(K) PLANS FOR CERTAIN IRRIGATION AND DRAINAGE ENTITIES.

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)”. (b) Effective Date.—The amendments made by subsection (a) shall apply to years beginning after December 31, 1997.