Could an increase to minimum wage lower the chances of an on time budget? Capital Tonight's Nick Reisman has the story.

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ALBANY, N.Y. -- “We have a deal. We're going to keep talking. That's the deal,” Assembly Speaker Sheldon Silver said.

For the second day in a row, legislative leaders met privately with Governor Andrew Cuomo for about an hour and emerged to say very little about the negotiations over locking down a budget deal. But lawmakers and the governor are optimistic that a deal can be reached this week and a spending plan passed ten days before the April 1st deadline.

“We're going to look to narrow down some of the issues, work our way toward table targets and have a budget passed next week,” said Senate Republican Leader Dean Skelos.

Governor Cuomo said, “The ideal never happens. But that would be the ideal plan.”

Sticking points do remain at the Capitol, especially over increasing the state's minimum wage. Cuomo backs a plan that would hike the wage from $7.25 to $8.75, while the Assembly passed a bill that would raise it to $9 and then index it to inflation. The Senate's budget is supportive of a raise, but does not have any details. Cuomo insists that despite the negotiations not focusing on the wage issue doesn't mean it won't ultimately be in the budget.

“Just because we haven't had a conversation, the time frame here is a little misleading. We have, you want to call it a week-ish, but in terms of this negotiation, that's like all the time in the world,” Cuomo said.

As lawmakers debate the minimum wage, Senate Republican Leader Dean Skelos says he's starting talks on more than $2 billion in tax cuts aimed at middle class families and businesses.

Skelos said, “We're starting to discuss tax cuts also.”

“And is the Speaker open to that?” our reporter asked.

Skelos replied, “You'll have to ask him.”

Lawmakers in both houses, meanwhile, want to restore $120 million in cuts to mental health programs made by Cuomo in part to plug a $500 million gap created by a dispute with the federal government over Medicaid overbilling.

“We're not going to balance the budget on the backs of those with developmental disabilities. That's extremely important. We have to know our history. We have to make sure these service providers that's their mission to do,” said State Senator David Carlucci.

Locking down the state budget with a tentative agreement this week would allow bills to be printed over the weekend. That way, Cuomo won't have to issue a message of necessity to waive the three day aging process