Negotiations on a deal to overhaul the state's water system aren't likely to climax until the waning hours of session on Friday.

That much was made clear Monday, when Democrats said they will not include a water bond as part of a package of policy changes that a special committee must vote on by 5 p.m. Tuesday.

"We do have a 5 o'clock deadline tomorrow for signing a conference report, and we have until Friday at midnight to potentially complete the whole package," Senate Leader Darrell Steinberg, D-Sacramento, said at today's meeting of the 14-member Senate-Assembly water conference committee.

Democrats are pushing for an independent council that would oversee operations in the Sacramento-San Joaquin Delta, a concept endorsed by a Schwarzenegger-appointed delta study group. Republicans are concerned that the council would have too much power and could potentially sidetrack planning for a proposed canal to move water around the delta southward.

Water contractors, Gov. Schwarzenegger's aides and leading Republicans and Democrats spent much of the weekend in closed door meetings in an attempt at compromise. But so far, no deal has been reached on that issue, or several others that could be part of the final package -- potentially including new conservation rules and groundwater monitoring.

It is unclear what Democrats will put before the committee tomorrow. Because it won't include a bond, Assembly Member Jim Nielsen, R-Gerber, said there's a "high probability" that the panel's six Republicans won't vote for it. The bills could clear the panel if all eight Democrats voted yes, but a bond would require Republican votes on the Senate and Assembly floors.

Republicans are pushing for a $12.4 billion bond for water projects, including up to $4 billion for dams. Democrats seem to favor a smaller bond that could be balanced with user fees, although there is a faction of Latino Democrats who say they will not support any package that does not include money for water storage.

Republicans took some comfort in a commitment by Steinberg that he would not seek a floor vote on water legislation unless it included money.

"In the end, nothing moves off our respective floors unless there is a comprehensive finance plan that goes together with all the policy," he told the committee.

But Nielsen said that even if Republicans liked the final bond proposal, that they would not put up their votes for the deal if they had concerns about the legislation to form the council. And he said he was still in the dark on what Democrats were drafting.

"We don't know what the hell is being put before us and if we don't get what we want in it, we don't vote for it," he said.

Said Sen. Dean Florez, D-Shafter: "Nobody should have any doubt where the Democrats stand. We are looking for the deal that gets us water supply improvements and ecosystem improvements that are real and affordable."