District of Columbia Water and Sewer Authority Act of 1996

District of Columbia Water and Sewer Authority Act of 1996 - Amends the District of Columbia Self-Government and Governmental Reorganization Act to authorize the District of Columbia Council to issue revenue bonds, notes, and other obligations to borrow money to finance water and sewer facilities (defined as facilities for the obtaining, treatment, storage, and distribution of water, the collection, storage, treatment, and transportation of wastewater, storm drainage, and the disposal of liquids and solids resulting from treatment).

Allows water and sewer enterprise fund revenues, assets, or other property to be used as payments and security for obligations issued with respect to water and sewer facilities.

Permits the D.C. Council to delegate to the District of Columbia Water and Sewer Authority the authority to issue obligations to finance utilities facilities, pollution control facilities, and water and sewer facilities. Provides that such obligations issued by the Authority shall be issued by resolution of the Authority and not by an act of the Council.

Makes provisions requiring congressional approval before amounts may be obligated or expended by District government employees or officers inapplicable with respect to any amount obligated or expended: (1) from the proceeds of the sale of such obligations; (2) for the payment of the principal of, interest on, or any premium for such obligations; (3) to secure such obligations; and (4) for repair, maintenance, and capital improvements to facilities financed by such obligations.

Removes from the calculation of the District's debt service ceiling: (1) revenues, charges, or fees dedicated for the purposes of water and sewer facilities; and (2) obligations incurred pursuant to general obligation bonds issued before FY 1997 for the financing of Department of Public Works, Water and Sewer Utility Administration capital projects.

Requires: (1) the Authority to submit to the Mayor for inclusion in the annual budget annual estimates of the expenditures and appropriations necessary for its operation for the year; and (2) the Mayor, without revision but subject to recommendations, to forward the estimates to the Council for its action. Permits the Council to comment or make recommendations concerning, but not revise, such annual estimates.

Prohibits the Mayor from reducing amounts appropriated or otherwise made available to the Authority if determined necessary to reduce the District's budget in a fiscal year.

Requires employees transferred from the Department of Public Works to the Authority to perform their duties under the personnel system developed by the Authority's Board or a collective bargaining agreement entered into after the enactment of such Act.