- Associated Press - Thursday, August 13, 2015

HARRISBURG, Pa. (AP) - Gov. Tom Wolf and a key Republican budget negotiator emerged Thursday from the latest meeting on Pennsylvania’s budget impasse to say they are still grappling with unresolved issues and plan to talk again next week.

Wolf, a Democrat, and House Majority Leader Dave Reed said they worked on two major issues - how much to spend on education and proposals to cut public sector pensions.

“I think we have a tentative agreement on the fact that pensions and education funding are going to have to be part of a final budget discussion, final budget agreement,” Reed, R-Indiana, told reporters. “I don’t think we necessarily have the framework in place. There are a lot of items to be worked out.”

Wolf used the terms “good conversation” and “good discussion” several times but did not describe progress on any of the issues that divide the sides. He has sought billions in new sales, income and gas-drilling taxes to close a budget gap and increase funding for public schools and human services.

“There’s a different tone in these conversations,” Wolf said. “I think we’re having good conversations, and I know I’ve always talked about progress in a very generalized sense. I think that there’s some good conversations here, frank exchange of views, but I think we are moving in the right direction.”

As recently as Tuesday, at a news conference in Norristown, Wolf slammed the Republicans’ budget proposal, using terms such as sham, insult and disgrace.

The first-year governor vetoed a no-new-taxes budget that passed the Republican-controlled Legislature without a single Democratic vote, and also vetoed GOP proposals to sell off the state liquor system and cut pensions for state workers and public school teachers.

The budget impasse has so far had minimal practical impact, although the clock is ticking for county governments, school districts and others who will eventually have tough choices to make if state funding does not resume.

Any agreements about how much to spend on schools and what changes to make on the two large public-sector pension plans will not, by themselves, solve the wider budget crisis, Reed said.

“We believe there’s a number of items that will need to come at the next level of discussions,” Reed said. “I think property tax reform is probably one, liquor privatization or changes to our liquor system is another and there’s some other items that will come into that discussion as well.”

Wolf has proposed a massive tax shift away from the local property taxes that fund much of public schools in the state. The House has passed a similar plan but it has been stalled in the Senate.

Wolf said the sides plan to meet next on Tuesday.

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