Democrats and Republicans in the state legislature are fighting over the state budget for the next two fiscal years, with signficant funding to New Haven at stake.

The Democrat-controlled Appropriations Committee voted Monday for a budget proposal that would increase spending to $434 million above the state’s constitutionally-mandated spending cap, prompting Republican Gov. M. Jodi Rell to immediately announce she would veto the bill. The additional spending includes a $79 million increase in municipal aid, including local education funding, relative to the budget Rell proposed in February.

Rell’s proposal crossed the constitutional spending cap by $190 million in funding to assist state nursing homes and nonprofit agencies. In a press release issued yesterday, Rell said this was the only funding above the spending cap that she would consider.

“The chairs of the Appropriations Committee said the spending cap is a ‘guide,’ not a ‘straitjacket,'” Rell said. “They have it exactly backwards. The spending cap is written into the constitution to protect the taxpayers and restrain the kind of outrageous, runaway spending contained in this budget.”

Rell spokesman Rich Harris said though the governor will not consider any bill that breaks the spending cap further than the $190 million in the governor’s proposal, Rell welcomes input and is eager to forge a compromise with legislators.

Rob Smuts ’01, deputy chief of staff for Mayor John DeStefano Jr., said the city is still processing the information in the proposal, but the total funding to New Haven could be roughly $6 million over Rell’s budget. Rell proposed a $1.8 million increase in aid to New Haven, while the city requested a $9 million increase.

“It doesn’t put us back to square footing from the sort of real cuts that we’ve had in the past couple of years from the state, but it’s definitely a step in the right direction, and we think it’s a pretty good budget,” Smuts said. “The trick will now be supporting our allies in the legislature and making sure the governor understands why this needs to pass.”

Smuts said the city will work to lobby legislators in support of the Democratic budget proposal, including a “New Haven Day at the Capitol” bus trip planned for Thursday in which city leaders and constituents will lobby for the city’s interests in Hartford.

Republican state Rep. Alfred Adinolfi, a member of the Appropriations Committee, said he doubts there is sufficient support for the bill to override a Rell veto, so a compromise will have to be forged. In addition, he said it is unclear whether it is even legally possible for the state legislature to cross the constitutional spending cap against the governor’s will.

“We have a $1.6 billion deficit, and then we’re coming in and increasing the next budget by 10 percent,” he said. “[The Democrats are] just trying to find loopholes to go over the cap.”

Smuts said though it is important for the state government to limit its spending, taxpayers would have to shoulder the burden of lower state aid in higher local taxes. DeStefano’s city budget for this fiscal year includes a property tax hike to cope with a city budget deficit.

Ward 1 Alderman Ben Healey ’04 said he is not yet familiar with the details of the budget proposal, but that the city’s current priorities include maintaining public services, in particular education, and limiting the property tax burden on homeowners.

The budget passed by the Appropriations Committee also includes spending increases of $110 million to safeguard prescription drug coverage for the needy, $120 million for a two-year extension of health care coverage under Connecticut’s HUSKY program, and funding to create a state Commission on Aging.