WASHINGTON - The Senate yesterday cleared most of the remaining obstacles to the approval of a $123 billion highway and mass transit bill after it rejected an amendment sought by state transportation officials that would have maintained the federal share of interstate highway repair funding at 90%.

After 10 days of debate, however, the five-year reauthorization measure was still under the lingering threat of a filibuster by Sen. Bob Graham, D-Fla., who continued to object to its formula for funds distribution. Most of the lengthy and cantankerous debate over the bill has centered on the state allocation issue. The debate appeared to culminate yesterday with an unexpectedly popular amendment to return to the current state matching requirement that was being pushed at the last minute by state highway officials.

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