If the state budget gets worse your job may be in jeopardy.
Paterson warns of possible job cuts, layoffs Joseph Spector • and Cara Matthews • November 21, 2009
ALBANY — With New York facing a cash crunch, Gov. David Paterson warned Friday that he may have to take steps other states have taken — such as layoffs, furloughs or shutting down prekindergarten programs — if lawmakers don't make budget cuts this month.
The state could run out of money in late December if cuts aren't made, he and other officials said. That means the state would have to borrow and possibly delay payments to local governments.
Paterson said if all the state's money was pooled together next month and all bills paid, the state would have about $30 million in the bank — a paltry amount considering the total budget is $132 billion.
Comptroller Thomas DiNapoli warned Friday that the state faces a $1.4 billion cash deficit next month.
Meanwhile, a report from Moody's Investors Service said the state could lose its stable credit rating "if there is no action taken by the state to close the gap, or if action is taken but is largely one-time in nature."
Paterson is at odds with lawmakers over cutting aid to schools and health care to help close a $3.2 billion mid-year budget shortfall. After four days of failed negotiations, lawmakers went home Thursday and plan to return Monday.
But Paterson continued his tough talk Friday. He said spending reductions now would help lower next year's deficit, which he estimated could reach $9 billion.
Paterson said he spoke to legislative leaders Friday to advise them of the dire predictions. But lawmakers have so far offered no cuts to schools and only about $100 million in cuts to health care. Paterson has proposed cutting about $1.3 billion.
"I think this is a lot more serious than the interest of some of the legislators who would rather go home and be heroes saying, 'Look, I didn't cut school aid' or 'Look, I didn't cut health care,'" Paterson said.
Senate Minority Leader Dean Skelos, R-Nassau County, criticized the governor for not submitting a bill lawmakers can act on.
"The governor should stop pounding the table, do his job and stop worrying about his poll numbers so that we can get a final agreement," Skelos said in a statement.
Paterson said lawmakers can vote on his plan anytime they want.
Senate Democrats and Republicans said this week they agreed on how to close about $2.6 billion of the shortfall. They think New York should avoid school cuts by using $391 million in federal stimulus money for education that was supposed to be used in the next fiscal year, which begins April 1.
Paterson has said he would not accept a budget that doesn't reduce education spending.