WASHINGTON - Congressional leaders said yesterday that they are close to hammering out an agreement with the Bush administration on legislation that would give the secretary of the Treasury broad authority to purchase up to $700 billion of "troubled" securities sold by financial firms, including illiquid auction-rate securities issued by state and local governments.

Some market participants, including the Regional Bond Dealers Association, are strongly urging lawmakers to give the Treasury wide discretion to purchase illiquid auction-rate securities, in addition to the troubled mortgage-related assets of financial companies.

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