Published by

Deficits Grow for Albany and MTA

Email a Friend

Gov. David Paterson says New York's deficit has grown by $750 million to $8.2 billion. He says he’ll present lawmakers with new plans to balance the budget next week.

Paterson blames a decline in Wall Street earnings and higher Medicaid costs for the revised shortfall. Just before the governor made his announcement the State Comptroller Tom DiNapoli released a detailed analysis of the budget proposal. He says the governor's revenue projections were unrealistic to begin with.

"We've been warning for a number of months now that the budget has been built on unrealistic projections going back to the budget process of last April," DiNapoli says.

And DiNapoli says as the legislature crafts its spending plan, lawmakers can't rely on a miraculous uptick in the economy to bail the state out.

Meanwhile, the Metropolitan Transportation Authority says it too will come up another $400 million short and more service cuts may be necessary. The MTA has already announced that it will end service on the M and W subway lines and more than two dozen bus routes beginning this summer.

A new, dedicated MTA payroll tax has yielded far less than expected. State officials warned the MTA in December that the payroll tax was under-performing expectations. But, at the time, they thought people were paying the tax later. On Tuesday, state budget officials told the MTA they no longer thought the money would come in at all because fewer people are employed or are earning lower salaries.

"We do our best to be conservative, but this has really been a historical anomaly in how bad the recession has been," says Matt Anderson, a spokesman for the state's budget office.

An MTA spokesman says the authority intends to keep fares level at least through December. But everything else is on the table, including further service cuts.