A stop-gap budget passed by the Pennsylvania House and Senate yesterday is expected to be signed by Governor Ed Rendell (D-PA) sometime today. As the new fiscal year enters its second month, Pennsylvania lawmakers remain unable to reach a complete spending package that addresses the state’s $3.25 billion deficit.

Rendell has remained insistent upon his calls for a $1.6 billion personal income tax increase. However, House Democratic leadership announced this week that Rendell’s personal income tax increase is now off the table. That’s a good thing seeing as the 16% income tax hike that Rendell wants would result in a loss nearly 24,000 jobs according to analysis by the Beacon Hill Institute.

Pennsylvania legislators must now go back to the drawing board. It’s uncertain where things will go from here. Rendell insists that he still wants $1.6 billion in new revenue however he can get it. Senate Republicans, who hold a 30-20 majority in that chamber, remain steadfast against any tax increases.

Smart money is on Pennsylvania lawmakers spending a long, hot summer in Harrisburg.