KRS § 341.275 — KY Code / Title XXVII / Chapter 341 / Section 341.275
341.275 Financing benefits for nonprofit organizations
Status: in_force

341.275 Financing benefits for nonprofit organizations.

(1) For the purpose of this section, a nonprofit organization is an organization (or

group of organizations) described in Section 501(c)(3) of the United States

Internal Revenue Code which is exempt from income tax under Section 501(a)

of such code. For the purpose of this section, "cabinet" shall mean the

Education and Labor Cabinet and "secretary" shall mean the secretary of the

Education and Labor Cabinet.

(2) Any nonprofit organization which, pursuant to KRS 341.070(4), is, or becomes,

a subject employer shall pay contributions under the provisions of KRS

341.270, unless it elects, in accordance with this section, to pay to the cabinet

for the fund an amount equal to the amount of regular benefits and of one-half

(1/2) of the extended benefits paid to workers for weeks of unemployment that

is attributable to service in the employ of the nonprofit organization, performed

during the effective period of the election but only if the employer is the

worker's most recent employer. No employer shall be deemed to be the most

recent employer unless the eligible worker to whom benefits are payable shall

have worked for that employer in each of ten (10) weeks whether or not

consecutive.

(a) Any nonprofit organization which is, or becomes, a subject employer on

July 1, 1972, may elect to become liable for payments in lieu of

contributions for a period of not less than the remainder of 1972 and the

calendar year of 1973, provided it files with the cabinet a written notice of

its election within the thirty (30) day period immediately following such

date.

(b) Any nonprofit organization which becomes a subject employer after July

1, 1972, may elect to become liable for payments in lieu of contributions

for a period of not less than the period of subjectivity during the year in

which such subjectivity begins and the following calendar year by filing a

written notice of its election with the cabinet not later than thirty (30) days

immediately following the date of the determination of such subjectivity.

(c) Any nonprofit organization which makes an election in accordance with

paragraph (a) or (b) of this subsection will continue to be liable for

payments in lieu of contributions until it files with the secretary a written

notice terminating its election not later than thirty (30) days prior to the

beginning of the calendar year for which such termination shall first be

effective, except that liability for payments in lieu of contributions shall

continue thereafter with respect to wages paid prior to the effective date

of such termination.

(d) Any nonprofit organization which has been paying contributions under

this chapter for a period subsequent to July 1, 1972, may change to a

reimbursable basis by filing with the cabinet not later than thirty (30) days

prior to the beginning of any calendar year a written notice of election to

become liable for payments in lieu of contributions. Such election shall not

be terminable by such organization for that and the following year.

(e) The secretary may for good cause extend the period within which a notice

of election, or a notice of termination, must be filed and may permit an

election to be retroactive but not any earlier than with respect to benefits

paid after December 31, 1969.

(f) The secretary shall notify each nonprofit organization of any

determination which may be made of its status as an employer and of the

effective date of any election which it makes and of any termination of

such election. Such determinations shall be subject to appeal and review

in accordance with the provisions of KRS 341.430(2).

(3) Payments in lieu of contributions shall be made in accordance with the

provisions of this subsection.

(a) At the end of each calendar quarter or at the end of any other period as

determined by the secretary, the cabinet shall bill each nonprofit

organization (or group of such organizations) which has elected to make

payments in lieu of contributions for an amount equal to the full amount of

regular benefits plus one-half (1/2) of the amount of extended benefits

paid during such quarter plus any prior period adjustments, which are

attributable to service performed in covered employment in the employ of

such organization plus interest on the total amount billed at the average

rate of earnings in the unemployment insurance fund for the prior

calendar year. All interest collected under this subsection shall be

credited to the unemployment insurance fund.

(b) Payment of any bill rendered under paragraph (a) shall be made not later

than thirty (30) days after such bill was mailed to the last known address

of the nonprofit organization or was otherwise delivered to it, unless there

has been an application for review in accordance with paragraph (d) of

this subsection.

(c) Payments made by any nonprofit organization under the provisions of this

subsection shall not be deducted or deductible, in whole or in part, from

the remuneration of workers in the employ of the organization.

(d) The amount due specified in any bill from the secretary shall be

conclusive on the organization unless, not later than fifteen (15) days after

the bill was mailed to its last known address or otherwise delivered to it,

the organization files an appeal to the commission setting forth the

grounds for such appeal. Proceedings on appeal to the commission from

the amount of a bill rendered under this subsection shall be in accordance

with the provisions of KRS 341.430, and the decision of the commission

shall be subject to review under the provisions of KRS 341.460(1).

(e) Past-due payments of amounts in lieu of contributions shall be subject to

the same interest, penalties, collection service, and lien provisions that,

pursuant to KRS 341.300 to 341.310, apply to past-due contributions.

(4) (a) The secretary may, in accordance with regulations prescribed by the

cabinet, require any nonprofit organization that elects to become liable for

payments in lieu of contributions to deposit with the cabinet, within thirty

(30) days after the effective date of its election as a condition thereof,

money equal to two percent (2) of the organization's total wages paid

for employment as defined in KRS 341.050(1)(e) for the four (4) calendar

quarters immediately preceding the effective date of such election. If the

nonprofit organization did not pay wages in each of such four (4) calendar

quarters, the amount of the deposit shall be as determined by the

secretary.

(b) Money deposited in accordance with this subsection shall be retained by

the cabinet in an escrow account until all possible liability to the fund

under the election is terminated, at which time it shall be returned to the

organization, less any deductions as hereinafter provided. The cabinet

may deduct from the money deposited under this subsection by a

nonprofit organization to the extent necessary to satisfy any due and

unpaid payments in lieu of contributions and any applicable interest and

penalties provided for in subsection (3)(e) of this section. The secretary

shall require the organization within thirty (30) days following any

deduction from a money deposit under the provisions of this subsection to

deposit sufficient additional money to make whole the organization's

deposit at the prior level. The secretary may, at any time, review the

adequacy of the deposit made by any organization. If, as a result of such

review, he determines that an adjustment is necessary, he shall require

the organization to make additional deposit within thirty (30) days of

written notice of his determination or shall return to it such portion of the

deposit as he no longer considers necessary, whichever action is

appropriate.

(c) If any nonprofit organization fails to make a deposit, or to increase or

make whole the amount of a previously made deposit, as provided under

this subsection, the secretary may terminate such organization's election

to make payments in lieu of contributions and such termination shall

continue for not less than the remainder of that calendar year and the

following calendar year beginning with the quarter in which such

termination becomes effective; provided, that the secretary may extend

for good cause the applicable filing, deposit, or adjustment period by not

more than sixty (60) days.

(5) If any nonprofit organization is delinquent in making payments in lieu of

contributions as required under subsection (3) of this section, the secretary

may terminate such organization's election to make payments in lieu of

contributions as of the beginning of the next calendar year, and such

termination shall be effective for that and the next calendar year.

(6) Notwithstanding any other section of this chapter, no employing unit electing to

make payments in lieu of contributions under the provisions of this section shall

be entitled to relief of benefit charges.