WASHINGTON (AP) _ The Federal Reserve, which is having to adjust its portfolio management because of shrinking debt issues, may buy $30 billion less of Treasury securities over the next two years, a Treasury official indicated Thursday.

``While many things may change over the next 24 months, based on the Federal Reserve's current holdings and Treasury's current auction sizes, the new procedure could lead to net redemptions approaching $30 billion in coupon securities,'' Gary Gensler, Treasury's under secretary for domestic finance, said in a speech to the Bond Market Association in New York.

As a result, the Fed may be forced to go the secondary market to replace the securities it can't buy directly from Treasury, he added.

Gensler also said that Treasury, against the backdrop of budget surpluses and efforts to reduce debt, is continuing to consider eliminating the one-year Treasury bill.

``There are a limited number of statutory provisions that reference the one-year bill for the purpose of setting interest rates,'' he said. ``We are pleased with the progress to date of our discussions with Congress to designate appropriate alternative reference rates for student loans rates and other statutorily set rates that currently reference the one-year bill.''