HARRISBURG -- The state's highest-ranking lawmakers met privately yesterday to hash out a property tax relief plan, but they emerged after 90 minutes with no clear agreement.

The House and Senate have vastly differing ideas about how to give homeowners a break on school property taxes.

The frontrunner of several plans vetted in the House would offset property taxes by increasing the personal income tax rate from the current 3.07 percent to 3.29 percent and expanding the state's 6 percent sales tax to include professional services, candy, toiletries and more.

Gov. Ed Rendell is hoping to sign a bill that looks more like the Senate version of property tax relief.

The Senate plan would allow voters in 498 of the state's 501 school districts to decide whether to shift taxation from property to wages while limiting school boards' ability to increase their budgets beyond the annual rate of inflation.

No referenda would be held in Pittsburgh, Philadelphia or Scranton, where wage taxes already are the highest in the state. Those cities still would benefit from other parts of the bill, including anticipated gambling revenue and expanded tax rebates for low-income seniors.

The Senate bill was designed to save homeowners at least 18 percent on property taxes.

"I would enthusiastically sign that," Mr. Rendell said yesterday after meeting with House and Senate leaders from both parties. "I could also sign a bill that would give deeper cuts."

Agreement between the two chambers could take a compromise that would include a limited version of the House's proposal to expand the sales tax, the governor said. He would not speculate on which new items might become taxable.

"The House has to decide what it is willing to discuss and then talk to the Senate," he said.

Stephen Miskin, spokesman for House Majority Leader Sam Smith, R-Punxsutawney, said anything could happen.

"The meeting [yesterday] was cordial. The Senate leadership, House leadership and governor got to see where everybody was at. Now we've got to talk to the members," Mr. Miskin said.

House caucuses are planned for today and a vote could come by day's end.

"There is absolute agreement that we have to do something before we go home" for the holidays, Mr. Rendell said.

The Senate plan

Estimated property tax reduction:
Varies by school district from 18 percent to 50 percent by providing tax exemptions for 35 percent of median home values in each community. Provides for further reductions as gambling revenue becomes available.

Taxes that would increase:
Earned income tax rate would increase by up to 1 percent to replace property tax loss dollar-for-dollar. Amount would vary by school district.

Contingent on voter referenda?
Yes. Bill provides for a referendum to be held in each school district.

The plan also would:
• Use gambling revenue to increase the number of seniors receiving rental rebates of $250 to $500 annually.
• Allow school boards to refuse to accept gambling money. Residents can overrule board members at referenda.

Proposed by:
• Majority Leader David Brightbill, R-Lebanon
• Minority Leader Robert J. Mellow, D-Scranton

Support in chamber:
The Senate passed the plan Thursday, 48-2.

The view from the other chamber:
House members say the Senate plan doesn't provide enough property-tax relief.

The view from the governor's office:
The governor said he would be willing to sign the Senate bill, but first the House has to agree. Mr. Rendell would support a compromise that includes a slight broadening of the sales tax base, he said.

The House plan

Estimated property tax reduction:
Average of 40 percent. Could increase to an average of up to 48 percent after 2007 when gambling revenue begins rolling in.

Taxes that would increase:
Sales tax collection rate would stay the same but more items would be taxed such as candy, dry cleaning and toiletries. Personal income tax would increase from 3.07 percent to 3.29 percent.

Contingent on voter referenda?
No.

The plan also would
Use gambling money to allow low-income seniors to receive rental rebates of up to $750.
Require voter approval for school budget hikes that exceed the annual rate of inflation.

Proposed by:
• David Levdansky, D-Forward
• Kerry A. Benninghoff, R-Centre
• Mario M. Scavello, R-Monroe

Support in chamber:
The House vetted the plan along with some 20 others during a 10-hour "committee of the whole" meeting last week. The plan was a top vote-getter in nonbinding straw polls.

The view from the other chamber:
Senators don't want to expand the sales tax.

The view from the governor's office:
Gov. Ed Rendell said yesterday that he would not sign any legislation that would increase the sales tax rate.