Controlled Group - 2 plans SH options

[Biz Develop Consultant BJF]

Maybe it's the lack of coffee but I'm lacking confidence in my answer...
We have a prospective client that is a controlled group and wants to set up separate Plans; they were hoping to avoid a SH option on Plan 2, which we advised is not permissible.  So I was thinking SH match (100% on 4%) for Plan 1 and for Plan 2 QACA match.  This provides SH benefits for both employers but a vesting schedule can be applied to Plan 2.  

Am I missing something...

[C. B. Zeller]

Would both plans pass coverage if tested separately? If so, then you can do whatever you want, including using a non-safe harbor design for plan 2.

If not, then you are out of luck. There is a rule that you cannot aggregate plans that use different methods of satisfying the ADP test, including different safe harbors.