NY lawmakers headed home, no deal on deficit

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November 20, 2009

By MICHAEL GORMLEY The Press Republican Fri Nov 20, 2009, 07:50 AM EST

ALBANY, N.Y. (AP) — New York lawmakers headed home Thursday without agreement on how to address the state's fiscal crisis.

The Legislature was in session all week — at a cost of about $70,000 a day — but couldn't agree on how to close this fiscal year's $3.2 billion deficit. The Assembly, Senate and Gov. David Paterson have been talking about steps that would likely have to include cuts in spending on schools and health care, each protected by powerful special interests.

But the Senate's Democratic and Republican leaders were unified against any cuts in school aid, which advocates said would result in layoffs and higher local property taxes in the spring.

"It's not going to happen," said Sens. John Sampson, the Democratic leader; and Dean Skelos, the Republican leader, in unison to reporters.

Paterson said cuts to school aid and health are critical because they represent 55 percent of the state budget.

He countered that more than 70 percent of school aid goes to salaries and benefits, not instruction, and schools facing proposed cuts have reserves to cover the loss. Leaving schools and health care uncut forces greater and unfair strain on the remaining 45 percent of the budget, he said.

"This is the reason I'm holding out," Paterson told reporters. "What I want to do is reduce this deficit in a way that our bond holders and our credit raters see that we are on the road to recovery, not careening down a hill."

Legislative leaders plan to return to Albany on Monday to pass a deficit reduction plan, if there is a deal among leaders. They could convene earlier if a deal is struck.

Paterson said Wednesday night he wasn't planning to compel lawmakers to stay in Albany any longer because they were clearly negotiating in good faith.