It seems they are confusing Employee, Statutory Employee, and Independent Contractor. I know who would be able to address this (other than the SSA, of course): A Local Government Entity-qualified auditor, to be found on the State's qualified-approved list. That's who I learn these things from. Or, the State's Social Security Administrator.

Pub 963:

"If a position is covered by a Section 218 Agreement, then anyone holding that position is an employee. Therefore, the first question for a government to ask about a worker’s status is whether the worker is in a position covered under a Section 218 Agreement. If Section 218 Agreement coverage applies, this fact takes precedence over other considerations, including the common law tests discussed below and the mandatory coverage rules."

Employees would not be subject to SE, obviously. But, to argue you are fee-based, is to argue against your own argument that you are not subject to SE taxes.

"Services in positions compensated solely by fees are excluded from coverage under Section 218 Agreements (unless the State specifically included these services) and are covered as self-employment and subject to SECA. "

"A fee-based public official is an individual who receives and retains remuneration directly from the public. An individual who receives payment for services from government funds in the form of a wage or salary is not a fee-based public official, even if the compensation is called a fee."

https://secure.ssa.gov/poms.nsf/lnx/1960001625

The person is not paid by the public (fee based); fee based is unusual, because it can be leveraged. Being paid because of and based on how much you collect is not Paid by the Public. The money is turned over, and there is a Commission, essentially. Is the County/Court paying the person? Did they contract for this or do an intake form?

The taxpayer should know their worker status. This County/Court District can be doing it wrong, of course. If the taxpayer had to bid on the work, and is at risk of losing this contract for services, that would make them independent contractors.

Read Pub 963.

Pub 15-A covers Statutory Employee for FICA.

Social security and Medicare taxes.

You must withhold social security and Medicare taxes from the wages of statutory employees if all three of the following conditions apply.