Topeka ? Gov. Bill Graves said Friday he’s willing to tap into the state’s rainy-day fund to help strike a deal with lawmakers to fix a $700 million budget hole.

But, he said, he will not back off his proposal to raise the state cigarette tax by 65 cents per pack.

At his weekly news conference, the Republican governor also chastised the GOP-dominated Legislature for failing to make better progress on the state’s budget troubles.

With the regular legislative session set to end next week, the House has adopted a budget that is $130 million out of balance, and the Senate has yet to produce a spending plan.

Told a Senate committee met Friday but failed to advance a tax package, Graves said, “It has just astounded me that there is a lack of urgency in their work. The things that they (lawmakers) have produced have not been of great significance. The issue is the budget.”

And on that issue, Graves said he was willing to compromise.

“Everyone is going to accept things they don’t like,” he said.

In the past Graves has vehemently opposed reducing the statutory requirement that the state end its fiscal year with 7.5 percent of revenues in the bank  the so-called rainy-day fund.

The governor has said reducing the ending balance could create cash-flow problems. Several plans proposed by the Legislature would set the ending balance at 5 percent, freeing $104 million for other needs.

Graves said he would not bend on his proposal to raise the state cigarette tax from 24 cents per pack to 89 cents per pack, producing about $110 million per year.

“The public supports it,” he said. “It has positive health implications, and it produces some money we need in an ongoing fashion.

Sen. David Corbin, the Towanda Republican who heads the Senate tax committee, offered a $332 million plan Friday that would raise the sales tax to 5.25 percent from 4.9 percent on June 1 but phase out the tax for groceries in a three-year period starting in 2004. It would increase the cigarette tax by 26 cents a pack, to 50 cents, and raise the tax on other tobacco products to 12 percent from 10 percent.

The Corbin plan also would increase the gasoline tax to 24 cents a gallon from 21 cents and the diesel fuel tax to 26 cents from 23 cents, starting June 1. Registration fees for cars would increase $2, to $27 a year; it would be higher for trucks. But Corbin adjourned his committee after learning a majority of its members were ready to vote his plan down.

Lawmakers are hurtling toward the April 13 end of the regular session and have approved a resolution to set a wrap-up session that starts May 1. Legislative leaders have said they hope that session will last no more than four days.

Senate President Dave Kerr, R-Hutchinson, said he expected the Senate to adopt a budget next week so that House and Senate proposals could be put into a conference committee to work on the differences.

The House budget would increase aid to public school districts by $10 per student, while the Senate plan would keep state aid to school districts at the same level.

The House budget reduces funding to higher education by nearly 13 percent, while the Senate plan keeps funding at the current level.