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Budget deal close but elusive as Legislative deadline nears

ST. PAUL - Top lawmakers and Gov. Tim Pawlenty entered today, the final full day of work in the legislative session, lacking an overall budget deal as pressure mounts to end the 2008 Minnesota Legislature with all sides claiming some victories.

Despite the slow-moving budget talks, both Democratic and Republican lawmakers said they expected a smooth finish to the session.

"It's two steps forward, one step back, so eventually we'll make it," House Minority Leader Marty Seifert, R-Marshall, said before midnight as he left closed-door talks between legislative leaders and Gov. Tim Pawlenty.

Republican Pawlenty and Democrats who control the Legislature say they are close to a deal that fixes the state's $935 million deficit and provides some Minnesotans property tax relief.

"There's always little pieces that need to fall into place," Seifert said.

Democratic lawmakers saw a path was forming to an orderly end of session.

"These things took a little time but once we kind of worked through a bunch of issues - and maybe a little bit of posturing - I think we're on our way," House Speaker Margaret Anderson Kelliher, DFL-Minneapolis, said earlier Friday evening.

Lawmakers said there is general agreement to cap property tax increases, as Pawlenty wants, though early this morning there still was no deal over the duration of a cap and possible exemptions. There was general agreement cities with less than 2,500 people would not be subject to a state-imposed property tax cap.

A House-Senate tax negotiating committee will iron out remaining differences in the tax proposal, which also is expected to leave some homeowners with property tax cuts and local governments with more state aid.

There is general agreement on most of the budget-balancing package, but some details remained unresolved heading the last full day that lawmakers can meet to pass bills.

Legislative talks early this morning centered on finalizing a health-care reform proposal that could be part of an overall agreement between lawmakers and Pawlenty.

Rep. Tom Huntley, a Duluth Democrat and the House health finance chairman, said expanding eligibility for public health care programs continued to be a sticking point.

Pawlenty and the Democratic-Farmer-Labor Party-led Legislature found some disagreements heading into today as the governor vetoed four bills Friday. They included a modest education funding package and a measure aimed at blocking Minnesota from taking part in a federal security program.

Both issues could reemerge as the session draws to a close. The state constitution requires it end by Monday, but lawmakers cannot pass bills on the final day.