(a) Determination.--If a city has entered into an agreement with the Commonwealth to place its employees under the Social Security Act (49 Stat. 620, 42 U.S.C § 301 et seq.), the board shall appoint an actuary and may fix the employee's compensation. The actuary shall determine the present value of the liability on account of pensions payable under the provisions of section 14343 (relating to retirement allowance, proof of disability and joint and single coverage members defined) to employees who are members of the system on the effective date of the agreement and shall offset the value of any assets in the fund to determine the unfunded liability. The city may make payments toward the unfunded liability until the accumulated reserve equals the present value of the liability. The actuary shall also determine the amount which shall be contributed annually into the fund on account of service of all new and original members subsequent to the effective date of the agreement.

(b) Contribution.--Employees shall pay into the board, monthly, an amount equal to 3.5% of that portion of monthly compensation on which Social Security allowances are payable and 5% of any monthly compensation in excess of that on which Social Security allowances are payable. The remainder of the needed annual contribution for service subsequent to the date of the agreement, as determined by the actuary, shall become the obligation of the city and shall be paid by it to the board by annual appropriations. The provisions of this section shall, in all applicable cases, supersede the provisions relating to contributions in sections 14344 (relating to amount of payments into fund and repayment before retirement) and 14348 (relating to appropriations and contributions to fund).