UPDATE 1-NY Gov cuts budget as state faces shortfall
July 31st, 2008 | by admin |(Adds byline, details, new paragraphs: 3-10)
By Joan Gralla
NEW YORK, July 30 (Reuters) - New York, hit by a budgetcrisis as Wall Street’s decline hits revenues, will slicespending by $630 million with layoffs, a hiring freeze andother cost cutting measures and seek another $600 million in anemergency summer session, New York Governor David Paterson saidon Wednesday.
“We’re all going to feel some pain. The sooner we canaddress it, the sooner we can recover from it,” the Democraticgovernor told a news conference.
The governor blamed over-spending coupled with dramaticlosses on Wall Street, which supplies one out of every five taxdollars for the state’s financial crisis.
Like many governors around the nation, Paterson threw openthe door to public-private partnerships, but ruled out sellingany state assets, including the New York State Thruway.Instead, the state will examine leases or management programs,he said.
His predecessor, former Democratic Gov Eliot Spitzer,wanted to privatize the lottery to raise billions of dollarsfor higher education but the legislature spurned the idea.
In March, Paterson rejected a millionaire’s tax hike thatwas proposed for the current $122 billion budget, and onWednesday he called tax increases a last resort. “The reasonI’m avoiding taxes is because I think taxes are addictive.”
Later, he said he was hopeful the legislature will enact aproperty tax cap bill he proposed. The Republican-led Senateplans to approve the bill on Aug. 8. But the bill has not wonfavor in the Democratic-controlled Assembly, partly because thespeaker fears it will hurt school budgets.
