Senator Ron Wyden told a White House meeting he is ready to propose a new version of the Build America Bonds program that was part of the federal stimulus plan and that expired in December.

The very popular taxable bonds paid issuers federal rebates equal to 35 percent of interest costs.

The Build America Bonds, in the year and a half we had them in the Recovery Act, were wildly successful, said Wyden at a meeting of the President's Export Council on infrastructure.

Folks have been concerned that they've been popular and have been used for other circumstances. So, this time it looks like there will be bipartisan support to rebrand them and get them reserved just for transportation, only for transportation, he said.

After their debut in April 2009, issuers sold more than $180 billion BABs, a breathtaking sum, Wyden said.

So far, three bills have been introduced in the House of Representatives to revive them, but the Senate has yet to take up any legislation and the $2.9 trillion municipal bond market is eagerly waiting for Wyden to unveil his proposal for a rebranding.

Wyden, a Democrat, said the new bonds in his bill would be called TRIPS, standing for Transportation and Regional Infrastructure Bonds, and he hoped the new moniker would help generate support from both parties.

He added that getting Republicans and Democrats to agree on other ideas for generating revenue for transportation, such as an infrastructure bank, would be a struggle but that TRIPS bonds already are pretty much ready to go.

Congress had two aims with Build America Bonds. Because they were intended to finance infrastructure, the bonds would help provide jobs for construction workers displaced by the housing market collapse. Also, they were structured to thaw the municipal bond market, which froze at the end of 2008.

The end of the BABs program meant that states and cities lost a vital credit lifeline, and they have been worried that their costs to borrow could rise just as they are confronted with budget problems caused by the 2007-2009 recession. The housing market collapse, financial crisis and recession ravaged their revenues and forced them to cut spending, hike taxes, turn to the federal government for help and borrow at higher levels to keep their budgets balanced.

Issuers rushed to sell the debt because of the hefty rebates. Most proposals to bring BABs back have lowered the subsidy, with President Barack Obama suggesting the lowest rate of 28 percent of interest costs. Wyden did not describe how the subsidy would work under his bill.

A move in December to extend the program failed in Congress after Republicans demanded it be cut from a tax deal.

And while the Republican head of the House of Representatives Transportation Committee said he will consider a reincarnation of BABs in a sweeping roads and highways bill, Republican opposition to BABs remains strong.

Powerful Republicans such as Rep. Paul Ryan and Sen. Orrin Hatch, say states in the worst shape will have to sell the bonds at high interest rates, which will garner them the steepest subsidies.

An advisor to the Republican Chairman of the House Ways and Means Committee on Thursday responded to a Democratic proposal to temporarily reinstate the BABs program by saying it is simply a subsidy for state and local governments to go deeper into debt.

(Additional reporting by Kim Dixon; Editing by Theodore d'Afflisio)