dates through 2039. We may, at our option, extend the lease of our Summerville office at 100 North Main Street for two additional ten-year periods; as well as extend the land lease where our Mt. Pleasant office is located for five additional five-year periods.

We rent office space at 1071 Morrison Drive, Charleston, South Carolina, from a related party, to house our Mortgage Department. Rent expense for this lease was $60,840, $54,720, and $51,690 for the years ended December 31, 2018, 2017, and 2016, respectively. This lease expires June 30, 2019.

We own the land and improvements at our West Ashley office located at 2027 Sam Rittenberg Boulevard, Charleston, South Carolina.

Management intends to exercise its option on all lease agreements. Lease payments below include the lease renewals. Minimum rental commitments for these leases as of December 31, 2018 are presented in the table below.

2019	$	619,492
2020		589,492
2021		589,492
2022		589,492
2023 and thereafter		8,603,721
Total	$	10,991,689

Total rental expense was $622,396, $612,717, and $594,567 in 2018, 2017 and 2016, respectively.

On January 28, 2014, we signed a lease to open a banking office located on Highway 78, North Charleston, South Carolina (copy of the lease incorporated as Exhibit 10.8 in the 2013 10-K and copy of the Assignment and Assumption of Lease incorporated as Exhibit 10.9, First Amendment to the Lease incorporated as Exhibit 10.10 and Second Amendment to the Lease incorporated as Exhibit 10.11 in the 2015 10-K). The original lease agreement was terminated but a new lease agreement was executed on July 31, 2017 for the same location (copy of lease incorporated as Exhibit 10.13 in the June 30, 2017 10Q). The building is expected to be completed in the second half of 2019. Rental payments do not commence until we take control of our space. As of December 31, 2018, we have spent $120,849 towards the construction of this office.