Gov. Dave Paterson Cuts Funding For NY Schools

NY Gov Dave Paterson makes his stunning announcement to cut much needed funding from the state's schools.





Gov. Paterson to withhold 10% from schools, local gov's - including NYC


Gov. Paterson called it a "day of reckoning."

Lawmakers slammed it as just bad theater.

Paterson on Sunday announced plans - first reported in Sunday's Daily News - to shortchange the state's cities and schools 10% of the $1.9 billion in state payments due Tuesday.

New York City will lose at least $84million in funding under Paterson's plan to withhold payments to keep the state afloat this month.

"I can't say this enough: The state has run out of money. We are $1 billion short," he said.

For the city that means its school aid payment will be about $60 million short and its municipal assistance payment $23.9 million lower than expected, Paterson's budget office said.

The city is expected to lose more money at the end of the month when Paterson will withhold nearly 19% of the remaining $3 billion in scheduled payments statewide for a school property tax relief program and human services reimbursements to counties.

Paterson, citing possible federal issues, said he will not withhold any Medicaid payments.

While a spokesman for Mayor Bloomberg had no comment, saying the city had not been briefed on the plan, the impact on the city is expected to be negligible.

The $60 million being held back in school funds is far lower than the $223 million Paterson originally proposed cutting in October as part of an overall $686 education aid reduction ultimately rejected by the Legislature.

Bloomberg at the time had publicly praised Paterson for "trying to treat everyone fairly with evenly distributed cuts."

While the impact on the city and city schools may not, for now, be severe, smaller cities without cash reserves could be in more trouble.

All told, Paterson said he will hold back $750 million in statewide payments due this month. He said the state may eventually pay the money if revenues pick up in the next few months.

He placed blame on the Legislature for recently enacting a $2.7 billion deficit reduction package that fell $500 million short of the $3.2 billion in savings he was seeking to help close a current-year budget deficit.

He blasted lawmakers for making "irresponsible" and "wrong" choices by putting politics ahead of the state's interests by not addressing the "full ramifications of this deficit and this budget crisis."

Paterson said he expects legal challenges but believes he is on sound footing. He said the budget enacted in the spring stipulates that no local assistance payments can be made until they are certified by his budget director.

"The governor's action here is not to balance the budget, it's not to act in lieu of the Legislature, it's to make sure the state doesn't run out of money," he said. "It's to make sure the state does not become insolvent."

Legislators accused the governor of overstepping his boundaries.

"Case law says the Legislature is the branch of government with the power to enact and amend the budget," said state Sen. Eric Schneiderman (D-Manhattan).

Added Senate Democratic majority spokesman Austin Shafran: "New Yorkers don't want political rancor or self-indulgent theatrics. They want their leaders to work together to get things done."

While Senate and Assembly insiders say there is no plan for the Legislature to sue Paterson, education groups have said they are prepared to do so.



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Sources: NY Daily News, Google Maps