SPRINGFIELD - Unable to agree on how to fix a $12 billion budget hole, state lawmakers voted Wednesday to spackle on a patch by borrowing billions to keep the government open and put off decisions - if not a tax increase - for at least a few more months.

The state will borrow $3.5 billion, to be paid back with interest over five years, to make required pension payments and restore a sizable chunk of funding for local social service agencies that care for the elderly, disabled and needy in a $26 billion budget. Trying to find dollars wherever possible, the state would also refinance debt and raid special state accounts to come up with another $1 billion.

There's a dozen furlough days for lawmakers that'll save thousands, and there'll be nearly $2 billion in cuts likely to include thousands of state layoffs.

"I still think we could have done this considerably better," said state Sen. Matt Murphy, a Palatine Republican weighing a run for governor next year.

The moves brought to a close the marathon legislative session that blew past its May 31 deadline but did little to resolve lingering budget problems that increasingly threaten state finances year after year.

Most notably the deal does not reduce the massive, multibillion-dollar backlog of bills piling up in the comptroller's office. Rather, the budget plan counts on continuing to delay more than $3 billion in payments in order to make the numbers balance.

That means unless lawmakers revisit the budget in the coming months or there's an economic turnaround of gigantic proportions, there'll be yet another massive hole in next year's spending plan.

State Rep. Jack Franks, a Marengo Democrat considering a run for governor, criticized the borrowing and the timing.

"This is nothing more than smoke and mirrors. We cannot continue to put off the cuts that we need to do," Franks said. "We're going to be in worse shape than before we got here."

Senate President John Cullerton, a Chicago Democrat, said there'll be another tax increase vote in January. He predicted Republicans would support it rather than continuing to not pay businesses and borrowing.

"We will come to the end of the line," Cullerton said.

Republicans, the political minority in Illinois, considered this budget a win for them.

"It avoids chaos. It avoids a tax increase," said Senate Republican leader Christine Radogno of Lemont, who voted for the budget. She called it the "best of a number of bad solutions put before us."

Budget negotiations had strained relations between Democratic Gov. Pat Quinn and lawmakers. Despite the shortfalls, including a tax increase he wanted, Quinn applauded their efforts and signed this budget Wednesday night.

He offered little information on where cuts would be made and said he believes he still is in good position to launch a bid to keep the office he inherited upon the impeachment and ouster of Rod Blagojevich earlier this year.

"Yes, I think I'm doing a fine job," Quinn said.

Privately, many lawmakers on both sides of the aisle agreed a tax increase is inevitable and the massive cuts needed to balance spending are impossible. But proposals to raise taxes - and trim spending - have repeatedly been defeated, leaving the state in a financial limbo that sent the state into a new budget year July 1 with no budget.

The absence had begun to threaten paychecks for state employees who'd been told to keep showing up to their jobs despite the impasse.

For now, lawmakers head back to their home districts with campaign season about to begin. By putting the tax increase debate off until January, it means lawmakers will know whether they're facing a primary challenge in February and possible opponents in the 2010 general election.

It also means Democrats could rely on their numbers alone to pass such an increase, though Democratic leaders have been unable to do so thus far.

After the May 31 deadline was missed it meant any deal needed support from 60 percent of the House and Senate, and that brought the minority Republicans into play. In January, the margin reverts back to a simple majority.

Budget: Lawmakers still see tax hike coming