In the end, the backers of separate gambling proposals could not agree on how many slot machines to make legal or where, and neither side had the support to win approval alone, sources said. The slots initiatives are dead, at least for the remainder of this year.

"I don't think the proponents of slots were able to come to an agreement on how it should be done,'' said state Sen. Noah W. Wenger, a Republican from Stevens. "They never got enough people on the same page to make it happen.'' Opponents of legalized gambling were satisfied this morning, but cautioned there will be another push for slot machines in the next month or two.

"Obviously, they're going to be back in full force,'' said state Sen. Gibson E. Armstrong, a Republican from Refton. "It's like holding back the waves of the ocean -- you can block one, but there's always another one behind it.'' Gov. Ed Rendell, who wants to use the $1 billion in projected revenue from slot machines for property-tax cuts, said he was "as confident as I can be'' that a gambling bill would pass by the end of January.

Wenger, Armstrong and Majority Leader David J. "Chip'' Brightbill -- the county's delegation to the Senate -- all oppose legalizing slot machines.

All three voted in favor of the budget. The Senate began considerations of the spending plan about 4 p.m. Friday and adjourned at 7:38 a.m. today.

"I feel very good about the budget deal,'' said Brightbill, a Republican from Lebanon who represents a small part of northern Lancaster County. "We've all done our jobs. ... It's a compromise I can live with.'' The measure now moves to the House, where many Democrats have said they would be reluctant to approve an income-tax increase without reducing property taxes. Even so, the House is expected to approve the plan.

Final approval of the bill would end a nine-month impasse between Rendell, a Democrat, and the Republican-led General Assembly. Pennsylvania is the only state in the nation without a budget for 2003-04.

If the bill is signed by Rendell, the state income tax would increase from 2.8 percent to 3.07 percent, or 9.6 percent. For a household with a taxable income of $50,000, the proposal would increase the state income tax by $135 a year.

That is far less than what Rendell had originally proposed -- 3.75 percent -- earlier this year.

"We held firm for quite a while. I feel it's a better budget, tax-wise, than the governor wanted,'' Armstrong said.

Said Wenger: "It is conservative to say that we saved the taxpayers of Pennsylvania at least $1.5 billion dollars by holding out here and getting a reduction in the tax increase.'' The budget would increase basic education funding by 3 percent or $121.1 million. It would also increase special-education funding by 4.5 percent or $36.1 million.

Armstrong and Wenger said the state increases in education spending should prevent many school districts from having to raise property taxes any time soon.

"Hopefully, we won't see a property tax increase from our school districts in the next couple of years,'' Armstrong said. "They'll have no reason at all to raise local property taxes.'' The Senate plan would also reimburse school districts $4.6 million in interest that they incurred by borrowing money when the state failed to release subsidies in August and October.

It would restore some cuts made in an earlier barebones budget for libraries, drug-and-alcohol programs and other social services, and mass transit.

The budget would also levy new cell phone and long-distance charges, plus tack on 35 cents to the price of a pack of cigarettes. The revenue would help physicians pay medical malpractice premiums.

The Senate approved the tax portion of the budget, 30-19, and the spending part, 42-7.

The legislative session lasted so long not because of the budget, details of which had been hammered out between Rendell and Senate leaders earlier this week, but because of the closed-door wrangling over gambling.

A slots deal fell apart anyway because gambling proponents could not agree on whether the bill should include licenses for American Indian tribes, as proposed by Sen. Vincent Fumo, Democrat of Philadelphia.

Rendell's chief of staff, meeting with Fumo late Friday evening, reportedly tried to persuade Fumo to drop the clause, but Fumo would not.

Instead Fumo blamed "a small handful of lawmakers'' for blocking his plan -- specifically Republican Sen. Robert M. Tomlinson of Bucks County, who drafted a competing gambling bill that excludes American Indian tribes.

Tomlinson's bill also would have allowed two fewer venues -- 11 -- than Fumo's would have.

"Significantly, the objection of those who opposed our plan was not that we would have 13 venues -- the number necessary to earn $1 billion for property-tax relief -- but was simply an objection to who owns a particular slot venue,'' Fumo said in prepared remarks. "We have yet to hear a substantive argument for why Indians should be excluded from this legislation.'' Fumo accused Tomlinson of withholding GOP votes that could have given Fumo's bill a majority. "Where we're down to now is ego,'' Fumo said. "He feels he owns the issue, but he doesn't have the votes.'' In the end, neither Fumo nor Tomlinson put their bills up for a vote.

Michael Geer, an Elizabethtown resident who is president of the conservative Pennsylvania Family Institute, said he knows gambling proponents will be back. But he is nonetheless elated that the slots negotiations fell apart.

"We're overjoyed that 2003 will come to a close without casino gambling coming to Pennsylvania,'' Geer said.

(The Associated Press contributed to this report.)

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