…but the recession is over.
By Kenneth Lovett | NY Daily News Albany Bureau Chief
Groll/AP -- Gov. Paterson will propose $2.5 billion budget cuts Thursday - mostly in health and education - to close a mushrooming deficit the controller says could balloon to a $4.1 billion.
Wednesday, October 14th 2009, 4:12 PM -- ALBANY - Get ready for more pain in the wallet.
Gov. Paterson will propose $2.5 billion budget cuts Thursday - mostly in health and education - to close a mushrooming deficit the controller says could balloon to a $4.1 billion.
Asked to describe the latest round of proposed budget cuts, Paterson had a one-word answer: "Pain."
The governor's cuts are expected to hit health care and education portions of the budget particularly hard, sources said.
Paterson's budget office met with legislative leaders Wednesday morning, but sources said lawmakers had no concrete proposals.
The Republican minorities in the Senate and Assembly offered suggestions. Paterson says he wants to call the Legislature back soon to deal with the budget problem - and he criticized lawmakers who want to wait until the spring.
"They should go run the Mets or something," he said. "They should not be in a situation where they are managing based on fiscal policy. This is a problem for right now and right now we have got to keep our economic condition stabilized."
Meanwhile, Controller Thomas DiNapoli told reporters this year's $3 billion projected deficit could grow to $4.1 billion if no action is taken.
DiNapoli raised the spectre of dipping into the state's reserves sooner than expected. "The spending promises made in the spring are not sustainable in the face of fallen and declining revenue," he said.
"The tough decisions that should have been made in April (when the budget was adopted) will now be harder."
The weak economy and the state's high unemployment rate has caused substantially lower-than-projected revenues from the personal income tax and the state sales tax. Even as Wall Street has rebounded and some are anticipating record bonuses this year, Paterson and DiNapoli warned it likely won't be enough to help right now.
Still, as bad as things are, DiNapoli said he has had no discussion with the state's rating agencies about possible credit downgrades nor does he intend to follow California's lead and hand out IOUs to creditors.