Paterson's $134B Budget Would Cut Health Care and Education, Revive Fat Tax

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Gov. David Paterson is proposing a $134 billion budget that cuts schools, health care, and state agencies and would impose new taxes on cigarettes and soda pop.

Saying New York faces an "inevitable fiscal reckoning," Paterson would close a $7.4 billion gap by cutting school aid by $1 billion, and health care and state agencies by another $1 billion each, though he's not proposing layoffs.

Paterson revived his proposal for the so-called "fat tax," a one-cent charge on sugared soft drinks, and he would raise the cigarette tax by another dollar. The governor will also try to collect taxes on cigarettes sold on Indian lands, and allow wine to be sold in grocery stores.

Paterson proposes raiding the environmental protection fund and placing a moratorium on open space land acquisitions. He would also end a state aid program to New York City, and put off for now training any new state police officers.