In Bailey v. State of North Carolina, 348 N.C. 130, 140-41, 500 S.E.2d 54, 60 (1998), our Supreme Court recognized that the determination that a contractual relationship exists does not end the inquiry; "this Court must determine whether the tax exemption was a condition or term included in the retirement contract." Bailey, 348 N.C. at 146, 500 S.E.2d at 63; See also Robertson v. Kulongoski, 466 F.3d 1114, 1117 (9th Cir. 2006), cert. denied, 550 U.S. 935, 127 S. Ct. 2262, 167 L. Ed. 2d 1092 (2007) (stating that "'the first sub-inquiry is not whether any contractual relationship whatsoever exists between the parties, but whether there was a "contractual agreement regarding the specific . . . term allegedly at issue"' ). In Bailey, our Supreme Court held that the trial court's finding that the plaintiffs had a contractual right to the tax exemption at issue was supported by evidence of creation of various statutory tax exemptions by the legislature, the location of those provisions alongside the other statutorily created benefit terms instead of within the general income tax code, the frequency of governmental contract making, communication of the exemption by governmental agents in both written and oral form, use of the exemption as inducement for employment, mandatory participation, reduction of periodic wages by contribution amount (evidencing compensation), loss of interest for those not vesting, establishment of a set time period for vesting, and the reliance of employees upon retirement compensation in exchange for their services. Thus, it is clear the tax exemption was a term or condition of benefits of the Retirement Systems to which the plaintiffs have a contractual right. Bailey, 348 N.C. at 146, 500 S.E.2d at 63.