Oct 16, 2009 8:17 pm US/Eastern
Paterson: Make Cuts Or I'll Stop Paying Schools
Gov Tells CBS 2 HD N.Y.'s Fiscal Situation Is So 'Dire,' He's Ready To Follow Pennsylvania's Lead; Promises No Taxes
NEW YORK (CBS) ―
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Gov. Paterson proposed a $5 billion plan to reduce New York state's deepening deficits with across-the-board cuts over two years. He gave the address Thursday, October 15, 2009.
Chris Hondros/Getty Images
Governor David Paterson has stepped up his demand for wide-ranging cuts to schools and hospitals, telling lawmakers point blank that if they don't come to the table he has a far worse scenario in mind.
To lawmakers who gave the governor's demand for $1 billion in cuts to schools and hospitals short shrift, Paterson has a message -- face reality. And that reality is pretty unpalatable.
The governor told CBS 2 HD if he doesn't get the cuts he wants he'll simply stop paying school bills, which will cause all kinds of chaos in the classroom.
"What we have to do is delay payments to school districts," Paterson said.
Paterson is seeking $686 million in school cuts, but if he doesn't get it he said he's prepared to do what other states like Pennsylvania have done.
"The reality is the ramifications of what Pennsylvania did … they stopped paying the school districts, their local governments and their service providers because they didn't have the money," Paterson said.
During an interview on CBS 2 HD's "Eye on New York" Paterson said that, plain and simple, New York doesn't have the money.
"You can't run away from your debt and obligations. If we get put in that position our credit rating will be downgraded. We won't be able to borrow at all. We won't be able to pay our school districts, our local governments so this is extremely serious. This is dire," Paterson said.
And as for the Legislature's habit of throwing new taxes and fees at just about every problem, Paterson has a message on that too: not this time.
"No new taxes this year. No new taxes next year. We're not even getting the proceeds from the taxes we implemented this year because the people who pay the taxes have either become unemployed or moved out of the state," Paterson said.
In April the state enacted $8 billion worth of new taxes and fees. So far the State Assembly has said it will hold hearings on the governor's proposals and Senate Republicans have offered new solutions.
Senate Democrats, including Majority Leader Pedro Espada, have been dismissive of the governor's ideas.
(© MMX, CBS Broadcasting Inc. All Rights Reserved.)
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