WASHINGTON - A Harrisburg, Pa., authority was pushing forward yesterday with a complex transaction under which it would issue $780 million of tax-exempt refunding bonds and taxable bonds to finance a hydroelectric power plant and other projects, but some lawyers and federal officials say the deal could violate tax laws.

"Based on what we've heard about the transaction, there appear to be very serious concerns that the ~refunding' bonds may actually be taxable hedge bonds," said one federal official who did not want to be identified.

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