5 1 the net effective interest expense incurred by the District on 2 account of its obligations and the net effective interest ex3 pense which the District would have incurred had the in4 terest rate on its obligations been equal to the interest rate 5 on purchases by the Secretary pursuant to section 4, which6 ever is greater. 7 (b) The Commissioner shall, prior to making any re8 quest of the Secretary as authorized by subsection (a), 9 advise him as to the net effective interest expense which the 10 District expects to incur with respect to the proposed issue 11 of its obligations. The Secretary shall, on the basis of such 12 advice from the Commissioner, determine whether to pay to 13 the District the periodic amounts determined as specified in 14 clauses (1) or (2) of subsection (a), or, in the alternative, 15 to purchase from the District all or part of the proposed issue 16 of its obligations as authorized in section 4. 17 18 INTERIM LOAN AUTHORITY SEC. 6. (a) The Commissioner is authorized to accept 19 loans for the District from the United States Treasury, and 20 the Secretary is authorized to lend to the Commissioner, such 21 sums as the Commissioner may determine are required to 22 complete payments on capital outlay contracts which have 23 been awarded not later than ninety days after the enactment 24 of this Act. In addition, such loans shall include funds to 6 1 pay the District's share of the cost of the Adopted Regional 2 System specified in the National Capital Transportation 4 3 Act of 1969 through the fiscal year ending June 30, 1971. (b) In addition to the loan authority contained in sub5 section (a), the Commissioner is authorized to accept loans 6 for the District from the Treasury, and the Secretary is 7 authorized to lend to the Commissioner, such sums as the 8 Commissioner from time to time determines are necessary 9 10 to provide for the continuation of work on any capital pro gram project or projects, pending the sale of an issue of 11 District obligations. Any such loan shall be for such term 12 13 as may be agreed upon by the Commissioner and the Secre tary, but in no event shall the term of any such loan extend 14 for more than thirty days beyond the date on which proceeds 15 from the sale of the District's obligations become available 16 for the construction of such project or projects. 17 (c) Loans advanced pursuant to this section during any 18 six-month period shall be at a rate of interest determined 19 by the Secretary as of the beginning of such period, which, 20 in his judgment, would reflect the cost of money to the Treasury for borrowing at a maturity approximately equal to 22 the period of time the loan is outstanding. 23 24 (d) There are authorized to be appropriated such sums as may be necessary to make loans under this section. 1 2 7 DISTRICT OBLIGATIONS SUBJECT TO TAXATION SEC. 7. Notwithstanding the provisions of section 103 3 of the Internal Revenue Code (26 U.S.C. 103), any and all 4 obligations issued by the District under the authority of this 5 Act shall be subject both as to principal and interest to Dis6 trict, Federal, State, and local taxation to the same extent as the obligations of private corporations are taxed. 7 8 9 10 14 DISTRICT OBLIGATIONS AS LAWFUL INVESTMENTS, ACCEPTANCE AS SECURITY SEC. 8. All obligation issued by the District under the 11 authority of this Act shall be lawful investments, and may 12 be accepted as security for fiduciary, trust, and public funds, 13 the investment or deposit of which shall be under authority or control of the United States or of any officer or officers 15 thereof. All obligations issued by the District pursuant to 16 this Act shall be deemed to be exempt securities within the 17 meaning of laws administered by the Securities and Ex18 change Commission, to the same extent as securities which 19 are issued by the United States. 20 21 DISTRICT OBLIGATIONS ELIGIBLE FOR PURCHASE BY FINANCIAL INSTITUTIONS SEC. 9. (a) The sixth sentence of the seventh paragraph 23 of section 5136 of the Revised Statutes, as amended (12 24 U.S.C. 24), is amended by inserting ", or obligations of the. 1 District of Columbia issued pursuant to the District of Co2 lumbia Capital Program Financing Act of 1970," immedi3 ately following "United States" where such term first appears 4 in such sixth sentence. 5 (b) Notwithstanding any other provision of law, any 6 building association or building and loan association or any 7 savings and loan association, incorporated or unincorporated, 8 organized and operating under the laws of the District, or 9 any Federal savings and loan association, may invest its 10 funds in obligations of the District issued pursuant to this 11 Act. 12 13 14 PERMANENT APPROPRIATION FOR FEDERAL PAYMENT OF NET EFFECTIVE INTEREST EXPENSE SEC. 10. Section 3689 of the Revised Statutes, as 15 amended (31 U.S.C. 711), is further amended by adding 16 a new paragraph appropriating moneys for the purposes 17 under the Treasury Department, to read as follows: 18 "PAYMENTS WITH RESPECT TO DISTRICT OF COLUM 19 BIA OBLIGATIONS.-For payments with respect to obliga20 tions of the District of Columbia pursuant to section 5 (a) 21 of the District of Columbia Capital Program Financing Act 22 of 1970." 24 222 23 WATER POLLUTION SEC. 11. (a) The Commissioner shall annually esti 25 mate the amount of the District's principal and interest ex 9 1 pense which is required to service District obligations attrib2 utable to the Maryland and Virginia pro rata share of Dis3 trict sanitary sewage works and other water pollution proj4 ects which provide service to the local jurisdictions in those 5 States. Such amounts as determined by the Commissioner 6 shall be used to exclude the Maryland and Virginia share of 7 pollution projects costs from the limitation on the District's 8 capital program obligations as provided in section 3 (a). 9 (b) The Commissioner shall enter into agreements with 10 the States and local jurisdictions concerned for annual pay11 ments to the District of rates and charges for waste treatment services in accordance with the use and benefits made 13 and derived from the operation of the said waste treatment 14 facilities. Each such agreement shall require that the esti15 mated amount of such rates and charges will be paid in advance, subject to adjustment after each year. Such rates and charges shall be sufficient to cover the cost of construction, 18 interest on capital, operation and maintenance, and the neces19 sary replacement of equipment during the useful life of the 20 facility. 16 21 FUNDS FOR DISTRICT INSTITUTIONS OF HIGHER EDUCATION 22 23 22 * SEC. 12. (a) In order to carry out the District's capital programs for its institutions of higher education, including 24 those programs authorized by the District of Columbia Pub25 lic Education Act approved November 7, 1966 (Public Law |