{"data":{"id":"us-ky/krs-341.277","jurisdiction":"us-ky","citation":"KRS 341.277","heading":"Financing benefits for employees of governmental entities.","body":"(1) Any governmental entity which, pursuant to KRS 341.070(3), is or becomes a\nsubject employer shall pay contributions under the provisions of KRS 341.270,\nunless it elects, in accordance with this section, to pay the cabinet for the fund an\namount equal to the amount of all regular benefits plus all extended benefits paid to\nworkers for compensable weeks of unemployment occurring on or after January 1,\n1979, and for all regular benefits and one -half (1/2) of extended benefits paid to\nworkers for compensable w eeks of unemployment occurring prior to such date that\nis attributable to service performed in covered employment in the employ of such\ngovernmental entity during the effective period of such election but only if the\nemployer is the worker's most recent em ployer. No employer shall be deemed to be\nthe most recent employer unless the eligible worker to whom benefits are payable\nshall have worked for that employer in each of ten (10) weeks whether or not\nconsecutive.\n(a) Any governmental entity, which is or be comes a subject employer, may elect\nto become liable for payment in lieu of contributions for a period of not less\nthan the calendar year in which such subjectivity begins and for the following\ncalendar year provided it files with the cabinet a written not ice of its election\nwithin thirty (30) days immediately following the date of the determinations\nof such subjectivity; or\n(b) Any governmental entity which has paid contributions under the provisions of\nKRS 341.270 may change to a reimbursable basis by fil ing with the cabinet a\nwritten notice of its election not later than thirty (30) days prior to the\nbeginning of any calendar year to make payments in lieu of contributions for a\nperiod of not less than two (2) calendar years following the effective date of\nsuch election.\n(c) Any governmental entity which elects to make payments in lieu of\ncontributions, in accordance with paragraph (a) or (b) of this subsection, shall\ncontinue to be liable for payments in lieu of contributions until it files with the\nsecretary a written notice terminating its election not later than thirty (30) days\nprior to the beginning of the calendar year for which such termination shall\nbecome effective except that liability for payments in lieu of contributions\nshall continue thereafter with respect to wages paid prior to the effective date\nof such termination.\n(d) The secretary may for good cause extend the period within which a notice of\nelection must be filed and may permit the effective date of such election to be\nretroactive.\n(e) The secretary shall notify each governmental entity of any determination made\nas to its status as a subject employer, pursuant to KRS 341.070 and the\neffective date of any election or termination made pursuant to this subsection\nwhich determinations shall be subject to appeal and review in accordance with\nthe provisions of KRS 341.430(2).\n(2) Payment in lieu of contributions shall be made in accordance with the provisions of\nthis subsection.\n(a) At the end of each calendar quarter or at the end of any other period as\ndetermined by the secretary, the cabinet shall bill each governmental entity (or\ngroup of governmental entities) which has elected to make payments in lieu of\ncontributions an amount equal to all regular benefits and all extended benefits\npaid during such quarter for compensable weeks occurring on or after January\n1, 1979, plus any prior period adjustments which are attributable to service\nperformed in covered employment in the employ of such governmental entity\nplus interest on the total amount b illed at the average rate of earnings in the\nunemployment insurance fund for the prior calendar year. All interest\ncollected under this subsection shall be credited to the unemployment\ninsurance fund.\n(b) Payment of any bill rendered under paragraph (a) of  this subsection shall be\nmade not later than thirty (30) days after such bill was mailed to the last\nknown address of the governmental entity or was otherwise delivered to it,\nunless there has been an application for review in accordance with paragraph\n(d) of this subsection.\n(c) Payments made by any governmental entity under the provisions of this\nsubsection shall not be deducted or deductible, in whole or in part, from the\nremuneration of workers in the employ of the governmental entity.\n(d) The amount due specified in any bill from the secretary shall be conclusive on\nthe governmental entity unless, not later than fifteen (15) days after the bill\nwas mailed to its last known address or otherwise delivered to it, the\ngovernmental entity files an appeal to  the commission, setting forth the\ngrounds for such appeal. Proceedings on appeal to the commission from the\namount of a bill rendered under this subsection shall be in accordance with the\nprovisions of KRS 341.430 and the decision of the commission shall be\nsubject to review under the provisions of KRS 341.460(1).\n(e) Past-due payments of amounts in lieu of contributions shall be subject to the\nsame interest, penalties, and collection provisions that, pursuant to KRS\n341.300, apply to past due contributions.\n(3) (a) The secretary may, in accordance with regulations prescribed by the\ncommission, require any governmental entity that elects to become liable for\npayments in lieu of contributions to deposit with the cabinet within thirty (30)\ndays after the effective date of its election as a condition thereof, money equal\nto two percent (2%) of the governmental entity's total wages paid for\nemployment as defined in KRS 341.050(1)(d) for the four (4) calendar\nquarters immediately preceding the effective date of such election. If the entity\ndid not pay wages in each of such four (4) quarters, the amount of deposit, if\nrequired, shall be determined by the secretary.\n(b) Provided, however, that the amount of money required to be deposited under\nthis paragraph shall not exceed the amount for which any contributing\nemployer would be liable if subject to the maximum contribution rate\napplicable to the annual taxable payroll.\n(c) Money deposited in accordance with this subsection shall be retained by the\ncabinet in an escrow account until all possible liability to the fund under the\nelection is terminated, at which time it shall be returned to the governmental\nentity, less any deductions as hereinafter provided. The cabinet may deduct\nfrom the money deposited under this subsection by a governmental entity to\nthe extent necessary to satisfy any due and unpaid payments in lieu of\ncontributions and any applicable interest and penal ties provided for in\nparagraph (e) of subsection (3) of this section. The secretary shall require the\ngovernmental entity within thirty (30) days following any deduction from a\nmoney deposit under the provisions of this subsection to deposit sufficient\nadditional money to make whole the governmental entity's deposit at the prior\nlevel. The secretary may, at any time, review the adequacy of the deposit made\nby any governmental entity. If, as a result of such review, he determines that\nan adjustment is necess ary, he shall require the governmental entity to make\nan additional deposit within thirty (30) days of written notice of his\ndetermination or shall return to it such portion of the deposit as he no longer\nconsiders necessary, whichever action is appropriate.\n(d) If any governmental entity fails to make a deposit, or to increase or make\nwhole the amount of a previously made deposit, as provided under this\nsubsection, the secretary may terminate such governmental entity's election to\nmake payments in lieu of contributions and such termination shall continue\nfor not less than the remainder of that calendar year and the following\ncalendar year beginning with the quarter in which such termination becomes\neffective; provided, that the secretary may extend for good  cause the\napplicable filing, deposit or adjustment period by not more than sixty (60)\ndays.\n(4) If any governmental entity is delinquent in making payments in lieu of contributions\nas required under subsection (3) of this section, the secretary may termin ate such\ngovernmental entity's election to make payments in lieu of contributions as of the\nbeginning of the next calendar year, and such termination shall be effective for that\nand the next calendar year.\n(5) Notwithstanding any other section of this chap ter, no employing unit electing to\nmake payments in lieu of contributions under the provisions of this section shall be\nentitled to relief of benefit charges.","path":["KRS Chapter 341"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=32277","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:58:29Z","sha256":"3c19eda1ba3b4810841c76e734cb865419bdc19907f8d8d7cb3e705f4ccadc9c","source_id":"us-ky","stale":false,"prev":"us-ky/krs-341.275","next":"us-ky/krs-341.280"},"notice":"GroundRules: Original legal text. Not legal advice."}