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  • Stalemate in Albany as State Nears Its Last Dollar
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    Published: November 26, 2009
    ALBANY — New York State is running out of cash.

    Without a budget deal, New York will be left with just $36 million in the bank by the end of December, according to current projections. And the money will last that long, officials say, only if the state chooses to fully exhaust its emergency reserves by tapping several billion dollars’ worth of temporary loans from its rainy-day fund and short-term investments.

    For weeks, Gov. David A. Paterson has invoked the shrinking amount of available cash in an effort to provoke the Legislature to deal with the state’s $3.2 billion budget deficit. So far, the specter of such dire fiscal outcomes has been greeted with what amount to legislative shrugs, chiefly in the recalcitrant State Senate.

    The stalemate in Albany is familiar, of course, and there are many lawmakers and experts who predict that the Legislature will act at the 11th hour, as it has before, to avoid the worst damage.

    But with no end in sight to the negotiations, state officials are beginning to reckon with what could be an unprecedented cash crisis. And many say that even if the current deficit is closed, the state is at considerable risk going forward — less able, for instance, to borrow money because of worsening credit ratings and ill prepared for far more severe deficits ahead.

    New York, which has a roughly $130 billion budget, the second-largest behind California, is certainly not suffering alone. The 50 states have faced cumulative deficits of more than $250 billion over their last two budget cycles, according to data compiled by the National Conference of State Legislatures. In New York, the weight of the recession has been coupled with the struggles of Wall Street, the state’s main financial engine.

    But New York is by no means California, which has become the national measuring stick of statewide financial ruin. The state is not sending out i.o.u.’s to creditors, students at state schools are not holding sit-ins in dormitories, and Albany, unlike Sacramento, has not had to grapple with relocating a tent city for the homeless. Further, revenue typically picks up in January, when Wall Street bonuses, however diminished from previous levels, start coming in.

    But the situation in New York is not good, either.

    In modern times, the state’s general fund has never had a negative balance, according to the state comptroller’s office. If New York does in fact run out of cash, it will have to delay paying some of its biggest bills. Chief among the bills the state will face in December are $1.6 billion in aid the state is supposed to pay school districts, $2.5 billion in property tax relief to individual homeowners, and $500 million in general aid meant to go to local governments.

    “If you put any of that off, at some point people are not getting the money they are expecting,” said the state comptroller, Thomas P. DiNapoli, a Democrat. “That could affect local governments, school districts, nonprofits, hospitals.”

    The governor and his staff have raised the threat of layoffs and furloughs if the impasse drags on, and there is the potential for a partial shutdown of some government services.

    “Unless we act, New York will run out of money, even after we delay payments to schools and local governments,” the governor said Tuesday in a brief address via Web cast. “This is an unprecedented fiscal emergency.”

    The state’s credit rating is below average and at some risk of a further downgrade. The Paterson administration has already squeezed the budgets of state agencies, an action it can take unilaterally. And this year’s skirmish is considered a prelude to a fierce budget fight in 2010, when the deficit is far larger in what is an election year for the entire Legislature.

    There have already been any number of ways that the strain on the budget has been felt across the state. Billions of dollars worth of scheduled increases in school aid, enacted by Gov. Eliot Spitzer to settle a long-running lawsuit over the distribution of school aid, will be stretched out over seven years instead of four. Taxes on the wealthy have been raised, and fees of all kinds have been increased.

    For the first time in decades, the state Police Academy probably will not have a new class for either the fall or the spring. The state has closed three upstate minimum-security prison camps and six facilities operated by the Office of Children and Family Services. Hours have been limited and facilities closed at parks including Jones Beach, and parks across the state are mowing fewer lawns to save money. The state ice rink was closed last winter.

    Budget watchdogs say far steeper cuts are needed to reckon with deficits that will escalate sharply in 2011 as federal stimulus money runs out and the new wealth tax expires.

    But negotiations have been fundamentally stalled — and even irrational at times. Senate Democrats, who have thus far refused to hold a vote to legalize same-sex marriage, have nonetheless floated the theory in negotiations that the state could expect to take in more than $50 million a year in new revenue from the legalization of same-sex marriage, from a combination of marriage license and tourism revenue.

    They are also proposing to raid the treasuries of public authorities, to force Native American tribes to collect cigarette taxes, and to restructure the state’s tobacco bonds.

    And Mr. Paterson remains politically weak, with a dismal standing in the polls and an inability to provide forceful leadership, critics say.

    The impasse involves a fundamental disagreement. The Paterson administration argues that the state must begin to reckon with severe future deficits, and this view appears to have the support of Assembly Speaker Sheldon Silver. Senators prefer to take temporary measures and push off the day of reckoning as long as possible.

    Budget experts are paying close attention. They say how the deficit is closed is as important as closing it. Not only will the negotiations affect the state’s enormous future deficits — out-year gaps, in budget parlance — but bond rating agencies are scrutinizing the process.

    “The next three months will be critical to the state’s credit rating,” Moody’s Investor Service said last week, in an analytical note that rattled the capital.

    “The announcement of out-year gaps is not in and of itself an issue,” Emily Raimes, an analyst at Moody’s, said in an interview. “What we look at is how they solve them. If they solve them with one-time measures, that’s going to increase the gaps in future years, and at some point they get so large it becomes difficult to solve them.”
    Last edited by pdlynbrook; 11-28-2009, 01:51 AM.

    Comment


    • The First Deputy himself stated last week there would be no class in 2010...

      Comment


      • Originally posted by cadetlinux View Post
        The First Deputy himself stated last week there would be no class in 2010...
        I definitely agree with this, but only if things continue to stay the way they are now. What everything really depends on is what, if any, legislation comes out of Albany in the next month. That being said, I'm numerically speaking next in line to get processed, and I'm not expecting any sort of letter or communication in the forseeable future. Truth be told I just don't trust, or more accurately said, expect lawmakers in Albany to do the what is right and necessary. It truly is sad, but the reality we are faced with.

        Comment


        • Happy 1 year 197th

          Comment


          • Tiger Woods has just received the most famous citation ever! Congratulations!!!!!!!!!! BRAVO!!!!

            Is it me or is anyone else sick of this ****?

            Comment


            • ...................................
              Last edited by GrayState; 01-25-2013, 09:18 PM.

              Comment


              • Two more shot

                http://www.9wsyr.com/content/news/br...euQeJIDVw.cspx

                Prayers for the officers safe recovery.

                Comment


                • Originally posted by Nick331 View Post
                  Tiger Woods has just received the most famous citation ever! Congratulations!!!!!!!!!! BRAVO!!!!

                  Is it me or is anyone else sick of this ****?
                  i still say son of sam takes this one

                  Comment


                  • Originally posted by Dr. Peebody View Post
                    i still say son of sam takes this one
                    Touche.

                    Comment


                    • Originally posted by Nick331 View Post
                      Touche.
                      we'll break up the categories.....tiger wins most famous mover, berkowitz get most famous parking violation

                      Comment


                      • Originally posted by Dr. Peebody View Post
                        we'll break up the categories.....tiger wins most famous mover, berkowitz get most famous parking violation
                        That is reasonable. Tigers wife is wow

                        Comment


                        • <---Formerly DubyaSTI (my account got deactivated somehow)

                          Anywho I've heard from two different sources that the SP signed a deal with Chevy to take over our vehicular needs once Ford stops CV production.

                          Comment


                          • Originally posted by TprSP View Post
                            <---Formerly DubyaSTI (my account got deactivated somehow)

                            Anywho I've heard from two different sources that the SP signed a deal with Chevy to take over our vehicular needs once Ford stops CV production.
                            The proposed 2011 Caprice Interceptor is AWESOME. The 6.0L V8 is great, but they should really put a Duramax in it!
                            Last edited by NYSP61; 12-12-2009, 06:07 AM.

                            Comment


                            • Originally posted by NYSP61 View Post
                              The proposed 2010 Caprice Interceptor is AWESOME. The 6.0L V8 is great, but they should really put a Duramax in it!
                              more importantly.......will there be an aux input for my ipod??

                              Comment


                              • Aux.

                                Used to carry the big pilot type brief case, it held a small portable tv for those days and nights where there may be a good football game on.

                                U-turn at MP 97 on the Pike had good reception !

                                Comment

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