By Dave McKinney

SPRINGFIELD, Ill. (Reuters) - Just days before the end of the Illinois legislature's spring session, the governor said on Sunday he would veto a House-passed budget, which includes school funding, and fired back at an angry Chicago mayor.

Lawmakers face a midnight Tuesday deadline to pass a fiscal 2017 budget and adopt a 2016 spending plan that has remained elusive for the past 11 months, leaving Illinois as the only state without a complete budget for the fiscal year ending June 30.

The impasse between the Republican governor and Democrats who control the legislature showed strong signs of extending into fiscal 2017, with Bruce Rauner pushing for pro-business and anti-union reforms and Democrats in the House of Representatives last week passing a spending plan short about $7 billion in revenue.

Adding fuel to the fire was Rauner's veto on Friday of a bill allowing Chicago to spread out payments to its public safety workers' retirement systems as the city struggles with a structural budget deficit and other pension woes.

Mayor Rahm Emanuel on Sunday chastised the governor's "callous decision," saying it would lead to a $300 million city property tax hike at the same time Rauner wants local property taxes capped.

Rauner, who needled Emanuel for not coming to the capital, Springfield, to address the city’s pension-driven financial woes, called the bill "terrible policy," saying it would cost Chicago taxpayers $18.6 billion more over the next 30 years by not fully funding pensions.

"Where is the mayor? He's not here, He's not asking for real reforms," Rauner told reporters outside his office.

He also confirmed previous statements from his staff that he would veto the House-passed budget if it was approved by the Senate. He urged lawmakers not to hold schools "hostage," by sending him a clean bill to fund K-12 public schools. He also asked Democrats to break from longtime House Speaker Michael Madigan.

"The speaker is perfectly fine having deficit spending and borrowing. He’s perfectly fine crushing the economy, crushing our taxpayers. He’s been fine with it, and we need his members to say: 'No, Mr. Speaker, no more,'” Rauner said.

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Madigan said his members were prepared to be in continuous session through the summer, blaming Rauner for injecting non-budget demands into the process.

“We’ll be here (Monday), Tuesday and through the remainder of the summer,” he said.

Passing a budget beyond Tuesday's deadline will require tougher-to-get three-fifth majority votes in each chamber.

(Additional reporting by Karen Pierog; Editing by Peter Cooney)