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PHOENIX — Lawmakers agreed late Thursday on a combination of raiding the state's bank, cutting the budget and doing some short-term borrowing to finally bring the current state budget into balance.

The deal, which got the blessing of Gov. Janet Napolitano, essentially takes all of the easy methods of bringing expenses into line with revenues. At this point, it's estimated that the budget is $1.2 billion in the red.

And the situation could get worse if tax collections between now and June 30 are less than expected.

This package fills that gap largely by taking $487 million out of the state's "rainy-day" fund, with another $300 million coming out of special funds earmarked for other less-essential purposes. It also means no major cuts for most state agencies, although the three state universities will have to slash spending by a combined $14.7 million, with the exact split determined by the state Board of Regents.

But in agreeing to the immediate fix, Democratic and Republican legislative leaders simply deferred the more difficult decisions on how to balance next year's budget and a deficit approaching $2 billion.

In fact, one of the "budget cuts" for this year actually makes the problem worse: The state will delay $272 million it's supposed to pay to public schools in June until the following month — and the following fiscal year. That, however, just puts that obligation on top of that $2 billion shortfall.

Not everyone was happy with that prospect.

Sen. Ken Cheuvront, D-Phoenix, called this plan "irresponsible" because, he said, it relies heavily on "accounting gimmicks" and does not make deep enough spending cuts, leaving the state in a fiscally precarious position next year.

Sen. Karen Johnson, R-Mesa, called the package "pretty much smoke and mirrors."

But Sen. John Huppenthal, R-Chandler, called the measure "a good start." Most senators agreed, approving the package 24-5; the House voted 53-3 for the plan.

Despite that, a sharp divide does remain over how lawmakers will bridge next year's $2 billion gap.

Napolitano wants to save operating funds by borrowing money for school construction. In fact, her financial advisers concluded the state can borrow money next budget year not only for more than $450 million in schools to be financed then, but even $318 million for schools actually paid for this fiscal year, making that much more money available to balance next year's budget.

Many Republican lawmakers have balked at long-term bonding, which is why it is not part of this package. But even Senate President Tim Bee, R-Tucson, said Thursday that there are few alternatives. "The problem in (fiscal year) 2009 is so big we will utilize virtually every tool available to us," he said.

Senate Majority Leader Thayer Verschoor, R-Gilbert, said the big fight will be how much to borrow — which goes directly to the issue of how much to cut state spending.

But Senate Minority Leader Marsha Arzberger, D-Willcox, said there are other options, such as the "revenue enhancements" proposed by Napolitano.

Key among them is having the state collect $90 million in net new revenues from the more than 170 fixed and mobile photo radar cameras she has directed the state Department of Public Safety to order. Napolitano already has the power to order the cameras. But without legislative approval, all the proceeds from tickets would go to the cities and counties where citations are issued.

The governor also hopes to get legislative approval to shift $60 million in state prison costs to counties. And she believes more people will buy lottery tickets if lawmakers allow the agency to spend more money to advertise.

And the deal to resolve this year's budget does leave about $200 million in that rainy-day fund to plug next year's deficit.