HARRISBURG - Gov. Rendell said tonight that he was "cautiously optimistic" that within days he and legislative leaders could finally strike a compromise to end the 2 1/2-month budget impasse.
"We are not there yet, but we have made substantial progress," Rendell said at 9:30 p.m., shortly after breaking from an hour-long meeting at the governor's mansion with Senate GOP leaders. " . . . In the next day or two we have a real chance to close the gap and agree on upon something that will be beneficial for the citizens of this commonwealth."
The governor said that legislative leaders have agreed to several of his budget conditions - to provide more funding for education and economic development programs - and that the sides are coming closer to settling differences in how to pay for it all.
Senate Majority Leader Dominic Pileggi (R., Delaware) called the meeting "cordial," but said it had yielded no major breakthroughs.
The two sides, he said, remain divided by between $200 million and $300 million in what a proposed compromise budget offered by legislative leaders would raise in revenue.
"It's a process," Pileggi said. "Eventually, all budget processes end. This one has taken longer than most."
The rhetoric tonight was clearly ratcheted way down from that of just hours earlier when it appeared that all hope of an imminent end to the standoff was lost.
This morning at a stop in Bucks County, Rendell said it's time legislative leaders "get real and understand that this can't be a totally painless process."
The latest budget plan given to him by legislative leaders the night before, he added, "doesn't come close" to providing enough new revenue sources to balance the budget for this year and those to come.
Rendell's comments drew a quick and sharp rebuke from a top Pileggi aide.
"The governor's thirst for higher taxes is unquenchable," said Erik Arneson, Pileggi's spokesman.
Leaders of three of the four legislative caucus met for hours Wednesday before forwarding the governor a second budget proposal around midnight.
It revised one from last week that called for nearly $28 billion in spending, increased business and cigarette taxes, and the authorization of table games at Pennsylvania casinos.
Administration officials and legislative leaders would publicly discuss the latest offering only in broad terms today.
House Speaker Keith McCall (D., Carbon) said the revenue figures arrived at by the three caucuses used information provided by Rendell's budget experts, and he defended their accuracy.
"We are very confident that the number we are working on collectively . . . are good numbers," said McCall.
Rendell said that after the two sides reach a compromise, it would take about four or five days to move the package through the legislature and for him to sign it. Until then, Pennsylvania will remain the last state in the nation to complete a budget for this fiscal year, which began July 1.
Senior administration aides and legislative leaders are expected to resume talks at the Capitol tomorrow morning.