Pennsylvania ends shutdown as budget stalemate ends

By Jon Hurdle

SCRANTON, Pennsylvania (Reuters) - Pennsylvania ended a partial shutdown of state services late on Monday after lawmakers cleared the way for Gov. Ed Rendell to sign a budget more than a week after the start of the new fiscal year.

After 24 hours in which about 25,000 state workers in non-essential services were idled without pay, Republican legislators reached agreement with Rendell on a series of measures the governor had insisted on as a precondition for signing the $27.37 billion 2007-08 budget for the year beginning July 1.

"We are rescinding the furloughs ... to take effect at 12:01 a.m." on Tuesday, Rendell said at a late-night news conference.

Rendell said he had reached agreement on the measures with lawmakers shortly after 9 p.m., allowing him to say that a new budget deal is now in place.

There had been some "give and take" by all parties in the talks, but the administration had achieved its budget priorities including funding for mass transit, a program to contain health-care costs, and an energy-conservation package, Rendell said.

"If you ride mass transit, you are going to take this as one heck of a budget," Rendell said.

The major sticking point was the wide-ranging energy package that would impose electricity surcharges on householders and business to pay for energy-saving measures such as household appliance rebates and solar power grants.

Republicans attacked the surcharge that would mean an extra 45 cents a month on residential electric bills and $3 a month for the typical business. GOP negotiators succeeded in scrapping the surcharge, which is now expected to be reconsidered in the Fall.