To direct the Secretary of Transportation to offer federally financed, interest-free loans to public schools, municipalities, and local governments for the purchase of hybrid electric or other high-efficiency vehicles, and for other purposes.

Directs the Secretary of Transportation to establish a program to offer federally-financed, interest-free loans to local educational agencies, public institutions of higher education, municipalities, and local governments for the purchase of hybrid electric vehicles (with a fuel-efficient gasoline engine assisted by an electric motor) or high-efficiency vehicles (that use a fuel other than gasoline or diesel fuel).