Property and Equipment

12 Months Ended

Dec. 31, 2015

Property and Equipment

Property and Equipment

Note 6. Property and Equipment

Property and equipment consisted of the following (in thousands):

	Estimated
	Service Life	December 31,
	(years)	2015		2014
Land and improvements	—	$	54,633	$	40,170
Buildings and other leasehold improvements	10 - 45		619,614		460,662
Riverboat	25		39,027		39,023
Furniture, fixtures and equipment	3 - 15		229,798		193,448
Furniture, fixtures and equipment held under capital leases (Note 16)	3 - 15		4,199		3,592
Construction in progress			2,692		3,130
			949,963		740,025
Less—Accumulated depreciation and amortization			(324,547)		(283,886)
Property and equipment, net		$	625,416	$	456,139

Substantially all property and equipment is pledged as collateral under our long‑term debt (see Note 9).

Depreciation expense, including amortization expense on capital leases, was $51.0 million, $26.9 million and $17.0 million for the years ended December 31, 2015, 2014 and 2013, respectively. At December 31, 2015 and 2014, accumulated depreciation and amortization includes $3.3 million and $3.4million, respectively, related to assets acquired under capital leases.

During the year ended December 31, 2015, Mountaineer submitted $3.9 million for reimbursement from the West Virginia Racing Commission for capital expenditures of which $1.3million has been reimbursed in 2015. These reimbursement amounts were applied against the applicable acquisition costs, which resulted in corresponding adjustments to the basis of the capitalized fixed assets. These reimbursements, which are reflected within investing activities in our accompanying consolidated statement of cash flows, did not have a material impact on our consolidated financial statements. Future reimbursements from the West Virginia Racing Commission are subject to the availability of racing funds.

In addition to the racing funds discussed above, Mountaineer also participates in a modernization fund which provides for reimbursement from amounts paid to the West Virginia Lottery Commission of $1 for each $2 expended for certain qualifying capital expenditures having a useful life of more than three years and placed into service after July 1, 2011. Qualifying capital expenditures include the purchase of slot machines and related equipment to the extent such slot machines are retained by Mountaineer at its West Virginia location for not less than five years. Any unexpended balance from a given fiscal year will be available for one additional fiscal year, after which time the remaining unused balance carried forward will be forfeited. As of December 31, 2015, Mountaineer remains eligible for $3.0million under annual modernization fund grants that expire in varying dates through June 30, 2017. We can make no assurances Mountaineer will be able to make qualifying capital expenditures purchases sufficient to receive reimbursement of the available funds prior to their expiration nor that the modernization funds will continue to be available.