Exhibit 99.1


FOR IMMEDIATE RELEASE
Date:    May 4, 2004
Contact: Patricia E. Hoch, Corporate Secretary
         (717) 920-5811    Fax: (717) 920-1683




                         COMMUNITY BANKS, INC. DECLARES
                          SECOND QUARTER CASH DIVIDEND


Harrisburg,  PA - Community Banks,  Inc.  (Listed on Nasdaq:  CMTY) The Board of
Directors of Community  Banks,  Inc., the parent company of Community Banks, has
declared a quarterly  cash  dividend of $.17 per share  payable  July 1, 2004 to
shareholders of record on June 16, 2004. This represents a 7% increase over last
year's  second  quarter  dividend  of $.159 per share  adjusted  for the  twenty
percent stock dividend paid in January, 2004 and the five percent stock dividend
paid in April, 2004.

Community  recently  reported earnings of $5.2 million or $.41 per share for the
quarter ended March 31, 2004.

Total assets at March 31, 2004 totaled $1.9 billion, increasing 10.0% from March
31, 2003.

Currently,  Community Banks,  Inc.'s banking subsidiary has 46 community banking
offices and nearly 100 ATMs throughout central and northeastern Pennsylvania and
northern  Maryland.  In addition to banking and  insurance  services,  Community
offers complete trust, investment and settlement services.

This press release  contains  "forward  looking"  information  as defined by the
Private  Securities  Litigation Reform Act of 1995, that is based on Community's
current  expectations,  estimates,  and  projections  about  future  events  and
financial  trends  affecting  the  financial  condition of its  business.  These
statements are not historical facts or guarantees of future performance, events,
or results.  Such  statements  involve  potential risks and  uncertainties  and,
accordingly,  actual  performance  results  may  differ  materially.   Community
undertakes  no  obligation  to  publicly   update  or  revise  forward   looking
information,  whether as a result of new, updated information,  future events or
otherwise.