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Pa. budget agreement may be collapsing

HARRISBURG - A tentative agreement to end Pennsylvania's five-month-old budget impasse appeared to be collapsing Saturday night as Republicans in the House and Senate revealed starkly different plans for moving forward after a day of closed-door meetings.

HARRISBURG - A tentative agreement to end Pennsylvania's five-month-old budget impasse appeared to be collapsing Saturday night as Republicans in the House and Senate revealed starkly different plans for moving forward after a day of closed-door meetings.

While Senate leaders announced they were closing in on agreements with Gov. Wolf about how to distribute $350 million in new education funding and changes to the state's pension and liquor systems, House Republicans said they were pursuing a plan that would scrap those initiatives altogether.

Rank-and-file House members emerged from their hours-long caucus to say they would pursue their own pared-down budget, eliminating the need to expand the sales tax to send more money to schools.

"I think the rank-and-file aren't accepting of massive tax increases," said Rep. Seth Grove (R., York). "And I think [House Republican] leadership realized that, and they backed off, and they're moving in a direction that we can go in."

Wolf swiftly released a statement tearing into Republicans for abandoning the so-called framework agreement that House and Senate leaders had agreed to more than a week ago and have trumpeted ever since.

That agreement would provide the boost in education funding through a sales-tax expansion as well as pension and liquor system changes, which are two long-held Republican priorities.

"It is long past time for the legislature to move ahead with this agreement and end this impasse," Wolf said.

House Majority Leader Dave Reed (R., Indiana) and House Speaker Mike Turzai (R., Allegheny) declined to comment.

How or when negotiations will resume was unclear Saturday night.

Senate Majority Leader Jake Corman (R., Centre) said that his chamber could begin voting on budget-related bills during a rare Sunday night session and that senators would still push the items negotiated under the framework with Wolf.

For a final budget to pass, both the House and Senate have to agree on a series of bills that Wolf would then also have to approve.

The two chambers could theoretically pursue different agendas independently of each other, a scenario that even Harrisburg veterans struggled to comprehend.

The potential collapse of the framework could be a crushing blow to negotiations that have dragged on for months. The state has been without a budget since July 1, forcing schools, nonprofits, and counties to borrow or cut their way to survival in the absence of relied-upon state aid.

Many of those agencies have been pushed to the brink as the impasse continues to linger. Several school districts, including Philadelphia's, have said they may not be able to open in January if a budget is not completed by then.

Bill Patton, spokesman for House Democrats, said that members were still hopeful a deal could be struck soon but that many were unaware of the changes proposed by Republicans.

"We have not been briefed on whatever it is they might be contemplating," he said.

That new agenda called for a $30.2 billion budget rather than the $30.8 billion under the framework, according to Grove.

The spending decrease would likely reduce the need to raise the rate on sales or personal income taxes for new revenue. But it would also mean backing off Wolf's long-stated priority: the $350 million increase in basic education funding.

Grove did not say how much new money might be directed to schools under their new plan.

One memo circulating among House Republicans, obtained by The Inquirer, suggested increasing basic education funding by about $150 million.

The new plan would also eliminate the liquor and pension changes called for under the framework. Grove said Wolf would probably reject those items without receiving the education boost he wanted, so Republicans didn't see the need to include them in their plan.

It was not clear whether there were enough votes in the House to actually pass this new agenda.

Stephen Miskin, House Republican spokesman, said, "We're united" behind it.

Patton said Democrats had not seen the details and were unlikely to support anything without a significant increase in education funding.

In the Senate, meanwhile, Corman said Republicans were working out the details on a number of the contentious items from the framework.

To modify the state liquor system, Corman said, consumer access to wine and spirits would be expanded to allow purchases outside of state-owned liquor stores.

On pensions, he said new state and school district employees would likely be placed in what is dubbed a "hybrid" system.

But, after Saturday's blow-up, will any of those details even matter?

Miskin, the Republican spokesman, was blunt.

"We'll see," he said.

cpalmer@phillynews.com 609-217-8305

@cs_palmer