Thirty-four other States and the Commonwealth of Puerto Rico were approved to establish SIBs under an earlier SIB pilot program authorized by the National Highway System Designation Act of 1995. Under TEA-21, the USDOT was allowed to designate additional qualified states to participate in the SIB pilot program (the NHS Act SIB program was incorporated into the TEA-21 pilot). As shown in the figure below, 39 states, including Puerto Rico, have now established SIBs.

A SIB can provide many types of financial assistance, ranging from loans to credit enhancements. Forms of assistance may include interest subsidies, letters of credit, capital reserves for bond financing, construction loans, and purchase and lease agreements for highway and transit projects. Learn more about SIBs.

TEA-21 provided an additional $150 million to be distributed to the initial ten states and to any additional states designated for participation under the new legislation. This money was used to capitalize the SIBs and has been available to both highway and transit accounts of a designated state's SIB. In order to create a SIB, states must enact enabling legislation which designates how the SIB will be funded and how it will operate. There is a certain amount of flexibility to these terms and particular arrangements vary from state to state. The following parameters pertain:

• States may contribute Federal highway funds apportioned for major programs, such as Interstate Maintenance, National Highway System, Surface Transportation Program, and Bridge Construction and Rehabilitation programs to the SIB, as well as funds made available to the states or other Federal transit grant recipient under Title 49.
  
• To receive the Federal pilot program seed money available for the transit account of the SIB, the state must provide a match equal to 25 percent of the Federal funds. These matching state funds will allow the department to capitalize the transit account of the SIB.
  
• SIBS must be capitalized in five years, with 20 percent received in each year.
  
• Capitalized funds may be deposited into any SIB account and do not need to be segregated by mode.
  
• All funds capitalized into the SIB (both Federal and state) as well as future repayments must be treated as "Federal" funds. This factor may prevent certain types of entities from seeking SIB assistance.

FHWA is concluding a best practices review of the SIB Pilot Program as part of its Quality Financial Management Initiative. On September 19, 2000, a questionnaire requesting information on program development, institutional structure, implementation issues, accounting and reporting practices, and plans for the future was provided to 35 of the 39 state DOTs currently participating in the SIB Pilot Program. Nearly all of the states have completed the questionnaire and submitted their responses to FHWA.

A review team of FHWA headquarters, division offices, resource centers, and Federal Transit Administration staff conducted on-site visits at 10 states. During these visits, the review team interviewed state officials on individual SIB programs, including questions on administrative procedures, financial policies, and plans for further capitalization. In addition to a question and answer session, the review team toured selected projects that have been assisted by SIB funding. The 10 states visited during this review were Florida, Texas, South Carolina, Arizona, Missouri, Ohio, Maine, Pennsylvania, Michigan, and Oregon. Site visits began in September and were completed in December.

The review team is currently working on the draft report and plans to release the final SIB Best Practices report in 2001. The report will be available on the Clearinghouse when it is issued. It addresses legislative issues many states have faced as they developed their SIB programs. Some states, such as Pennsylvania, have modified their SIB legislation to make the process work more smoothly.

Florida and Arizona have been creative participants in the SIB program. Summaries of their activity are provided below. The Resource Library provides a comprehensive listing of Web sites maintained by SIBs. View the Resource Library.

The Florida SIB legislation is innovative in that it allows sponsors to propose their own interest rates. Part of the evaluation of the project is based on the Net Present Value of the repayment stream versus the loan value. The Secretary of the Florida Department of Transportation (FDOT) has encouraged local districts to seek out projects appropriate for SIB funding. FDOT has been willing to offer zero percent loans through the SIB as a subsidy to help deliver projects earlier than they would be otherwise. Florida's current plan for its SIB program will leverage $2.2 billion in total project development costs with $283.1 million in SIB loans. Florida SIB legislation

April 1999, the Arizona State Legislature passed SB1201, which provided SIB funding to assist in financing the acceleration of the Regional Freeway Program, to be completed by the end of 2007. Article 28-7674 established the SIB program. Arizona SIB legislation.

Learn more about the Arizona SIB (referred to as the Highway Expansion and Extension Loan Program) and read their 1998 annual report.

The Minnesota Department of Transportation (MnDOT) established the Transportation Revolving Loan Fund (TRLF) in 1997. The TRLF was created by the state law pursuant to Minnesota State Law 446A.085 Transportation revolving loan fund.

TRLF's comprehensive Web site provides information on all aspects of its activities.