New York Governor David Paterson said next year's record budget gap may be $3 billion greater than the $16.2 billion he announced earlier this week and hinted a tax increase on higher incomes is possible. The newly estimated gap for the year beginning April 1 was 25 percent more than projections six weeks ago, he said.
| Anyone consider cutting all the discretionary spending that was larded on in the last few years of plenty? |
Paterson and legislative leaders said earlier this week that the deficit continues growing because of falling tax collections in a shrinking economy with rising unemployment. If next year's deficit exceeds the $16.2 billion estimate, the spending plan would be amended, as lawmakers did twice in the current year.
The state Labor Department said yesterday that New York's unemployment rate rose by a record 0.7 percentage point in February to 7.7 percent, the highest since 1993. In New York City, the jobless rate rose 1.2 percentage points to 8.1 percent in February.
Paterson said he continues to press leaders of the Senate and Assembly for spending cuts in addition to the "record" cuts already agreed upon. He didn't identify the kind or amount of the reductions.