ST. PAUL-Transportation funding appears to remain the main hurdle to a special legislative session to fund Minnesota public works projects and fix a tax bill.

A meeting of House and Senate public works negotiators Tuesday failed to produce any sign they are closer to agreement than when their regular session ended last month.

Legislative leaders and Gov. Mark Dayton plan to meet Wednesday to see if they can agree on public works funding legislation in a special session this month.

Since House and Senate leaders could not pass a transportation funding plan before the regular session, transportation projects were merged into a public works bill that failed minutes before the regular session ended.

Tuesday's testimony proved, to no one's surprise, the key to passing a transportation-public works bill likely will be whether Democrats and Republicans can compromise over funding a new passenger light rail project in the southwestern Twin Cities. Democrats support it, while Republicans strongly oppose it.

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"It is this very issue that does not allow us to get to a successful special session," Rep. Alice Hausman, D-St. Paul, said.

Even though Republicans oppose southwest light rail, Senate Majority Leader Tom Bakk, D-Cook, said senators will not pass a bonding bill without light rail funding. It is that impasse that leaders and the governor likely will discuss Wednesday.

"The southwest line ... is widely supported by businesses in that area of the state," Sen. Katie Sieben, D-Cottage Grove, said.

Rep. Paul Torkelson, chairman of the House bonding committee, said he briefly saw a proposed amendment late in the session to allow Hennepin County to attract federal funds for the light rail project.

"It was dismissed by me," the Hanska Republican said, adding that his leaders said it was not part of any agreement with Democrats who control the Senate.

Tuesday's meeting was called to discuss public works projects, which generally do not include state transportation.

Dayton, a Democrat, and House Republicans have not been able to agree on how much to spend on public works projects, or what should be funded. The governor said the two sides cannot even settle on a number halfway between the two proposals.

"If we can't even agree on simple math, how can we agree on anything?" Dayton said on Minnesota Public Radio.

One top state official called Wednesday's governor-legislative leader meeting "life and death" for a special session that would be needed to approve public works projects, to be funded by the state selling bonds, and fix a vetoed tax bill that contained a one-word, $101 million mistake.

Dayton, the only person who can call a special session, has said it should happen this month.

Before calling a special session, the governor insists on adding $183 million in bonding projects "because I was not involved in decisions made at the last minute on the bonding bill."

Prime on Dayton's list are a new University of Minnesota health facility, a Bemidji State University building and more money to repair Minnesota State Colleges and Universities system buildings.

The bonding bill negotiators discussed Tuesday was nearly $1 billion, including a range of projects such as grade-separated railroad crossings in Moorhead, Red Wing and Coon Rapids; almost $190 million for higher education facilities; $11.6 million for flood fighting; $272.8 million for transportation; $93.5 million for economic development projects; and $154.9 million for water and sewer treatment.

Ron Harnack, representing the Red River Watershed Management Board, told the committee that it was unfortunate that the bonding bill specifies certain projects would get state funding, even if they did not apply to the Department of Natural Resources flood program.

For instance, he said, the bill would give Ortonville $1.8 million for a flood-control project, but the city did not seek it from the DNR. At the same time, the bill does not include $3.2 million for Montevideo, which is on the DNR list.

Harnack said that flood-prevention efforts have been successful over the years when the DNR list has been followed.