(a) Federal-State Agreement. The state agency, with the approval of the Governor, is hereby authorized, upon enactment of applicable federal law, to enter on behalf of the state into an agreement, or a modification or modifications thereof, with the federal agency, consistent with the terms and provisions of this act, for the purpose of extending the benefits of the federal old-age and survivors insurance system to employees of the state or any political subdivision thereof, or of any instrumentality of any one or more of the foregoing, with respect to services specified in such agreement, which constitute "employment" as defined in Section 122 of this title. Such agreement may contain such provisions relating to coverage, benefits, contributions, effective date, modification and termination of the agreement, administration, and other appropriate provisions as the state agency and federal agency shall agree upon, but, except as may be otherwise required by or under applicable federal law as to the services to be covered, such agreement or modification thereof shall provide in effect that:

(1) Benefits will be provided for employees whose services are covered by the agreement or modification thereof (and their dependents and survivors) on the same basis as though such services constituted employment within the meaning of Title II of the Social Security Act.

(2) The state will pay to the federal agency, at such time or times as may be prescribed by the applicable federal law or by regulations of the federal agency, contributions with respect to wages (as defined in Section 122 of this title), equal to the sum of the taxes which would be imposed by the Federal Insurance Contributions Act if the services covered by the agreement or modification thereof constituted employment within the meaning of that Act.

(3) Such agreement or modification thereof shall be effective with respect to services performed after a date specified therein but shall in no event cover (A), in the case of state employees, any service performed prior to the beginning of the first calendar month after the date on which such agreement or modification thereof is entered into, or (B), in the case of employees of a political subdivision or of an instrumentality of either the state or a political subdivision, any service performed prior to the beginning of the first calendar month after the approval of the plan submitted under Section 125, except that a modification entered into after December 31, 1954, may be effective with respect to services performed after December 31, 1954, or after a later date specified in such modification.

(4) All services which constitute employment as defined in Section 122 and are performed in the employ of the state by employees of the state shall be covered by the agreement or modification thereof.

(5) All services which (A) constitute employment as defined in Section 122, (B) are performed in the employ of a political subdivision or in the employ of an instrumentality of either the state or a political subdivision, and (C) are covered by a plan which is in conformity with the terms of the agreement or modification thereof and has been approved by the state agency under Section 125 shall be covered by the agreement or modification thereof.

(6) As modified, the agreement shall include all services described in either paragraph (4) or paragraph (5) of this subsection and performed by individuals to whom Section 218(d) (3) (C) of the Social Security Act is applicable, and shall provide that the service of any such individual shall continue to be covered by the agreement in case he thereafter becomes eligible to be a member of a retirement system.

(b) Interstate Agreements. The state agency is hereby authorized to enter on behalf of the state into an agreement, consistent to the extent practicable with the terms and provisions of subsection (a) and other provisions of this act, with the appropriate agency or agencies of any other state or states and with the federal agency, whereby the benefits of the federal old-age and survivors insurance system shall be extended to employees of any instrumentality jointly created by this state and such other state or states.

(c) Retirement System as Separate Systems. Pursuant to Section 218(d)(6) of the Social Security Act, the Teachers' Retirement System shall, for the purposes of this act, be deemed to constitute a separate retirement system with respect to the state and a separate retirement system with respect to each political subdivision having positions covered thereby.

Added by Laws 1949, p. 376, § 3, emerg. eff. June 1, 1949. Amended by Laws 1953, p. 219, § 1, emerg. eff. June 8, 1953; Laws 1955, p. 278, § 3, emerg. eff. June 6, 1955.