The National Academies

NCHRP 20-24(13) [Completed]

Innovative Financing Clearinghouse
[ NCHRP 20-24 (Administration of Highway and Transportation Agencies) ]

  Project Data
Funds: $199,359
Research Agency: Parsons Brinkerhoff Infrastructure Development Company
Principal Investigator: Stephen Lockwood
Effective Date: 8/18/2000
Completion Date: 9/14/2002

Background: Transportation decision makers today are looking beyond traditional financing sources to meet the growing backlog of unfunded transportation needs. In recent years, new financing mechanisms have emerged to help fill the gap. Some of these new mechanisms have been generated at the state and local levels; others were made possible by the 1991 Intermodal Surface Transportation Efficiency Act (ISTEA), the National Highway System Designation Act of 1995, and the Transportation Equity Act for the 21st Century (TEA-21).

This emerging trend was evidenced by the Transportation Research Board's Conference on Transportation Finance for the 21st Century held in April 1997. This conference attracted nearly 500 federal, state, and local government officials and private-sector representatives. The conference participants recognized the success these mechanisms are having in bridging the gap in financing the nation's transportation infrastructure.

Given the rapid pace of developments in transportation finance, the challenge for state transportation departments is determining how best to share information and best practices and how best to provide for continued learning and knowledge transfer. One of the conference's findings included a recommendation for establishing a clearinghouse for innovative finance information, such as success stories and best practices. The Administrative Subcommittee on Financial Management of the American Association of State Highway and Transportation Officials (AASHTO) recognized the importance of improving the understanding of innovative financing and initiated the development of the clearinghouse under the auspices of the National Cooperative Highway Research Program (NCHRP).

Overall, the proposed clearinghouse will fulfill a vital function in meeting the information needs of transportation departments in the area of innovative finance. Through information sharing and lessons learned, transportation decision makers will be better positioned for success as they implement new and innovative ways of financing transportation improvements. Experience has shown that innovative finance is a key strategy to increase the number of transportation projects funded, expedite project completion, and contribute to economic development.

Objective: The objective of the research project is to develop and implement a clearinghouse to provide convenient access to the best available current information on innovative surface-transportation financing practices. The scope of this project is intended to include issues related to federal, state, regional, local, and private funding of surface transportation (highways, passenger rail and bus systems, intermodal links, intelligent transportation systems, and related facilities), with an emphasis on innovative alternatives to traditional funding methods. The definition of innovative funding includes the application of alternative contracting mechanisms when coupled with innovative financing methods.

Tasks: Accomplishment of the project objective will require at least the following tasks.

(1.) Identify potential customer user groups (including AASHTO member departments, metropolitan planning organizations [MPOs], local transportation agencies, and other transportation stakeholders), and assess their information and technical assistance needs relative to innovative finance. Evaluate the need to include an "Executive Level" feature in the clearinghouse menu. (2.) Define what information and services would be offered in the best case, or "ideal" clearinghouse, to address the needs of the users identified in Task 1. These should include but not be limited to the following categories:

(a) Scope of information offered
    • Basic principles of transportation finance
    • Why traditional funding mechanisms are limiting
    • An innovative finance "toolbox," containing descriptions, pros and cons, and suitability of various innovative finance methods
    • Case studies and best practices presented in a consistent and succinct format
    • How to integrate and evaluate the tools in the decision-making process
    • Legal and institutional considerations
    • Federal, state, and local legislation and regulations
    • Implementation approaches and consensus-building strategies
    • Directories of expertise/contacts and other available resources
    • Educational opportunities
    • Glossary of terminology
(b) Clearinghouse service characteristics
    • Primarily Web-based
    • "One-stop shopping" concept
    • Full text documents online, where copyright permits
    • Links to other relevant sites
    • Ongoing synthesis of new information
    • Discussion forum, interactive if possible
    • User-friendly, visually appealing
    • Regular updates and maintenance
    • Mechanism for agencies to input new or updated material
    • Repository of hard-copy reports and documentation
    • Other appropriate means of communication, such as newsletters, bulletins, CD-ROMs, telephone hot-line
(3.) Identify available transportation information resources dealing with innovative and alternative financing. The clearinghouse should complement, not duplicate, existing resources.
(4.) Investigate best practices of clearinghouses in other subject areas as a model for the proposed innovative financing clearinghouse. (5.) Recommend a proposed initial structure, content, and implementation plan for the clearinghouse. This task should clearly indicate which elements can be included within the project budget (from those identified in Task 2) and should justify why these elements are considered to be the most important for initial implementation.
(6.) Identify the anticipated long-term resources needed to operate and maintain the clearinghouse beyond the contract period. This task should present options for a range of annual service levels, anticipated annual budget requirements for each level over a 5-year period, and options for funding and administration/ownership of the clearinghouse. This task should also identify opportunities for cost recovery or revenue generation. (7.) Develop a plan to promote and market the use of the clearinghouse. (8.) Submit an interim report that documents the information developed in Tasks 1 through 7. The contractor should be expected to meet with the project panel approximately 1 month after delivery of the interim report. The panel must approve this interim report before any work begins on subsequent tasks. (9.) Upon approval of the interim report by the NCHRP, design, develop, implement, and populate the clearinghouse and operate it for a trial period of 1 year. (10.) After 3 months of operation, present final recommendations for longer-term maintenance and operation, including a transition plan to clearly indicate how responsibilities can be transferred to a new host or sponsor. In this task, the contractor is invited to present a proposal for an extended contract to carry out the operation and maintenance of the clearinghouse over a 5-year period. (11.) Implement the approved transition plan, if longer-term hosts and sponsors are identified and secured. (12.) Submit a final report that documents the entire research effort. The final report should include recommendations for future enhancements of the clearinghouse, including expansion to other transportation modes.

Status: This project is completed and the clearinghouse has been adopted by AASHTO.

Product availability: The clearinghouse can be accessed at www.innovativefinance.org.

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