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NH budget talks opening

CONCORD, N.H. (AP) -- New Hampshire House and Senate negotiators are opening talks on a $10.7 billion budget for the two years beginning July 1.

The two chambers agree on a number of spending priorities, including increased funding for higher education and services for the disabled and mentally ill. But they disagree on how to pay for spending. The Republican-led Senate rejected a 20-cent increase in the tobacco tax and delaying implementation of tax breaks for business. The Democratic-controlled House does not like a $50 million Senate-proposed cut in staff and benefits.

The House also proposes expanding Medicaid to an estimated 58,000 poor adults under the federal health care overhaul law. The Senate wants to establish a commission to study the issue.

Talks begin Friday. The deadline to reach a compromise is Thursday.