Raleigh, N.C. — The Fourth of July break was the latest obstacle to the passage of a new state budget. With little compromise reached during two weeks of discussion, lawmakers weren't scheduled to return to negotiations until Tuesday.

"We've kind of jumped the track right now. We're not getting along very well with one another," Senate Majority Leader Tony Rand said.

The House and Senate are trying to erase a projected $4.6 billion deficit and agree on how to raise $1 billion in new revenue. The revenue side of the equation has proved to be the most contentious point of the debate, with the House calling on increases to sales and income taxes and the Senate seeking new taxes on many services.

Gov. Beverly Perdue last week demanded a new budget, saying the state was losing $5 million a day by operating on a continuing resolution.

Legislative budget analysts said Monday that the governor's math doesn't add up because the continuing resolution the General Assembly approved to keep state government running specifies that spending needs to be kept at 85 percent of previous levels.

"If we had tax credits or tax increases going into effect on July 1, it would be costing us, but we didn't," House Majority Leader Hugh Holliman said.

In the House plan, some additional taxes are planned for Aug. 1, but the majority of them would be effective in either October or January.

"I think she's trying to light a spark under all of us over here, but I really don't think we need a spark. I think we know we need to get the job done," said Holliman, D-Davidson.

Perdue's office declined to provide a breakdown of how the governor arrived at the $5 million-a-day figure.

Holliman said House leaders gave Senate budget writers a budget proposal and are waiting for a counter-offer to restart negotiations.