New York prepared to end the first month of its fiscal year without a budget in place as lawmakers last night were expected to pass an extender bill to cover spending through May 1. The emergency spending bill would be the fourth since the fiscal year began on April 1.
According to a report in the Wall Street Journal yesterday, lawmakers are considering a $1 billion note sale as a short-term fix to help close the $9.2 billion budget deficit.
That seemed unlikely, since state law would require Gov. David Paterson to agree to declare a fiscal emergency in order for the state to sell the notes.
“I will not entertain a discussion on borrowing while the state continues to spend beyond its means,” Paterson wrote in an op-ed appearing in the New York Times yesterday. “Borrowing to help close our budget deficit, by itself, does not do a single thing to help improve our long-term fiscal condition … And it violates virtually every principle of responsible budgeting.”
Dan Weiler, spokesman for Assembly Speaker Sheldon Silver, D-Manhattan, declined to comment on the Journal article.
Paterson, who proposed a $135.28 billion budget for fiscal 2011, called on lawmakers to “make difficult decisions.”
Up to $6 billion of deficit borrowing on the state’s personal income tax credit was included in a budget reform proposal crafted by Lieut. Gov. Richard Ravitch. Under that proposal, borrowing would be used to smooth a transition from cash budgeting to budgeting under general accepted accounting principles.
The state ended fiscal 2010 in balance only by delaying $2.9 billion of payments, Comptroller Thomas DiNapoli reported last week.
The state could run out of money by June as a result of pushing those payments into the new fiscal year that began on April 1, he said.
