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HARRISBURG, Pa. (AP) — Pennsylvania's epic budget stalemate ended Wednesday as the Democratic governor backed off his latest veto threat, leaving slivers of his once-ambitious agenda intact after nine months of partisan gridlock that threatened to close schools, forced social-service agencies to lay off employees and resulted in millions in borrowing costs for county governments. First-term Gov. Tom Wolf's drive for a multibillion-dollar tax increase from a Republican-controlled Legislature to fund a record increase in public school aid ultimately failed— he got half the aid he wanted — and precipitated a budget fight unlike any seen in modern Pennsylvania history. A Republican-penned $6.6 billion no-new-taxes spending package will become law Monday, leaving Illinois as the only state still without a budget in place for the current fiscal year. In recent days, Democratic lawmakers increasingly pressured Wolf to relent on this veto threat, and some raised the possibility of voting with Republicans to override Wolf's veto and deliver a damaging political blow. Still, Wolf insisted on Wednesday that the budget remains out of balance and underfunds crucial needs, and that the state continues to need a major tax increase to wipe out a damaging long-term deficit. "What I did do is bring attention to the fact that we have this big structural deficit, we have this train wreck coming at us July 1 ... and I believe that everybody in Harrisburg now understands that," said Wolf, who refused to sign the document. That attention is a meager consolation prize compared to the governor's ambitious agenda when he unveiled his proposed budget a year ago. Allowing the spending measure to pass completes a $30 billion budget package that's similar to what Wolf previously vetoed. The budget includes a 3 percent increase in spending, but it does so without a multibillion-dollar tax increase that Wolf had sought to deliver a record boost in aid to public schools and wipe out a long-term deficit that has damaged Pennsylvania's credit rating. At one point, Wolf had negotiated a deal with top Republican lawmakers that revolved around a 6 percent spending increase and a $1-billion-plus tax increase to reverse post-recession cuts to public schools and human services and to narrow a long-term budget deficit. The deal also promised to address the state's underfunded pension, but it fell apart in December in the face of conservative Republicans who opposed a tax increase. In recent months, school officials, editorial boards and others have poured scorn on Harrisburg over the budget fight. David Wytiaz, the superintendent of tiny and impoverished Aliquippa School District outside Pittsburgh, had warned that the district would close May 1. On Wednesday, he called the situation "as dire as it could be." The Republican-penned package delivers a $200 million boost to public school aid, half of what Wolf had originally sought, and a 5 percent increase for state-subsidized universities. The sides now will have to negotiate a new, election-year budget for the fiscal year starting July 1. Top Republican lawmakers have not agreed to a tax increase.

Pennsylvania governor relents after 9-month budget impasse