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Paterson and NY Legislature Wrangle Over Budget

Sunday, June 27, 2010

Gov. Paterson and New York's legislature are still trying to negotiate a state budget that is nearly three months late. While the legislature says it will vote on their own budget tomorrow, the governor says he will veto any changes to his plan.

In the final hours before Governor Paterson's latest threatened shutdown of government, legislators in Albany met to review his emergency extender against the backdrop of their own $136 billion budget plan. Paterson had ordered the Assembly and Senate to consider the elements of his budget they had rejected in their leader's agreement.

Assembly Speaker Sheldon Silver tried to downplay the differences between the governor's budget and the legislature's, including restoring $600 million to school aid, more funds for community colleges and housing.

"If you total everything up, the difference between us and him is $200 million dollars," Sheldon told reporters before today's special session, which lasted less than five minutes. "$200 million dollars over what will be a $135 or $136 billion budget--that is less than one tenth of one percent."

If he and legislators are not able to find a consensus, Gov. Paterson plans to impose the remaining 30 percent of his budget cuts in what would be his final weekly emergency spending bill to end the nearly three-month-old stalemate. He had set a June 28th deadline for the move.

Senate Democratic leader John Sampson wouldn't say if he has enough Democrat votes to pass the budget bills agreed to by leaders of the legislature, but he said Senate and Assembly will have amended and passed a budget plan by the midnight hour.

"He was serious about his deadline dating the 28th," Sampson said. "We took up his challenge and we are going to get it done."

In calling today's special session, Governor Paterson made the legislature consider his plan to provide greater autonomy to SUNY and CUNY to create a savings fund in case the state doesn't receive a $1 billion dollar Medicaid reimbursement from Washington, known as Federal Medical Assistance Percentages (FMAP). Paterson says that legislators are not "listening to signs from Washington" and have no alternative plan if that money doesn't come through.

"There is no plan, there is absolutely no way that the legislature addresses this," Paterson told reporters. "It is as if they just stick their heads in the sand and ignore it."

Gov. Paterson says he will veto money added by the legislature--including $200 million in extra funds for schools--if it does not include the “vital issue” of forestalled assistance under the Federal Medicaid Assistance Program.

A few agreements have been reached, however, including eliminating a proposed sales tax on clothing and shoes costing under $110 and cutting charitable deductions for New Yorkers earning $10 million a year in half.

But the legislature continues to reject Paterson's plan to sell wine in grocery stores to raise revenue, his suggestion to "empower" the public universities with more autonomy and the authority to raise tuition by up to 8 percent annually over the next four years and his proposal to cap the growth on local property taxes, including school taxes, to about 4 percent a year to stem some of the nation's highest property taxes. These would all bring in additional revenue, should the FMAP funds fall out shorter than expected.

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