Understanding State Social Security Fees
As the official State Social Security Administrator (SSSA), we're primarily responsible for administering Section 218 Agreements between the Social Security Administration (SSA) and state and local government employers that choose to provide Social Security benefits to their employees.
We're also responsible for processing agreement modifications, providing education to employers about Social Security and Medicare coverage, and collecting and reporting employer and coverage information to the SSA through the Annual Information Request (AIR).
Annual Maintenance Fee
Since 1987, we've operated using interest earned from the Social Security and Medicare tax holding account. However, in 2019 the funds diminished and were no longer able to pay for expenses required to operate the SSSA program. As a result, the SSSA started collecting the Annual Maintenance Fee on July 1, 2019. The fees collected exceeded the amount needed to fund the 2019-20 fiscal year expenditures. Therefore, we didn't collect fees for the 2021-22 and 2022-23 fiscal years. We've reached the minimum fund threshold and will be assessing the Annual Maintenance Fee beginning July 1, 2024. We'll continue to monitor and review the fee annually.
The SSA doesn't provide any funding for the SSSA program. Additionally, per Government (Gov.) Code section 20176 of the Public Employees’ Retirement Law, we are prohibited from using any retirement funds to cover expenses not related to the cost of the administration of the retirement system. Gov. Code sections 22551 and 22552 authorize us to collect administrative and contracting fees.
There are two types of fees that may be assessed. The first is a contracting fee of $650 to establish a new, or amend an existing, Section 218 Agreement for Social Security and/or Medicare coverage. The second is the Annual Maintenance Fee for all employers that have an existing Section 218 Agreement. This fee is based on the number of employees currently employed with your agency. The Annual Maintenance Fee will be assessed using the criteria below. The invoice will be generated annually when the SSSA AIR is sent to your agency.
| Number of Employees | Fee |
|---|---|
| 1-4 | $50 |
| 5-9 | $70 |
| 10-19 | $80 |
| 20-49 | $110 |
| 50-99 | $130 |
| 100-249 | $270 |
| 250-499 | $400 |
| 500-999 | $530 |
| 1,000+ | $670 |
The fee(s) collected will be held in a distinct account and utilized to fund SSSA staff, resources, and expenses incurred to administer the program.
Payments can be submitted through the Electronic Funds Transfer (EFT) debit method, automated clearing house (ACH) method, by check, or online through the Electronic Payment Gateway. The EFT debit method is preferred and can be set up in myCalPERS at no additional charge. Refer to the myCalPERS Electronic Funds Transfer Student Guide (PDF) for instructions on setting up the EFT or ACH payment methods and making payments.
If you're submitting payments via check, attach the invoice and mail to:
California Public Employees’ Retirement System
Cash & Payment Processing/FRAS
P.O. Box 942703
Sacramento, CA 94229-2703
Agencies Affected
All state or local government public agencies and schools with a voluntary Section 218 Agreement are required to pay the fees. This includes state agencies, cities, counties, special districts, schools, colleges, and universities.
Key details:
- If your agency does not have a Section 218 Agreement in place, you won't receive an annual fee invoice.
- The Annual Maintenance Fee will be based on the total number of employees at the agency, not the number of employees covered by the Section 218 Agreement.
- The SSSA program isn't part of core pension and health benefit programs and is unrelated to other contracts with CalPERS. The fee is applicable regardless of whether a public agency has a contract with CalPERS for pension or health care benefits.
Contact Information
- Email:
- SSSA@calpers.ca.gov
- Phone:
- (916) 795-0810
- Mail:
-
CalPERS - State Social Security Administrator Program
P.O. Box 720720
Sacramento CA, 94229-0720