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Pa. budget deal riles Rendell, House GOP

Legislative leaders announced the plan Friday. "It doesn't add up," the governor said.

When legislative leaders stepped onstage Friday to announce they had reached a budget deal, it was clear there wasn't universal agreement in the Capitol on their $27.9 billion proposal.

The two most powerful groups - Democrats who control the House and Republicans who hold the majority in the Senate - were on hand to tout the compromise, along with Senate Democrats. But Gov. Rendell and the House Republicans were notably absent. Announcements on budget compromises usually include plenty of smiles and backslapping all around.

A few hours later, it became clear why neither the governor nor his aides had been there. He said that the proposal was inadequate and would force tax hikes next year, and that he would veto the measure.

At a news conference in the Capitol yesterday, Rendell ripped what he called "the three-caucus plan" as being woefully short on revenue predictions and as shortchanging students and business development.

"It doesn't add up," said Rendell, who promised a swift veto if the bill presented Friday hits his desk. "It would be a disastrous budget for the citizens of the commonwealth because of the damage to education and economic development."

But he said he wanted to give negotiations one last try and scheduled a meeting with legislative leaders at the Governor's Residence tonight.

The governor's response angered one of the chief architects of the agreement - Senate Minority Leader Robert J. Mellow (D., Lackawanna). In an interview Friday, he criticized Rendell for "drawing a line in the sand" when the majority of the legislature was exercising flexibility in the interest of reaching a compromise.

"Now is not the time to be argumentative," said Mellow, who is credited with bringing the sides together in private talks during the last two weeks.

He and the other leaders contend that the budget is balanced.

House Republicans say they rejected the compromise plan because it includes tax increases, spends too much, and is unsustainable.

The House Republicans, while in the minority, could sink the deal if they can deliver their caucus' 97 votes (two members are serving in the military overseas) and persuade six conservative Democrats to go along with them.

Still, Mellow said he hoped the compromise, for which he believes he was the catalyst, would succeed.

Filled with frustration over the lack of progress on budget talks, he phoned Senate Majority Leader Dominic Pileggi (R., Delaware) two weeks ago and said: "We look like crap. We're not doing anything."

That conversation led to several meetings at the lieutenant governor's mansion at Fort Indiantown Gap, northeast of Harrisburg, between top Senate Republican and Democratic leaders. The result was a framework budget agreement to end the nearly 10-week legislative impasse.

Over Labor Day, they brought in the two top House Democrats, Speaker Keith McCall of Carbon County and Majority Leader Todd Eachus of Luzerne County. Both young leaders are relatively new to the budget process, and both come from Mellow's region in the northeast.

Wednesday night, they sealed the deal.

The $27.9 billion package announced Friday would reduce overall spending from last year and cover nearly $1.2 billion in deficits by cleaning out the Rainy Day Fund; instituting a range of limited tax increases. including 25 cents a pack on cigarettes; and authorizing table games at slots parlors. It also would preserve $300 million in additional education funding.

In an interview, Mellow said he had relied on his nearly 40 years of legislative experience to persuade Senate Republicans and House Democrats that, with fall upon them, it was time to complete the process.

"I've been through budgets many times. It's not brain surgery," said Mellow, who was first elected to the state House in 1970. "I've got a tremendous amount of knowledge, and I could not let this go on."

Pileggi credited Mellow's experience in both the Senate and the House and in dealing with different governors with helping get the deal done.

"He helped provide a historical framework for how negotiations play through," he said Friday. Pileggi said the process had been accelerated when both parties realized after reviewing budget spending items that the governor vetoed last month that they agreed on most funding levels.

Despite Rendell's veto threat, House leaders are pushing ahead with plans to reconvene a House-Senate conference committee tomorrow to vote on a final budget bill to be considered by the House and Senate later.

Pileggi said he believed that the votes existed in the GOP-controlled Senate to override a budget veto - which would be the first such override since 1978, during the administration of Milton J. Shapp.

Rendell said lawmakers would "pay the price next year" when they would be forced to raise taxes.

Mellow said he hoped for an amicable resolution with Rendell.