WASHINGTON (MarketWatch)—Federal Reserve officials at their latest policy meeting were still refining how to raise interest rates when the times comes, according to minutes released Wednesday.

Raising rates will be different this time, given the Fed’s large balance sheet. The Fed used to control the amount of reserves in the banking system, but now banks are awash with more than $2 trillion in excess reserves.

To raise rates, the Fed is going to raise the interest rate it pays banks to park their reserves at the Fed.

To make sure the rate doesn't leak, the Fed has been testing a reverse repurchase agreement program.

Reverse repos (“repo” is Wall Street-speak for repurchase) are, at in essence, short-term loans provided to the central bank by institutional investors like money-market funds. They are expected to set a floor under short-term interest rates.

Fed officials had capped the program at $300 billion.

But at the March meeting, after experts said it had to be larger to work, Fed officials said they would increase its size during the initial rate hikes but only for “a short period,” according to the minutes.

Generally, Fed officials appear uneasy about the reverse repo policy tool.

A couple of Fed officials pointed to “financial stability concerns” with having such a large program.

There has been concern that, in times of market stress, investors will rush into the safety of the Fed’s reverse repo facility. This is what led to the cap on the total borrowing size on any given day in the first place.

Many Fed officials said they would even consider selling short-term Treasury securities to reduce the repo use.

If reverse-repo usage was “undesirably large” during the early rate hikes, most Fed officials said they would first raise the interest rate on excess reserves to widen the spread.

But many officials were open to selling short-term assets on its balance sheet at some stage to reduce the reverse repo usage.