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https://lawyerly.ph/laws/view/l4966
[Act No. 3255, (1925-12-03)](https://lawyerly.ph/laws/view/l4966)
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[ Act No. 3255, December 03, 1925 ]

AN ACT TO PROVIDE FOR THE ISSUE OF BONDS OF THE GOVERNMENT OF THE PHILIPPINE ISLANDS IN THE SUM OF ANOTHER THREE MILLION DOLLARS THE PROCEEDS OF THE SALE OF WHICH ARE TO BE USED FOR THE PURCHASE OF AN EQUIVALENT AMOUNT OF BONDS OF THE METROPOLITAN WATER DISTRICT

Be it enacted by the Senate and House of Representatives of the Philippines in Legislature assembled and  by the authority of the same:

SECTION  1. The Secretary of War is hereby authorized to issue in the name and behalf of the Government  of the Philippine Islands bonds  in the  amount of  another three million dollars the proceeds of the sale of which shall be used by said Government for the purchase of  an equivalent par amount of bonds of  the  Metropolitan Water District to  be issued for the  purpose  of  obtaining funds for the completion of the extension  of the water supply and  sewerage systems of said district.

The  bonds so authorized to be issued shall bear such date and be in such form as the Secretary  of War  may determine and shall bear such  rate of interest and run for such length .of time as may be determined by said official.

Both principal and interest shall be payable in gold coin of the United States at the Treasury of the United States and the interest shall be payable at such periods as the Secretary of War may determine.  Said bonds shall be issued at times and in amounts to be determined by  the Governor-General upon the recommendation of the  Secretary of Finance, and they may be coupon bonds or registered bonds, convertible, in the discretion of the Secretary of War,  into either form, and in the case of the issue or transfer of any registered bonds the same shall be registered in the Treasury of the United States.  These  bonds may be  issued in series bearing  different dates.

Said bonds shall be exempt from taxation by the Government of the Philippine Islands or by any political or municipal subdivisions thereof, or by the Government of the United States, or by any State or territory of the United States, or by any county, municipality, or other municipal subdivision of any State or territory of the United States, or by the District of Columbia, which fact shall be stated upon their face by virtue of section one of the Act of Congress approved February sixth, nineteen hundred and five, according to which Act, as well as in  accordance with the Act of Congress approved on August twenty-ninth, nineteen hundred and sixteen, as amended, and in accordance with this Act.  the said bonds are issued.

SEC. 2.  The Secretary of War is further authorized to sell said bonds upon such terms as in his judgment are most favorable to the Government of the Philippine Islands, and he shall deposit the proceeds of the sales thereof with the authorized depository or depositories  of the Government of the Philippine Islands in the United States, to the credit of the Treasurer of .the Philippine Islands.

SEC 3.  The proceeds of the sale of the bonds issued. by virtue of this Act are hereby appropriated for the purpose of purchasing bonds issued by the Metropolitan Water District under the provisions of Act Numbered Twenty-eight hundred and thirty-two, in addition to amount authorized by Act Numbered Thirty-two hundred and four, which bonds of the Metropolitan Water District, the provisions of existing law to the contrary notwithstanding, shall be sold at the same price, shall bear the same date, the same rate of interest, and shall run for the same period of time as the bonds issued by virtue of this Act.  The Treasurer of the Philippine Islands is hereby authorized to purchase said bonds of the Metropolitan Water District in  such amounts  and at such times as may be determined by the Secretary of  Finance with the approval of the Governor-General, and at the same rate at which the Secretary of War sold  the bonds issued by virtue of this Act.

SEC. 4.  A sinking fund is hereby created for the payment of the bonds issued under the provisions of this Act, in such a manner that the total amount thereof at each annual due date of the bond issue shall be equal to the total of an annuity of such a sum, for each million pesos of bonds outstanding, as with interest at the rate of three and one-half per centum per  annum shall be sufficient to retire said bonds at maturity.  Such sinking fund shall be under the custody of the Treasurer of the Philippine Islands, who shall invest the same, in such manner as  the Secretary of Finance may approve in accordance with the provisions of Act  Numbered Three thousand fourteen governing the investment of sinking funds, and shall charge all expenses incidental  to such investment, to the said  sinking  fund.

SEC. 5. A standing annual appropriation is hereby made out of the general funds in the Insular Treasury, not otherwise appropriated, of such sums as may be necessary to provide for the sinking fund created in the next preceding section hereof, for the interest on the bonds issued by virtue of this Act and for the expenses incidental to the investment of the sinking fund.  A further appropriation is hereby made out of any funds in the Insular Treasury, not otherwise appropriated,  of a sufficient sum to cover the expenses of the issue and .sale of the bonds issued by virtue of this Act: Provided, That the Metropolitan Water District shall  reimburse the Government  for such expenses  within thirty days after the receipt of a statement of the same from the Insular Treasurer.

SEC. 6. The Metropolitan Water District, in lieu of the establishment of a sinking fund for the  redemption of the bonds sold to the  Government of  the Philippine Islands under the provisions of this Act, shall  obligate itself to pay into the Treasury of  the Philippine Islands annually a sufficient sum of  money  to meet the net requirements of the sinking fund set forth  in section four of this Act, anything in the provisions of  Act  Numbered  Twenty-eight hundred and thirty-two  to the  contrary notwithstanding; and the  Insular Treasurer is hereby  authorized to  apply payments so  made, without further  appropriation, to meet the requirements of the sinking fund established in section four hereof: Provided, That if the Metropolitan  Water District  shall fail,  for any reason, to meet  promptly the net requirements of the sinking fund set forth in section four hereof or to pay the interest on its bonds purchased by the Government  of  the Philippine  Islands in accordance with the provisions of section three hereof, the Collector of Internal Revenue  and the treasurer of the City  of Manila, so far as the City of Manila is concerned, and the provincial treasurer of Rizal,  with respect to the municipalities  comprising the rest of the district, are hereby authorized and directed  thirty  days after  said  default to proceed to retain out of the revenues of the City of Manila  and of the municipalities  included in the district, that  may  come into  their possession as belonging to  said city  and  municipalities, the sum  necessary, as  may   be  determined  by the Insular Auditor, to meet any delinquencies in the sinking fund and interest requirements in this proviso above-mentioned and said officials  shall  deposit the  sums so  retained with the Insular Treasurer.

SEC. 7. This Act shall take effect upon its approval.

Approved,  December 3, 1925.

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