Section 218 Agreement Referendum Procedure for
State and Local Governments
(whose employees are members of a retirement system)
The conducting of a referendum is a process that results in the provision of Social Security and Medicare coverage for employees who desire this coverage and vote “yes” in the referendum. The cost for this coverage is 6.2 percent for the employee and the employer, and 7.65 percent if the employee was hired prior to April 1, 1986, and not currently paying Medicare tax.
A request for a referendum is also a request to divide the employee retirement system into two parts (those who desire participation in the Social Security Program and those who do not desire participation in the Social Security Program). To obtain coverage under section 218 of the Social Security Act, there must be a retirement system.
If a political subdivision desires to obtain Social Security coverage for employees and does not currently have a section 218 Agreement with the Commonwealth of Pennsylvania, the governing body of the political subdivision must initiate the division procedures by adopting a Resolution to:
Request authorization to divide the entity’s retirement system(s) by conducting a divided vote referendum (sample of resolution attached);
Authorize the appropriate individual to execute an agreement pursuant to the referendum;
Establish within the Resolution the effective date of coverage; and
Acknowledge the applicable state and federal laws and regulations regarding employee withholdings, employer contributions and record keeping.
The request for a referendum must be submitted in writing to the State Social Security for Public Employees Administrator.
Social Security for Public Employees Bureau
Attn: State Administrator
Room 1424 L&I Building
Harrisburg, PA 17121
Upon authentication of your request, you will be mailed an official letter containing minimum conditions that must be met to cover employees who are participating in a retirement system.
- A vote must be held by written ballot.
- The opportunity to vote must be given to all individuals who are members of the retirement system when the vote is held.
- The employees who are members on the date of notice must be given not less than 90 days notice of the election.
To complete your request for a referendum, you will need to submit the following forms and data:
The Pennsylvania Department of Labor & Industry, Social Security for Public Employees Bureau is responsible for overseeing the referendum process. If you have questions, you may e-mail the SSPE State Administrator at email@example.com
or call (717) 783-8860.