52-10 Public Employees Under Federal Social Security

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CHAPTER 52-10PUBLIC EMPLOYEES UNDER FEDERAL SOCIAL SECURITY52-10-01.Declaration of policy. In order to extend to employees of the state andpolitical subdivisions within the state, and to the dependents and survivors of such employees,<br>the basic protection accorded to others by the old-age and survivor insurance system embodied<br>in the Social Security Act [42 U.S.C. 301 et seq.], it is hereby declared the policy of the legislative<br>assembly, subject to the limitations of this chapter, that such steps be taken as to provide such<br>protection to employees of the state and political subdivisions within the state on as broad a<br>basis as is permitted under the Social Security Act [42 U.S.C. 301 et seq.]. It is the policy also of<br>the legislative assembly that the protection afforded employees in positions covered by a<br>retirement system on the date an agreement under this chapter is made applicable to service<br>performed in such positions, or receiving periodic benefits under such retirement system at such<br>time, will not be impaired as a result of making the agreement so applicable or as a result of<br>legislative enactment in anticipation thereof.52-10-02. Definitions. For the purposes of this chapter:1.&quot;Employee&quot; includes an officer of a state or political subdivision as well as all<br>persons employed in and by regulatory boards, commissions, or councils recognized<br>and established by the statutes of the state of North Dakota, except part-time<br>elected persons or persons hired on a fee basis, if excluded by the federal-state<br>agreement.2.&quot;Employer&quot; means the state of North Dakota, and all its political subdivisions, and all<br>of their departments and instrumentalities.3.&quot;Employment&quot; means any service performed by an employee in the employ of the<br>state, or any political subdivision thereof for such employer, except:a.Service which in the absence of an agreement entered into under this chapter<br>would constitute &quot;employment&quot; as defined in the Social Security Act; orb.Service which under the Social Security Act may not be included in an<br>agreement between the state and the secretary of health and human services.Service which under the Social Security Act may be included in an agreement only<br>upon certification by the governor in accordance with section 218(d)(3) of that<br>chapter [42 U.S.C. 418] must be included in the term &quot;employment&quot; if and when the<br>governor issues, with respect to such service, a certificate to the secretary of health<br>and human services pursuant to subsection 2 of section 52-10-07.4.&quot;Federal Insurance Contributions Act&quot; means subchapters A and B of chapter 21 of<br>the federal Internal Revenue Code of 1954 [26 U.S.C. 3101 et seq.], as such codes<br>have been or may be from time to time amended; and the term &quot;employees tax&quot;<br>means the tax imposed by section 3101 of the Internal Revenue Code of 1954 [26<br>U.S.C. 3101].5.&quot;Political subdivision&quot; includes an instrumentality of a state, of one or more of its<br>political subdivisions, or of a state and one or more of its political subdivisions, but<br>only if the instrumentality is a juristic entity which is legally separate and distinct from<br>the state or subdivision and only if its employees are not by virtue of their relation to<br>the juristic entity employees of the state or subdivisions.6.&quot;Secretary of health and human services&quot; includes any individual to whom the<br>secretary of health and human services has delegated any of the secretary's<br>functions under the Social Security Act with respect to coverage under such Act of<br>employees of states and their political subdivisions.Page No. 17.&quot;Social Security Act&quot; means the Act of the Congress approved August 14, 1935,<br>chapter 531 [49 Stat. 620; 42 U.S.C. 301 et seq.], officially cited as the &quot;Social<br>Security Act&quot;, including regulations and requirements pursuant thereto, as the Act<br>has been and may from time to time be amended.8.&quot;State agency&quot; means the job insurance division of job service North Dakota.9.&quot;Wages&quot; means all remuneration for employment as defined herein, including the<br>cash value of all remuneration paid in any medium other than cash, except that the<br>term does not include that part of such remuneration which, even if it were for<br>&quot;employment&quot; within the meaning of the Federal Insurance Contributions Act, would<br>not constitute &quot;wages&quot; within the meaning of that Act.52-10-03. Federal-state agreement - Interstate instrumentalities.1.The state agency, with the approval of the governor, is hereby authorized to enter on<br>behalf of the state into an agreement with the secretary of health and human<br>services consistent with the terms and provisions of this chapter, for the purpose of<br>extending the benefits of the federal old-age and survivors' insurance system to<br>employees of the state or any political subdivision with respect to services specified<br>in such agreement which constitute &quot;employment&quot; as defined in section 52-10-02.<br>The agreement may contain such provisions relating to coverage, benefits,<br>contributions, effective date, modification, and termination of the agreement,<br>administration, and other appropriate provisions as the state agency and the<br>secretary of health and human services shall agree upon, but, except as may be<br>otherwise required by or under the Social Security Act as to the services to be<br>covered, such agreement shall provide in effect that:a.Benefits will be provided for employees whose services are covered by the<br>agreement, and their dependents and survivors, on the same basis as though<br>such services constituted employment within the meaning of title II of the Social<br>Security Act [42 U.S.C. 401 et seq.].b.The state will pay to the secretary of the treasury, at such time or times as may<br>be prescribed under the Social Security Act, contributions with respect to<br>wages, as defined in section 52-10-02, equal to the sum of the taxes which<br>would be imposed by the Federal Insurance Contributions Act if the services<br>covered by the agreement constituted employment within the meaning of that<br>Act.c.The agreement shall be effective with respect to services in employment<br>covered by the agreement performed after a date specified therein but in no<br>event may it be effective with respect to any such services performed prior to<br>the last day of the sixth calendar year preceding the year in which the<br>agreement is entered into or in which the modification of the agreement making<br>it applicable to such services, is entered into, except that an agreement or<br>modification entered into after December 31, 1955, and prior to January 1,<br>1960, shall be effective with respect to services performed after December 31,<br>1955; or after a later date specified in such modification.d.All services, which constitute employment as defined in section 52-10-02 and<br>are performed in the employ of the state by employees of the state, shall be<br>covered by the agreement; all services which constitute employment as defined<br>in section 52-10-02 and are performed in the employ of any municipality except<br>elected officials, shall be covered by the agreement, notwithstanding the<br>provisions of section 52-10-05, which provides for plans for coverage of<br>employees.Page No. 2e.All services, which constitute employment as defined in section 52-10-02, are<br>performed in the employ of a political subdivision of the state, and are covered<br>by a plan which is in conformity with the terms of the agreement and has been<br>approved by the state agency under section 52-10-05, shall be covered by the<br>agreement.f.The agreement shall include all services described in either subdivision d or e<br>and performed by individuals to whom section 218(c)(3)(C) of the Social<br>Security Act [42 U.S.C. 418] is applicable, and shall provide that the service of<br>any such individual shall continue to be covered by the agreement in case the<br>individual thereafter becomes eligible to be a member of the retirement system.g.The agreement shall include all services described in either subdivision d or e<br>and performed by individuals in positions covered by a retirement system with<br>respect to which the governor has issued a certificate to the secretary of health<br>and human services pursuant to subsection 2 of section 52-10-07.2.Any instrumentality jointly created by this state and any other state or states is<br>hereby authorized, upon the granting of like authority by such other state or states:a.To enter into an agreement with the secretary of health and human services by<br>which the benefits of the federal old-age and survivors' insurance system shall<br>be extended to employees of such instrumentality;b.To require its employees to pay, and for that purpose to deduct from their<br>wages, contributions equal to the amounts which they would be required to pay<br>under subsection 1 of section 52-10-04 if they were covered by an agreement<br>made pursuant to subsection 1; andc.To make payments to the secretary of the treasury in accordance with such<br>agreement, including payments from its own funds, and otherwise to comply<br>with such agreements.Such agreement, shall, to the extent practicable, be consistent with the terms and<br>provisions of subsection 1 and other provisions of this chapter.52-10-03.1.Modification of federal-state agreement to exclude certain students.The state agency, with the approval of the governor, is hereby authorized to modify at any time<br>prior to January 1, 1974, the agreement of December 5, 1955, between the state and the<br>secretary of health, education, and welfare, whereby under section 218 [42 U.S.C. 418] the<br>insurance system established by the Social Security Act was extended to services performed by<br>individuals as employees of the state or any political subdivision thereof, to effect the exclusion of<br>service performed in the employ of a school, college, or university if such service is performed by<br>a student who is enrolled and is regularly attending classes at such school, college, or university.52-10-03.2. Authority of executive director - Social security coverage for nationalguard employees.The executive director of job service North Dakota may enter into anagreement with the federal security agency, social security administration bureau of old-age and<br>survivor insurance to provide coverage for national guard state civilian employees under the<br>old-age and survivor insurance provisions of the Social Security Act as provided in section 218 of<br>the Social Security Act amendments of 1950 [Pub. L. 81-734; 64 Stat. 514; 42 U.S.C. 418]. For<br>purposes of the agreement, the executive director may make such collections, contributions, and<br>reports as may be required by the federal agency under the terms of the agreement.52-10-04. Contributions by employees of the state and of political subdivisions.1.Every employee of the state or of a political subdivision and every employer is<br>required to pay for the period of such coverage, into the contribution fund<br>established by section 52-10-06, contributions, with respect to wages, as defined inPage No. 3section 52-10-02, equal to the amount of the tax which would be imposed by the<br>Federal Insurance Contributions Act if such services constituted employment within<br>the meaning of that Act. Such employee's liability shall arise in consideration of the<br>employee's retention in the service of the state or of a political subdivision or the<br>employee's entry upon such service, after the enactment of this chapter.2.The employee's contribution imposed by this section must be collected by deducting<br>the amount of the contribution from wages as and when paid, but failure to make<br>such deduction does not relieve the employee from liability for such contribution.3.If more or less than the correct amount of the contribution imposed by this section is<br>paid or deducted with respect to any remuneration, proper adjustments, or refund if<br>adjustment is impracticable, must be made, without interest, in such manner and at<br>such times as the state agency shall prescribe.4.All unexpended employer contributions in the social security contribution fund paid in<br>to provide a fund out of which the legislative assembly could appropriate for the<br>administration of this chapter and chapter 52-09 as of June 30, 1987, must be<br>transferred by the office of management and budget to the bureau for deposit by the<br>bureau into the old-age survivors' fund established by section 52-09-05.52-10-05. Plans for coverage of employees of political subdivisions.1.Each political subdivision of the state is hereby authorized to submit for approval by<br>the state agency a plan for extending the benefits of title II of the Social Security Act<br>[42 U.S.C. 401 et seq.], in conformity with applicable provisions of such Act, to<br>employees of such political subdivision.Each such plan and any amendmentthereof must be approved by the state agency if it finds that such plan, or such plan<br>as amended is in conformity with such requirements as are provided in regulations<br>of the state agency, except that no such plan may be approved unless:a.It is in conformity with the requirements of the Social Security Act and with the<br>agreement entered into under section 52-10-03;b.It provides that all services which constitute employment as defined in section<br>52-10-02 and are performed in the employ of the political subdivision by<br>employees thereof, shall be covered by the plan;c.It specifies the source or sources from which the funds necessary to make the<br>payments required by subdivision a of subsection 3 and by subsection 4 are<br>expected to be derived and contains a reasonable assurance that such sources<br>will be adequate for such purpose;d.It provides for such methods of administration of the plan by the political<br>subdivision as are found by the state agency to be necessary for the proper and<br>efficient administration of the plan;e.It provides that the political subdivision will make such reports, in such form and<br>containing such information, as the state agency may from time to time require,<br>and comply with such provisions as the state agency or the secretary of health<br>and human services may from time to time find necessary to assure the<br>correctness and verification of such reports; andf.It authorizes the state agency to terminate the plan in its entirety, in the<br>discretion of the state agency, if it finds that there has been a failure to comply<br>substantially with any provision contained in such plan, such termination to take<br>effect at the expiration of such notice and on such conditions as may be<br>provided by regulations of the state agency and may be consistent with the<br>provisions of the Social Security Act.Page No. 42.The state agency may not finally refuse to approve a plan submitted by a political<br>subdivision under subsection 1, and may not terminate an approved plan, without<br>reasonable notice and opportunity for hearing to the political subdivision affected<br>thereby.3.a.Each political subdivision as to which a plan has been approved under this<br>section shall pay into the social security contribution fund, with respect to<br>wages, as defined in section 52-10-02, at such time or times as the state<br>agency may by regulation prescribe, contributions in the amounts and at the<br>rates specified in the applicable agreement entered into by the state agency<br>under section 52-10-03.b.Each political subdivision required to make payments under subdivision a is<br>authorized, in consideration of the employee's retention in, or entry upon,<br>employment after enactment of this chapter, to impose upon each of its<br>employees, as to services which are covered by an approved plan, a<br>contribution with respect to the employee's wages, as defined in section<br>52-10-02, not exceeding the amount of employee tax which would be imposed<br>by the Federal Insurance Contributions Act if such services constituted<br>employment within the meaning of that Act, and to deduct the amount of such<br>contribution from the employee's wages as and when paid. Contributions so<br>collected must be paid into the social security contribution fund in partial<br>discharge of the liability of such political subdivision or instrumentality under<br>subdivision a.Failure to deduct such contribution does not relieve theemployee or employer of liability therefor.4.Delinquent payments due under subdivision a of subsection 3 must bear interest at<br>the rate specified in the Social Security Act at 42 U.S.C. 418 and may be recovered<br>by action in a court of competent jurisdiction against the political subdivision liable<br>therefor or may, at the request of the state agency, be deducted from any other<br>moneys payable to such subdivision by any department or agency of the state. In<br>no case may the interest imposed hereby be less than five dollars. In addition, a<br>penalty may be assessed on delinquent reports if such penalty is provided for in the<br>Social Security Act at 42 U.S.C. 418. Any such penalty must be under the terms,<br>conditions, and in the amounts specified in the Social Security Act. In no case may<br>any penalty imposed hereby be less than five dollars. Annually, on each September<br>thirtieth, the bureau shall determine the balance in the fund created by section<br>52-10-06 resulting from interest and penalties collected which are not or will not be<br>due to the secretary of the treasury.The bureau shall transfer this balance onSeptember thirtieth to the old-age survivors' fund created by section 52-09-05.5.a.When the state, or any political subdivision as defined in section 52-10-02, is<br>liable for an amount due under an agreement pursuant to this chapter, the<br>state, or such political subdivision shall remain so liable until the secretary of<br>health and human services is satisfied that the amount due has been paid to<br>the secretary of the treasury.b.Notwithstanding subdivision a, the state, or any political subdivision as defined<br>in section 52-10-02, is not liable for an amount due under an agreement<br>pursuant to this chapter, with respect to the wages paid to individuals, after the<br>expiration of the latest of the following periods:(1)Three years, three months, and fifteen days after the year in which such<br>wages were paid;(2)Three years after the date on which such amount became due; or(3)Three years, three months, and fifteen days after January 1, 1962,Page No. 5unless prior to the expiration of such period the secretary of health and human<br>services makes an assessment of the amount due from the state, or any<br>political subdivision.52-10-06. Social security contribution fund.1.There is hereby established a special fund to be known as the social security<br>contribution fund. Such fund must consist of and there must be deposited in such<br>fund:a.All contributions, interest, and penalties collected under sections 52-10-04 and<br>52-10-05;b.All moneys appropriated thereto under this chapter;c.Any property or securities and earnings thereof acquired through the use of<br>moneys belonging to the fund;d.Interest earned upon any moneys in the fund; ande.All sums recovered upon the bond of the custodian or otherwise for losses<br>sustained by the fund and all other moneys received from the fund from any<br>other source.All moneys in the fund must be mingled and undivided. Subject to the provisions of<br>this chapter, the state agency is vested with full power, authority, and jurisdiction<br>over the fund, including all moneys and property or securities belonging thereto, and<br>may perform any and all acts whether or not specifically designated, which are<br>necessary to the administration thereof and are consistent with the provisions of this<br>chapter.2.The social security contribution fund must be established and held separate and<br>apart from any other funds or moneys of the state and must be used and<br>administered exclusively for the purpose of this chapter. Withdrawals from such<br>fund must be made for, and solely for:a.Payment of amounts required to be paid to the secretary of the treasury<br>pursuant to an agreement entered into under section 52-10-03;b.Payment of refunds provided for in subsection 3 of section 52-10-04; andc.Refunds of overpayments, not otherwise adjustable, made by a political<br>subdivision or instrumentality.3.From the social security contribution fund the custodian of the fund shall pay to the<br>secretary of the treasury such amounts and at such time or times as may be<br>directed by the state agency in accordance with any agreement entered into under<br>section 52-10-03 and the Social Security Act.4.The treasurer of the state of North Dakota is ex officio treasurer and custodian of the<br>social security contribution fund and shall administer such fund in accordance with<br>the provisions of this chapter and the directions of the state agency.Alldisbursements from such fund except administrative expenses must be made in<br>accordance with such regulations as the state agency may prescribe.5.a.There are hereby authorized to be appropriated annually to the contribution<br>fund, in addition to the contributions collected and paid into the contribution<br>fund under sections 52-10-04 and 52-10-05, to be available for the purposes of<br>subsections 2 and 3 until expended, such additional sums as are found to bePage No. 6necessary in order to make the payments to the secretary of the treasury which<br>the state is obligated to make pursuant to an agreement entered into under<br>section 52-10-03.b.The state agency shall submit to each regular session of the legislative<br>assembly, at least ninety days in advance of the beginning of such session, an<br>estimate of the amounts authorized to be appropriated to the social security<br>contribution fund by subdivision a for the next appropriation period.52-10-07. Referenda and certification.1.With respect to employees of the state and political subdivisions who are under<br>chapter 52-09 or who may by election come under that chapter, the governor is<br>empowered to authorize a referendum, and with respect to the employees of any<br>political subdivision who are under a locally administered retirement system, the<br>governor shall authorize a referendum upon request of the governing body of such<br>subdivision; and with respect to employees covered by any other retirement system,<br>the governor may authorize a referendum; and in either case the referendum must<br>be conducted and the governor shall designate an agency or individual to supervise<br>its conduct, in accordance with the requirements of section 218(d)(3) of the Social<br>Security Act [42 U.S.C. 418], on the question of whether service in positions covered<br>by a retirement system established by the state or by a political subdivision thereof<br>should be excluded from or included under an agreement under this chapter. The<br>notice of referendum required by section 218(d)(3)(C) of the Social Security Act [42<br>U.S.C. 418] to be given to employees must contain or must be accompanied by a<br>statement, in such form and such detail as the agency or individual designated to<br>supervise the referendum shall deem necessary and sufficient, to inform the<br>employees of the rights which will accrue to them and their dependents and<br>survivors, and the liabilities to which they will be subject, if their services are included<br>under an agreement under this chapter.2.Upon receiving evidence satisfactory to the governor that with respect to any such<br>referendum the conditions specified in section 218(d)(3) of the Social Security Act<br>[42 U.S.C. 418] have been met, the governor, or an official designated by the<br>governor to act in the governor's behalf in respect to this subsection, shall so certify<br>to the secretary of health and human services.52-10-08. Rules and regulations. The state agency shall make and publish such rulesand regulations, not inconsistent with the provisions of this chapter, as it finds necessary or<br>appropriate to the efficient administration of the functions with which it is charged under this<br>chapter. Such regulations must require the employers to make such reports in such form and<br>containing such information as the state agency may from time to time request, and must require<br>employers to comply with such provisions as the state agency or the secretary of health and<br>human services may from time to time find necessary to assure the correctness and verification<br>of such reports.52-10-09. Studies and reports. The state agency shall submit a biennial report to thegovernor and the secretary of state in accordance with section 54-06-04.52-10-10. Identification of enlarged or reorganized public school district - Liabilityof surviving district.1.As used in this section, &quot;most populous district&quot; means the public school district<br>involved in annexation or reorganization of school districts:a.Which maintained an elementary school;b.More than one-half of which is included in the enlarged or reorganized public<br>school district; andPage No. 7c.Which had a larger number of children of school age at the school census next<br>preceding the inclusion of such district in the enlarged or reorganized public<br>school district than any other public school district of the type described in<br>subdivisions a and b which is included in the enlarged or reorganized public<br>school district.2.For the purposes of this chapter when an enlarged or reorganized school district is<br>formed:a.The most populous district must be deemed to be the surviving district for<br>social security purposes.b.The enlarged or reorganized public school district shall retain the same<br>identification number which was previously assigned to the most populous<br>district, as defined in subsection 1.c.The school districts, or parts thereof, included in the enlarged or reorganized<br>district must be deemed to be annexed to the most populous district, or the part<br>of the most populous district included in the enlarged or reorganized district,<br>and to become identified with it, and the employees of the public school districts<br>included in the enlarged or reorganized district, or if only part of a district is<br>included in the enlarged or reorganized district, the employees who were<br>employed in schools included within the enlarged or reorganized district must<br>be deemed to be employees of the most populous district, which shall succeed<br>the other districts in such enlarged district as a party to their respective<br>contracts of employment.52-10-11. Systems divided - Referendum on social security.1.Notwithstanding the provisions of sections 52-10-05 and 52-10-07, with respect to<br>the employees of any political subdivision who are under a locally administered<br>retirement system in existence prior to April 23, 1957, including the North Dakota<br>teachers' insurance and retirement fund for the purposes of this section, the<br>governor is empowered to authorize a referendum for a divided retirement system<br>as provided by section 218 of title II of the Social Security Act [42 U.S.C. 418]. The<br>system must be divided as follows:a.Group A of the divided retirement system must be composed of:(1)Persons, in positions covered in a locally administered retirement system<br>at the time the political subdivision submits the plan of coverage, who<br>have indicated in accordance with this section that they desire coverage<br>under an agreement under section 218 of title II of the federal Social<br>Security Act [42 U.S.C. 418]; and(2)Individuals, including former employees, who become employed in a<br>position covered by a local retirement system after April 23, 1957, and<br>inactive members who become employed in positions covered by a<br>locally administered retirement system after said date.b.Group B must be composed of all other persons who are employed in positions<br>covered by a local retirement system at the time referred to in paragraph 1 of<br>subdivision a.2.Each person who is an actively employed person in a position covered by a local<br>retirement system on the date the political subdivision makes application to the<br>governor for a referendum under this section shall indicate whether the person<br>desires to be a member of group A or group B on a form furnished for that purpose<br>by the state agency and deliver said form to the office of the state agency. AnPage No. 8employee who chooses to become a member of group A shall thereby elect to<br>become subject to the laws relating to group A. Each such employee shall enter the<br>employee's mailing address on such form. At the time the state agency certifies to<br>the governor that the plan of coverage required by section 52-10-05 meets the<br>requirements of the law, the state agency shall certify to the governor the names and<br>addresses of the employees of the political subdivision who have indicated their<br>desire to become members of group A.3.When the state agency has certified to the governor the names and addresses of<br>group A, the governor shall forthwith take all actions necessary for the conduct of a<br>referendum under section 52-10-07 so that members of group A may vote in favor of<br>or against coverage under the federal old-age and survivors' insurance system. If a<br>majority of the members of group A vote in favor of such coverage, the amendments<br>made and provisions created by this section shall be fully operative. If less than a<br>majority vote in favor of such coverage, such amendments and provisions do not<br>continue in effect and a retirement system must be deemed not to be divided into<br>group A and group B.4.Employees in positions covered by locally administered retirement plans who have<br>indicated their desire to become members of group B under this section may request<br>a transfer to group A, provided such request is in writing and received by the state<br>agency within the time limit specified in section 218 of title II of the Social Security<br>Act [42 U.S.C. 418].Page No. 9Document Outlinechapter 52-10 public employees under federal social security