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New York Governor Paterson Tells Lawmakers He Wants Vote on Stalled Budget

New York Governor David Paterson said he’ll ask lawmakers for a “simple up or down vote” today on his plan to close a $9.2 billion deficit in a budget that’s four weeks overdue.

Paterson, a Democrat, said a decision on the $135.2 billion spending program that he proposed in February would help schools and hospitals waiting to learn how much state aid to expect. Voters across New York will go to the polls May 18 to decide on local school budgets.

“I’ve been waiting on the Legislature to agree on their own plan,” Paterson, 55, said at a press conference in Albany yesterday. “That’s not working.”

New York, whose fiscal year began April 1, is operating on week-to-week emergency spending bills to pay workers wages and other legally required outlays. Future appropriations will include one-day-a-week unpaid furloughs for about 100,000 workers to save about $30 million weekly, Paterson said.

Paterson’s proposal “jumpstarts the budget process after there’s been clearly a lull or stalemate,” Assembly Speaker Sheldon Silver, a Manhattan Democrat, told reporters after the governor’s address. However, a quick vote that turns down Paterson’s budget “doesn’t serve any purpose,” he said.

The Senate and Assembly have agreed on $6 billion of spending cuts and additional revenue, legislative leaders have said, while declining to identify the areas of agreement.

“It would jeopardize the negotiation if we were to go into specific detail,” the Senate finance committee chairman, Carl Kruger, said April 26.

‘Very Critical’

The talks, involving representatives from the Senate, the Assembly and the governor’s office, “are in a very critical stage,” Kruger said.

Democratic Senate Leader John Sampson of Brooklyn said earlier this month he favored a still-incomplete plan that rejects Paterson’s proposed taxes on sugared beverages and cigarettes, while providing property tax rebates to the elderly that weren’t part of the governor’s budget.

“This budget must reject new taxes, implement a serious job-creation program and control spending -- all basic values and priorities absent in the governor’s proposal,” Travis Proulx, a spokesman for Sampson, said yesterday.

The Senate budget plan proposed in March included $700 million from refinancing state debt backed by payments from tobacco companies. An Assembly plan included a $2 billion sale of deficit-reduction bonds due in 10 years.

Cash Shortfall

New York, the third most-populous U.S. state, may sell cash management notes or delay paying bills as it faces a cash shortfall in the first week of June, state budget director Robert Megna said at a press briefing yesterday.

The cash shortage amounts to $1 billion and having a budget in place would make it easier to sell the notes, he said earlier this month.

The cash squeeze reflects past deficits and delayed payments, not a further drop in state taxes. Revenue was within $100 million of projections in April, usually the biggest month of the year for tax collections, he said.

“There’s no bonanza there,” Megna said, referring to hopes that a rebound in tax revenue might shrink the deficit.

To balance revenue and spending, Paterson said he’ll ask lawmakers to approve an additional $409 million of spending cuts and $211 million of new revenue.

About $100 million of savings would come from a 50 percent reduction in this year’s business-related tax credits, he said. Further savings or revenue come from 31 proposals the governor said he will submit to lawmakers.

Five Days in Albany

If the Legislature doesn’t approve his budget, Paterson said he’ll ask lawmakers to remain in Albany five days a week, instead of the two- or three-day schedule they’ve followed since April 7. The Senate and Assembly were recessed from March 28 through April 6 for religious holidays.

Paterson’s furlough plan is illegal and “we will take every action necessary to stop the governor’s proposal,” Kenneth Brynien, president of the 58,000-member Public Employees Federation, the second-largest state employee union, said in a statement.

To contact the reporter on this story: Michael Quint in Albany, New York, at mquint@bloomberg.net.

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