LANSING - The Democrat-led state House yesterday quickly scuttled voting on a measure that would have placed a sales tax increase proposal before Michigan voters in January after it became clear there was not enough bipartisan support to advance it.

The proposal to raise the sales tax from the current 6 percent to 7 percent would need the approval of two-thirds of the members of both the House and Senate to make the Jan. 15 presidential primary ballot. The measure would need 74 votes to clear the House, where it had the support of only 50 members - and no Republicans - before the voting process was stopped.

State funding for the University is uncertain as the deadlock over the budget continues.

Michigan's new fiscal year begins Oct. 1. So far, there has been no resolution on how to address a projected $1.7 billion deficit in budgets that fund K-12 schools, universities, prisons and dozens of other state services.

State funding makes up about 24 percent of the University of Michigan's general fund.

The state withheld its August payment of $29.6 million to the University because of lower-than-expected revenues, forcing administrators to put off payments into the University's endowment.

The Democrat-led House and Republican-led Senate appear to be going their separate ways on reaching a solution to the deficit, although eventually they'll have to reach some consensus if a partial shutdown of government services is to be avoided. A major sticking point is agreeing on how much money needs to be raised, and how much could be covered by government restructuring and other cost-cutting moves.

Lawmakers' efforts to avoid a state budget crisis continue to get tripped up on the question of raising taxes.

And that sets up another showdown over tax issues for the budget year that starts Oct. 1 when the Legislature reconvenes Friday.

The sales tax increase proposal would give voters a chance to replace other income tax and service tax increases that the House may vote on Friday.

"Our plan is to stay in session until we get this problem solved," said House Speaker Andy Dillon, a Democrat from Redford who wants a clearly bipartisan, long-term budget solution. "If it means going back to the ballot initiative, we'll do that ... we'll stay until the job gets done."

Senate Majority Leader Mike Bishop, a Republican from Rochester, had mentioned the sales tax increase going before voters as a possible part of an overall budget fix. But if Republicans were going to support that concept, it was to be targeted to the November ballot - not the January election, which would come more than two months later. The deadline to make the November ballot passed last week.

"It doesn't address the present budget shortfall," Bishop said of putting the proposal on the January ballot, which means that even if voters approved it new revenues wouldn't kick in until March. "There was really no reason to do it except to try and prove a point, and I'm not really sure what the point was they were trying to prove."

The time left to adopt a new budget for state government may be a little shorter than some lawmakers realized. A memo from the House Fiscal Agency suggests lawmakers must act before they adjourn Sept. 27 to have an official budget in place by October.

That would allow time for the state's Office of Financial Management to pay bills without violating the state constitutional provision prohibiting payments without an appropriation.

Bishop and Dillon huddled briefly on the Senate floor after yesterday's legislative sessions had ended.

Bishop said the House appears to be gridlocked and operating in "an environment of fear" over the budget crisis. Senate GOP leaders say they are poised to vote on more than $1 billion in cuts if the House doesn't send over a tax increase proposal soon.

Rep. Craig DeRoche, the top Republican in the House, said his party didn't support the sales tax vote yesterday because it did nothing to balance the state's budget by the Oct. 1 deadline.

In addition to the sales tax ballot initiative, it is likely the House will vote tomorrow on a proposal to at least temporarily raise the state's income tax. The most probable scenario would be a proposal that raises the income tax from its current 3.9 percent to 4.4 percent or 4.6 percent, the same rates that were in place in the 1990s.

Another possibility is a sales tax on some types of services. That might include a tax on sporting event and concert tickets, a proposal that sparked a radio show protest at the Capitol on yesterday afternoon.