HARRISBURG - A key House Republican said Friday that he hoped to have a budget deal finalized by Thanksgiving, and Gov. Wolf said an agreement to end Pennsylvania's five-month-old impasse could be "very close."

In an email Friday afternoon to fellow legislators, Majority Leader Dave Reed (R., Indiana) became the first elected official to predict an end date to the stalemate. Without elaborating, he said negotiators "are making progress toward the framework" of a final deal that could include changes to the state's liquor and pension systems, increased education funding, and offer property-tax relief.

Around the same time, Wolf made an appearance at a conference in Philadelphia and said a deal was "very, very close."

"I think we're almost there," he told an interviewer at ThinkFest, hosted by Philadelphia Magazine.

Neither the first-term Democratic governor nor the GOP leader explained why they thought the impasse was nearing a resolution. Negotiators have claimed to have made progress on a deal multiple times since July, though never offering details. But Reed told members of his caucus to expect a more thorough update next week.

The optimistic remarks came just a day after Montgomery County said it would stop paying for human services normally funded by state aid - the latest example of how school districts, nonprofits, and county agencies have had to slash or borrow their way to survival during the impasse.

Reed's spokesman, Stephen Miskin, cautioned that negotiations were still ongoing. Senate Minority Leader Jay Costa (D., Allegheny) said discussions had become "more focused" in recent days, but added that talks were still "very, very fluid."

"What's in the conversation a week ago might not be next week," Costa said.

Wolf and the Republican-controlled legislature have been at odds since failing to agree on a spending plan by the July 1 deadline. Wolf has been steadfast in calling for a new permanent revenue source, such as hiking the personal income tax, to send more money to state schools.

But an income tax increase was voted down overwhelmingly by the House last month. And Republicans have long said that there is no appetite for significant new levies.

As the dispute dragged into its fifth month, Pennsylvania remained one of only two states without a spending plan, the other being Illinois.

Wolf told his interviewer Friday he had "held out for a real budget" that can help close the state's multibillion-dollar deficit.

Despite the prolonged gridlock, he said, "I think there are a lot of people on both sides of the aisle who believe that's where we need to be."

cpalmer@phillynews.com 609-217-8305