Ill STAT. 1072 PUBLIC LAW 105-34—AUG. 5, 1997 29 USC 1107 (b) EFFECTIVE DATE.— The amendments made by this section •^ot^- shall apply to elective deferrals for plan years beginning after December 31, 1998. SEC. 1525. SECTION 401 (K) PLANS FOR CERTAIN IRRIGATION AND DRAINAGE ENTITIES. (a) IN GENERAL. —Subparagraph (B) of section 401(k)(7) (relating to rural cooperative plan) is amended— (1) by striking "and" at the end of clause (iii), by redesignating clause (iv) as clause (v), and by inserting after clause (iii) the following new clause: "(iv) any organization which— "(I) is a mutual irrigation or ditch company described in section 501(c)(12) (without regard to the 85 percent requirement thereof), or "(II) is a district organized under the laws of a State as a municipal corporation for the purpose of irrigation, water conservation, or drainage, and", and (2) in clause (v), as so redesignated, by striking "or (iii)" and inserting ", (iii), or (iv)". 26 USC 401 note. (b) EFFECTIVE DATE. —The amendments made by subsection (a) shall apply to years beginning after December 31, 1997. SEC. 1526. PORTABILITY OF PERMISSIVE SERVICE CREDIT UNDER GOVERNMENTAL PENSION PLANS. (a) IN GENERAL.—Section 415 (relating to limitations on benefits and contributions under qualified plans) is amended by adding at the end the following new subsection: "(n) SPECIAL RULES RELATING TO PURCHASE OF PERMISSIVE SERVICE CREDIT. — "(1) IN GENERAL. — I f an employee makes 1 or more contributions to a defined benefit governmental plan (within the meaning of section 414(d)) to purchase permissive service credit under such plan, then the requirements of this section shall be treated as met only if— "(A) the requirements of subsection (b) are met, determined by treating the accrued benefit derived from all such contributions as an annual benefit for purposes of subsection (b), or "(B) the requirements of subsection (c) are met, determined iDy treating all such contributions as annual additions for purposes of subsection (c). "(2) APPLICATION OF LIMIT. —For purposes of— "(A) applying paragraph (1)(A), the plan shall not fail to meet the reduced limit under subsection (b)(2)(C) solely by reason of this subsection, and "(B) applying paragraph (1)(B), the plan shall not fail to meet the percentage limitation under subsection (c)(1)(B) solely by reason of this subsection. "(3) PERMISSIVE SERVICE CREDIT.— For purposes of this subsection— "(A) IN GENERAL.—The term 'permissive service credit' mesins service credit— "(i) recognized by the governmental plan for purposes of calculating a participant's benefit under the plan.
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