at time zone question in pl/pgSQL

Using postgresql version 7.1

I'm trying to write a simple pl/pgsql function that will return the current time for the given time zone ( i have to deal multiple time zones) . But I don't seem to be using the appropriate syntax. I keep getting an error on the 'at time zone...'

DECLARE
new_time TIMESTAMP;

BEGIN
SELECT INTO new_time now() at time zone 'PST'; /*just hard coding the time zone for now */

return new_time;

END;

The following select statement works from an SQL query:

SELECT now() at time zone 'PST'

and returns the appropriate time.

I have also tried using the following statements:

Set TimeZone to PST;
return now();

but that didn't give me the time for PST, only the default time zone, EST.

thanks in advance,

--heather grace