For the second time in three years, Pennsylvania has been unable to pass its budget by the start of the new fiscal year, which means state workers can't be paid and welfare recipients won't receive their checks.
The impasse is over a 2-cent increase in the state gasoline tax supported by Gov. Dick Thornburgh, a Republican.
The rise would make Pennsylvania's tax 11 cents per gallon, one of the highest in the country.
Many legislators are reluctant to vote for the tax increase with gas lines winding for blocks -- an odd-even rationing plan went into effect in the state Thursday -- and gas prices soarring.
Thronburgh wants a gas tax increase to help fund a $202 million program to repair state roads damaged by last winter's harsh weather.
The fiscal year began today with the politically divided legislature dead-locked over the budget and taxes.
Two years ago, the legislature haggled until August 20 before approving a budget and that wasn't unusual.
Budget crises are endemic to Pennsylvania. This year is the 11th in the last 17 that a budget has not been enacted by July 1.
A tax package aimed at resolving this year's deadlock passed the democrat controlled state Senate with bipartisan support last Wednesday. The package included the gas tax increase and a continuation of temporary income and corporate taxes passed during the 1977 budget fight.
But in the House of Representatives, which the Republicans control by 103 to 100 seats, the tax bill lost when it was opposed by Democrats and a handful of Republicans who broke party ranks.
The deadlock has been exacerbated by the bitterness created two years ago, when Democrats controlled the legislature and Republicans refused to support the budget.
Thornburg has said he will not sign a temporary "stopgap" appropriation to keep the state running. So the state lost its ability to spend money at 12:01 a.m. today.
That means 107,000 state employes face payless paydays and Pennsylvania's 848,000 welfare recipients will get no checks.