New York Gov. David Paterson signed into law appropriations for $4.41 billion of debt service last week because a budget deal appears unlikely before the April 1, beginning of the new fiscal year.
The bill appropriated $2.01 billion for debt service on personal income-tax bonds, the main credit the state uses for borrowing. The law also appropriated $515 million for general obligation bonds.
Paterson last week submitted an emergency spending bill to keep government running in case the budget is late.
Last week, the Assembly and Senate passed separate budget resolutions of $136.7 billion and $136.2 billion, respectively. Both proposals included borrowing to help close the deficit.
The Assembly’s plan would sell up to $2 billion of deficit bonds in fiscal 2011 and enact a financial review board resembling one contained in a proposal by Lieut. Gov. Richard Ravitch.
The Senate proposal would refinance outstanding tobacco bonds and extend their repayment to raise another $700 million.
Paterson was critical of both proposals for not cutting as much spending as he had proposed in his $134 billion executive budget proposal.
It was unclear whether lawmakers would work through the Passover and Easter holidays to pass a budget.
