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No deal yet in Albany on budget deficit

Herb Boyd | 4/12/2011, 4:36 p.m.

Rumors that Gov. David Paterson had accepted state legislators' proposals for closing the budget deficit were apparently half true and half false. And the key word here is "accepted," because while the governor made it clear on Tuesday he had accepted the legislators' "best offer," it was by no means a deal.

"A deal means that all parties were in agreement," the governor told reporters. He believed the legislators' bill did not go far enough in closing the $3.2 billion deficit.

According to Paterson, the legislators' plan of $1.6 billion in reductions was already part of his cuts. He also expressed a concern that their plan chipped money from the federal stimulus package for schools, which was earmarked for next year's budget.

Moreover, he charged, the legislators' plan contained no mid-year school aid cuts, and this is something the governor has continually stressed. The education cuts in the middle of the academic year have been roundly opposed by Democrats in the Senate.

It is still to be determined if the governor will examine the legislators' plan and compose a new bill. And with the state dipping precipitously down to its last $36 million, time is of the essence.

Meanwhile, Paterson did make substantial moves in two areas. He accepted the Final Report of the Small Business Task Force, that includes proposals to address increasing access to capital; reducing red tape and providing regulatory reform; strengthening and enhancing training and technical assistance for business owners, employees and aspiring entrepreneurs; and improving access to, and awareness of, available state resources. Each of these priorities includes a series of actionable initiatives that will spur economic growth and make doing business in the state easier, according to a press statement from the governor's office.

"In this age of super-sized corporations, small businesses may not make the headlines, but they do drive job creation," Paterson said. "The road to prosperity runs through New York's corner stores and technology start-ups, its mom-and-pop restaurants and roadside repair shops. That's why I have worked for the past 20 months to expand opportunity for small businesses, to increase minority- and women-owned business participation in government contracting four-fold and to double alternative lending resources for entrepreneurs."

He also announced that the Legislature has passed the Governor's Program Bill No. 213, landmark pension reform that will provide billions in long-term savings to New York taxpayers. The legislation creates a new Tier V pension level, the most significant reform of the state's pension system in more than a quarter-century.

"Throughout this fiscal crisis, I have made clear we need to both reduce our spending and also fundamentally reform how we spend. This pension reform is a critical step in that process, and the savings will be achieved not only in state spending, but at the local level, which will help to reduce property taxes," Paterson said. "I applaud Senator Majority Conference Leader Sampson and Speaker Silver for joining me in achieving this long-overdue reform. I also thank the leadership of the state's public employees unions for acknowledging the need for reform."

More work needs to be done on this measure, Paterson added, and the same can be said on the pressing matter of the state's budget deficit.