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Illinois governor fails to budge as fiscal deadlock drags on

SPRINGFIELD, Ill. (Reuters) - Illinois Governor Bruce Rauner refused to step away from his stalled legislative agenda on Wednesday while insisting that a spending deal remains within reach, but his words appeared to leave his Democratic rivals unmoved.

Republican Bruce Rauner smiles after winning the midterm elections in Chicago, Illinois, November 4, 2014. REUTERS/Jim Young

Republican Rauner and the Democratic-controlled legislature have been locked in a budget stalemate for nearly seven months.

“To achieve a grand compromise, we must cast partisanship and ideology aside,” Rauner told the state legislature in his State of the State address. “We must break from the politics of the past and do what is right for the long term future of our state. I’m ready, and it’s my genuine hope that you are too.”

Rauner, a political newcomer, became governor a year ago. The wealthy venture capitalist used last year’s annual speech to lay out an ambitious agenda that included business-friendly changes to workers’ compensation, a freeze on local property taxes, curbs on public-sector collective-bargaining, and legislative term limits.

But Rauner’s so-called turnaround hit a brick wall in the legislature, where House Speaker Michael Madigan pronounced it “extreme.” The stalemate has left Illinois without a budget more than halfway through fiscal 2016.

About 90 percent of state government is being funded through court orders, an enacted spending bill for K-12 schools, and continuing appropriations for pensions and bonds.

In a nearly 40-minute speech that drew robust Republican applause but only a tepid Democratic response, Rauner did not abandon his stalled plan and lobbed barbs at two primary Democratic constituencies.

“I understand that union leaders and trial lawyers are putting pressure on you to keep the status quo, but if we don’t offer a competitive environment for businesses, pretty soon the unions won’t have any more jobs to unionize and the trial lawyers won’t have any more businesses to sue,” Rauner said, producing sarcastic laughter from some Democratic lawmakers.

After the speech, Democrats continued to balk at the governor’s agenda and questioned why he made no direct reference to the casualties of the budget impasse, including the state’s university system, rape-crisis centers and other human-service providers that have been deprived of state funds.

“I certainly would have appreciated it had he done that,” Madigan told reporters.

But Rauner’s GOP ally, House Republican Leader Jim Durkin, dismissed the speaker’s criticism.

“Today is the state of the state, not the state of the budget,” Durkin said.

The day ended with the spectacle of the lone public Rauner sympathizer within Madigan’s 71-member super-majority Democratic caucus lashing out at the speaker while appearing before reporters and carrying a red sleeping bag and backpack.

State Rep. Ken Dunkin, a Chicago Democrat, used his props to dramatize his willingness to stay at the Capitol and even “shower” in the speaker’s private statehouse bathroom for as long as it takes to strike a budget deal.

For a deal to happen, Madigan needs to “stop holding the citizens of Illinois hostage to his political maneuvering, to his political shenanigans, and actually get things done,” Dunkin said.

Additional reporting by Karen Pierog in Chicago; Editing by G Crosse, Matthew Lewis and Bernard Orr