HARRISBURG -- A year in the making, the much-debated Pittsburgh bailout package was approved by the state Legislature early yesterday, just hours before lawmakers adjourned.

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It was the final noteworthy piece of legislation that lawmakers voted on before leaving Harrisburg for the holidays, and it is arguably the most important piece of state law to be approved since the July bill legalizing slot machines. The historic bailout package will give Pittsburgh new taxing authority and, coupled with city budget cuts, will help erase next year's $77 million budget shortfall.

The bailout allows Pittsburgh to lift its occupation tax from $10 to $52 for most city workers, installs a 0.55 percent payroll tax on for-profit city businesses, phases out the 6 mill business privilege tax and reduces the city's 50 percent parking tax.

It also prevents the installation of a commuter income tax.

Count the bailout as a victory for Pittsburgh, however costly. The city's many transit riders came up losers, though, when the Legislature failed to find a way to plug the huge hole in the Port Authority's budget, even after a week of intense haggling.

Other issues of statewide interest, including a pay raise for legislators and a measure that would have allowed beer distributors to open on Sundays, also died without approval, as negotiations on a tangled web of matters broke down in the Sunday morning hours.

But it was the Pittsburgh bailout that drew most of the attention among Allegheny County's delegation of legislators, some of whom had been working on the package night and day for a week. Sen. Jane Orie, R-McCandless, said even though the new taxes would be onerous to some, they give Pittsburgh an improved chance at solvency.

"We are trying to spread the pain across the board," Orie said during a break in floor debate.

Sen. John Pippy, a Moon Republican, likened the bailout to a football game, and said that while Pittsburgh wasn't in the playoffs yet, it at least had the ball in good field position. Rep. Mike Turzai, R-Bradford Woods, said the city was to blame for its own financial mess, while Rep. Dan Frankel, D-Squirrel Hill, defended Pittsburgh, saying factors like industrial collapse and population loss had hampered the city more than any alleged mayoral mismanagement did.

Jake Wheatley, D-Hill District, closed out the Sunday morning debate, saying the new business taxes could hurt some tavern owners in his district, but urging his House colleagues to vote for it nonetheless.

Two components of the bailout package, involving the shifting of tax revenues from Pittsburgh Public Schools to the city, were approved previously, with little discussion. The linchpin tax bill was approved by the House by a 110-84 vote, around 2 a.m.

The bailout was approved in the nick of time. By law, any measure that isn't approved by both chambers before the end of the two-year legislative session dies on Nov. 30. It can't be revisited when the lawmakers return in January, and instead must be reintroduced as a new bill.

Where the Pittsburgh bailout succeeded, transit funding, pay raises and other issues failed. As happens so often in Harrisburg, when one deal collapses, other deals fall like dominoes.

Though the tally would have been close, both the House and Senate said early Sunday they'd be able to squeeze out enough votes to approve a pay raise for legislators, judges and executive cabinet secretaries, had the matter been brought to the floor.

Transit, pay raise linked

But Gov. Ed Rendell wouldn't sign off on a pay raise -- legislators could have seen their base salary increase to $79,000 from $66,204 -- until he won new funding for the state's two biggest transit agencies, both of which are experiencing deep, chronic budget shortfalls.

The transit issue, however, would have been best complemented by a gasoline tax increase, the proceeds of which would have been spread to rural road projects, and would have made the idea of voting for yet another urban bailout more palatable to suburban legislators.

But the gas tax was taboo because prices are already near $2 a gallon.

Rendell also wanted action on his blockbuster environmental package, the "Growing Greener" initiative, which proposed $800 million in cleanup and preservation spending. But that plan, along with the transit plan, was scuttled by lawmakers, and the pay raise went with it.

Slumping in a chair, an exhausted H. William DeWeese, the House Democratic leader from Waynesburg, said yesterday that the intricate mix of legislation simply wouldn't gel.

On transit issues, the Senate, followed by the House, passed a small spending bill that will send up to $6 million to the state's smaller transit agencies. But the chambers came up empty-handed for the Port Authority of Allegheny County, which has a shortfall of $30 million and is threatening to raise base fares, and for Philadelphia's Southeastern Pennsylvania Transportation Authorities, which has a $60 million shortfall.

Throughout Saturday, Democratic lawmakers and Gov. Ed Rendell continued to push for a variety of new fees on tires, car rentals and vehicle emissions stickers, to provide a funding stream dedicated to mass transit statewide. But as Saturday wore on, it became increasingly clear that Republicans in the Senate and House had no intentions of agreeing to fee increases.

On Sunday, the GOP accused Rendell of "manufacturing" a crisis to grab funding. Earlier in the week, Republicans said that Rendell could, and should, shift tens of millions from a federal transportation account, usually designated for roads projects, to the transit agencies. They suggested a figure of $54 million.

"The money's in there," said Erik Arneson, aide to Republican Senate leader David Brightbill of Lebanon. "He did the same thing last year."

The transit bailout met the same fate as Sen. Sean Logan's proposal to allow beer distributors to open between noon and 5 p.m. on Sundays.

Beer sales measure dies

Logan, D-Monroeville, pitched the measure and forced its approval in the Senate. But when the Sunday sales measure reached the House, representatives stripped Logan's language out of the larger liquor bill.

What's left is a bill that allows 25 percent of state liquor stores to keep Sunday hours, up from 10 percent. Moral objections from conservative Republicans and lobbying from tavern owners, who are the only game in town when it comes to beer, teamed to killed the bill in the House.

As for the 4-month-old slots bill, lawmakers from both parties generally agreed that an ownership provision, permitting state lawmakers and other politicians to hold up to 1 percent of a casino, was bad news. But other compromises eluded the Democrats and Republicans.

Slots changes to be vetoed

On party-line votes, the House and Senate approved a host of changes to the slots law, but Rendell has signaled that he'll veto the bill, saying it creates more problems than it solves. The amendments present "the possibility of corruption, or the appearance of corruption."

The Legislature, though it technically could return, says it is gone for good, on an early Thanksgiving break despite Rendell's plea that legislators return next week. "With [eight] days left in the session it makes no sense to rush through our agenda and adjourn," he said.

But those comments came just as lawmakers were in the process of scattering from the Capitol, bringing the 2003-2004 session to an acrimonious close.

Prior to the session's end, though, the same lawmakers who swung and missed on transit and Sunday beer sales connected on a couple of softball items during the last-minute, top-speed holiday rush.

Here's what you may have missed:

Anglers, take note -- the cost of a residential fishing license is going to grow from $16.25 to $21 a year, almost a 30 percent increase. For out-of-state fishermen, the cost grows from $34.25 to $51. Boating license fees, which vary depending on the size of the craft, also will increase by 30 percent.

The fee increases are forecast to raise an extra $7 million annually for the Pennsylvania Fish and Boat Commission, which is facing increased maintenance costs but a declining number of anglers each year.

The House and Senate passed the measure, and it's awaiting the governor's signature.

Lawmakers approved an updated version of Megan's Law, requiring state police to post information about convicted sex offenders on the Internet.

"If the public is provided adequate notice and information about sexually violent predators and certain other offenders, the community can develop constructive plans to prepare themselves and their children for the offender's release," said outgoing Auditor General Robert P. Casey Jr., who has been lobbying for the update since this summer.

An energy plan, which requires at least 18 percent of the state's energy to come from alternative sources, like wind and solar power, by 2020, was approved. The plan, called the "Alternative Energy Portfolio Standards Act," will be signed by Rendell.

The Legislature agreed to a one-year extension of a subsidy program that helps Pennsylvania's doctors pay for their medical malpractice insurance. That means the relief package, which would have expired next year, now runs through 2006.

Doctors must carry, at minimum, two types of insurance -- at least $500,000 in coverage from a primary carrier, and another $500,000 in coverage from the state's MCARE fund. Under the extension, high-risk specialists can skip their MCARE premiums, while all other doctors see a 50 percent reduction.

Both chambers also approved a plan to spend a quarter-billion-dollar loan fund that aids towns in replacing old water and sewer lines and building new ones. The loan fund was approved by voters last spring.