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NORTH CAROLINA GENERAL STATUTE 128'30(bl) "(bl) Pick UP of EmPlOyee COntr~butions.~-Anything within this section to the contrary notwithstanding, effective July l, 1982, an employer, pursuant to the provisions of Section 414(h)(2) of the Internal Revenue Code of 1954 as amended, may elect to pick up and pay the contributions which would be payable by the employees as members under subsection (b) of this section with respect to the service of employees after June 30, 1982. The members' contributions picked up by an employer shall be designated for all purposes of the Retirement System as member contributions, except for the determination of tax upon a distribution from the System. These contributions shall be credited to the annuity savings fund and accumulated within the fund in a member's account which shall be Separately established for the purpose of accounting for picked-up contributions. Member contributions picked up by an employer shall be payable from the same source of funds used for tbe payment of compensation to a member. A deduction shall be made from a member's compensation equal to the amount of his contributions picked up by his employer. This deduction, however, shall not reduce his compensation as defined in subdivision (7a) of G~S. 128-21. Picked~up contributions shall be transmitted to the System monthly for the preceding month by means of a warrant drawn by the employer and payable to the Local Governmental Empioyees' Retirement System and shall be accompanied by a schedule of the picked-u? contributions on such forms as may be prescribed. In the case of a failure to fulfill these conditions the provisions of subsection (f)(3) of this section shall apply."