Leading lawmakers continue talks on Pa. budget

HARRISBURG, Pa. (AP) - September 16, 2009 "We want to do everything possible," Senate Appropriations Chairman Jake Corman, R-Centre, said as discussions broke off for dinner. "When a deal gets this close, you like to close it."

Lawmakers said the size of the budget and the new revenues needed to pay for it had not changed since three of the four legislative caucuses announced a tentative "framework" $27.95 billion budget deal Friday.

They said the latest sessions focused on addressing the Democratic governor's doubts that the mixture of new and additional taxes would bring in as much money as they assumed. They also were shifting money around to reflect more of Rendell's priorities. Rendell has threatened to veto the budget if it gets to his desk without significant revisions.

"The parameters of the deal have not changed," said House Speaker Keith McCall, D-Carbon. "The revenues that we talked about and the spend number that we talked about are the same. We haven't deviated from that."

Participants said disputes remained over how much more revenue would come from increasing the limits on small games of chance and taxing the proceeds, on a proposal to eliminate $75 million in tax credits and on funding specific programs. But there clearly was a tone of optimism that the end of the impasse was in sight.

"The administration has its share of interest in raising some spending here and cuts someplace else, the House Democrats as well," Corman said. "So we're 98.59 percent there, as far as that goes."

The only legislative caucus not participating was the House Republicans, who have assailed the proposal for the overall amount of spending and for imposing taxes during an economic slowdown. Some of Rendell's senior aides joined the talks Wednesday, and Rendell press secretary Gary Tuma described the sessions as productive.

"Legislators are still trying to put together a fiscally sound and sustainable plan that the governor requires," Tuma said. "They are working on it, and we are trying to help."

Pennsylvania has been without a comprehensive budget deal since the new fiscal year began July 1, making it the last state in the nation still wrestling over its annual spending plan. A stopgap measure, however, was passed to pay state workers and fund billions in other government spending.

The three caucuses on Friday announced the tentative deal to raise business and cigarette taxes, legalize table games such as poker at casinos and expand natural-gas drilling on state-owned land.

It would increase spending on the basic public school subsidy by $300 million and provide about $1.2 billion in recurring revenues to lessen the financial blow from projected shortfalls in the coming years.

"We're not interested in having this all fall apart and to raise taxes next year any more than (Rendell) is," Corman said. "Probably even less."

A conference committee meeting had been planned for Monday, but it has been delayed indefinitely. Meanwhile, some members of the House Democratic caucus have been pressing their leaders to address Rendell's doubts about revenues, to tax natural gas extraction and to eliminate legislatively directed spending known as "walking around money" from the budget.

McCall said the tax on natural gas from the Marcellus shale formation beneath the state would not be a part of the budget agreement.

"There will be a bill moved in the House," he said. "And it's not part of this deal, but our members feel very strongly about the extraction tax."

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