EDINBURG - Hidalgo County's former elections administrator may be close to working out a deal that would end the year-long theft case against her, attorneys for both sides said.

During a court hearing Tuesday, prosecutors said they had offered to drop the 12 felony counts against Teresa Navarro to a Class B misdemeanor charge. In exchange, she would agree to accept responsibility and pay restitution for money that was allegedly stolen through misuse of county credit cards and forgery of car rental receipts.

However, her lawyers have been unable to reach an agreement with the state on a possible punishment for the crime.

Navarro's camp has pushed for the ex-administrator to receive deferred adjudication, a sentence that would allow her to avoid jail time and a black mark on her record should she successfully complete a probationary period.

A clean record would make it easier for her to find employment and pay back the missing county funds after the resolution of her case, state District Judge Rudy Delgado said Tuesday while urging both sides to strike a deal.

But prosecutors have thus far insisted on a conviction. If Navarro were to plead to the misdemeanor charge, she could face up to six months in jail - far less than the maximum sentence of life in prison that she faced with the felony charges.

Navarro, 49, resigned her post in June 2007, after a grand jury indicted her and three of her former employees on charges of tampering with public documents and engaging in organized criminal activity.

Investigators allege the foursome stole $8,000 in county money by forging receipts for cars that had been rented for personal use.

Navarro and her former department operations director, Rene Solis, faced subsequent charges of allegedly using county credit cards to pay for as much as $20,000 in personal items such as clothing, extravagant meals and hotel rooms.

Solis's attorney, Al Alvarez, said Tuesday that the state had not yet offered his client a plea deal but that he expected an offer with similar terms could be forthcoming.

"A lot of discussions have been preliminary," he said. "But they haven't offered anything to us officially yet."

Judge Delgado gave the parties until August to continue their negotiations.