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Employee Benefit Plans

12 Months Ended

Dec. 31, 2015

Compensation and Retirement Disclosure [Abstract]

Employee Benefits Plan

Note 13 – Employee Benefit Plans

401(k) Plan:

The 401(k) plan allows employees to contribute to their individual accounts under the plan amounts up to the IRS maximum. Matching company contributions to the plan are discretionary. Expense for matching company contributions under the plan was $167,000, $140,000, and $91,000 in 2015, 2014, and 2013, respectively.

Employee Stock Ownership Plan:

Through December 31, 2015, employees participated in an Employee Stock Ownership Plan (“ESOP”). ChoiceOne could make discretionary contributions to the ESOP. Shares of ChoiceOne common stock were allocated to participants based on relative compensation earned and compensation expense was recorded when allocated. Dividends on allocated shares increased the participant accounts. Participants became fully vested upon completing six years of qualifying service. Participants received the shares at the end of employment. A participant could require stock received to be repurchased by ChoiceOne at any time. ChoiceOne did not contribute to the ESOP nor was any expense recorded in 2015, 2014, or 2013. Effective January 1, 2016, ChoiceOne terminated the ESOP and transferred shares held by the ESOP to the 401(k) plan.

Shares held by the ESOP as of December 31 were as follows:

(Dollars in thousands)			2015			2014			2013

Shares allocated to participants			5,355			5,355			5,355
Shares unallocated			—			—			—
Total shares of ChoiceOne stock held by ESOP			5,355			5,355			5,355


Fair value of allocated shares, subject to repurchase obligation, recorded in other liabilities		$	127		$	123		$	91

Post-retirement Benefits Plan:

ChoiceOne maintains an unfunded post-retirement health care plan, which permits employees (and their dependents) the ability to participate upon retirement from ChoiceOne. ChoiceOne does not pay any portion of the health care premiums charged to its retired participants. A liability has been accrued for the obligation under this plan. ChoiceOne incurred post-retirement benefit expense of $2,000 in 2015 and negative expense of $20,000 in 2014, and $11,000 in 2013. The post-retirement obligation liability was $127,000 as of December 31, 2015 and $149,000 as of December 31, 2014.

Deferred Compensation Plans:

A deferred director compensation plan covers former directors of VRB, which was acquired by ChoiceOne in 2006. Under the plan, ChoiceOne pays each former director the amount of director fees deferred plus interest at rates ranging from 5.50% to 5.84% over various periods as elected by each director. The payout periods range from one month to ten years beginning with the individual’s termination of service. A liability has been accrued for the obligation under this plan. ChoiceOne incurred deferred compensation plan expense of $12,000, $12,000, and $14,000 in 2015, 2014, and 2013, respectively. The deferred compensation liability was $173,000 as of December 31, 2015 and $203,000 as of December 31, 2014.

A supplemental executive retirement plan covers four former executive officers of VRB. Under the plan, ChoiceOne pays these individuals a specific amount of compensation plus interest at 7.50% over a 15-year period commencing upon early retirement age (as defined in the plan) or normal retirement age (as defined in the plan). A liability has been accrued for the obligation under this plan. The effective interest rate used for the accrual for the retirement liability is based on long-term interest rates. Flat long-term interest rates during 2015 caused a slight decrease in plan expense in 2015, while a decrease in long-term interest rates during 2014 caused an increase in plan expense in 2014. ChoiceOne incurred deferred compensation plan expense of $32,000 in 2015, negative expense of $42,000 in 2014 and expense of $1,000 in 2013. Liabilities related to the supplemental executive retirement plan of $618,000 and $664,000 were outstanding as of December 31, 2015 and December 31, 2014, respectively.