PITTSBURGH -- State lawmakers and business leaders met Friday to look for solutions to Pittsburgh's budget crisis.

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They discussed a plan that would require the city to cut its spending before the legislature allows the city to impose new or increased taxes.

City Controller Tom Flaherty said, "We can no longer afford to have a civil war. (We) can't have this pitched battle between the city and the suburbs."

State Rep. Don Walko, of the North Side, wants to introduce a regional revenue sharing plan to solve the financial problems of major cities.

Since the Charities Act of 1997 became effective, many institutions like colleges, hospitals and sports stadiums get money from the state but have tax exempt status.

"I believe the city was getting roughly $7 million from institutions like the University of Pittsburgh, hospital and other entities. Now, it's down to $700,000," Walko said.

Flaherty said, "Only 4.7 percent of the budget for the city of Pittsburgh comes from the state. That is disastrous."

Flaherty said if 2 million acres of state game lands is exempted from taxes and gets a state subsidy it's time places near the 14 state-related colleges get subsidies to help their property tax problems.

"The small colleges are expanding and taking property off the tax rolls," Flaherty said.

Walko said Pittsburgh Mayor Tom Murphy and legislators from places like Lancaster, York and Johnstown support his regional tax exempt grant project.

Currently, local lawmakers are working on a bipartisan bill that would create a budget control board with the power to make reductions.

The board would have to be in place before any new taxes are approved.