Reports that the Legislature is dismayed about how Governor Pataki submitted his budget have raised the possibility that a budget agreement will not be reached by the constitutional deadline of April 1.

The Governor submitted a budget this year that would grow by less than the rate of inflation--a step that immediately led to promises that the Legislature would add significant spending to the package.

Last year the Governor used his constitutional powers of line-item veto to kill some $760 million in spending added by the Legislature. He has indicated that he will use his veto power again this year if necessary to restrain spending.

But there is a dispute over whether the Governor can veto only specific dollar amounts in appropriation bills, or whether he can also veto legislative changes in the separate bills that contain formulas for programs like Medicaid. This year, the Governor has tried to deal with that by submitting bills that "bundle" appropriations with underlying formula language.