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The Associated Press May 18, 2010, 8:17AM ET

NY gov. predicts rejection of many school budgets

Gov. David Paterson said Monday he may have to lay off state workers because of a fiscal crisis that he predicts will also lead to the defeat of many local school budgets Tuesday.

With private negotiations stalled and the possibility of one of the latest budgets in years, Paterson called the first public leaders' meeting in months. That session is scheduled for Tuesday.

"I think we have a better framework of understanding where we have to be," said Assembly Speaker Sheldon Silver, a Manhattan Democrat, after private talks with Paterson and the Senate leader over the weekend. "Time is of the essence."

A lack of a 2010-11 budget that was due April 1 has delayed payments to schools and funding for state construction projects, local governments and nonprofit groups that carry out social services. Now the Legislature appears unwilling to change state law to allow Paterson to miss a June 1 deadline for paying billions of state aid to public schools. Paterson proposed delaying the payments until the end of June, a critical time for school payrolls.

"We're talking about laying off (and) furloughing workers," Paterson said Monday. He spoke at the opening of a new park in New York City even as he cuts services at most upstate parks and closes some to cut expenses.

"These conversations only come up in the midst of a recession," he said. "But the responsible decisions, the ones that are tough decisions, the ones that were not made in the past, are now the ones that have to be made by this administration."

Paterson said there's no plan yet for layoffs, but there is talk in his administration.

"He can manage the state work force in any way that he chooses," Silver said. "He doesn't need the Legislature to do that and it is clearly one of the options available to the governor."

Paterson wouldn't comment further on the prospect of layoffs while he is waiting for a judge to act on a lawsuit by public employee unions trying block his order for eight days of unpaid furlough for about 100,000 workers. He said he resorted to furloughs after unions refused offers to delay getting paid for a few days and to suspend their annual 4- to 7-percent raises.

Paterson emerged with no agreements after meeting privately for an hour with the Assembly's Democratic majority in a session he and an Assembly member described as sometimes contentious.

Negotiations continue. But the Democratic state convention is next week, followed by the Republican state convention and Paterson said it's possible a budget won't be done until at least mid-June, which would result in one of the latest budgets in Albany's decades-old practice of late budgets.

He added, however, that when negotiating positions get closer, a budget can "come together very quickly."

The Democrat also said that he expects many school budgets will be rejected because voters are saying public spending must be cut and tough decisions are needed. School districts outside the state's five largest cities hold votes on their budgets and taxes Tuesday. In most years, more than 90 percent of school budgets are approved, often with extremely low voter turnout.

"I think people will be very surprised when the public -- not the governor, not the Legislature -- votes down a lot of those plans saying, 'Spend less money,' saying 'You can't spend money that you don't have,' saying that it's time for us to make the tough decisions to get out of this recession and back to prosperity," Paterson said.

"We are not going to do it by borrowing or taxing or putting off problems to tomorrow which we need to address today," Paterson said. He has noted that more than 70 percent of school spending goes to salaries and benefits.

Earlier this year in New Jersey, 59 percent of the state's school districts rejected property tax levies.

Meanwhile, the New York State United Teachers union is holding its annual get-out-the-vote campaign. The union is spending $265,000 in a broadcast and Internet campaign urging voters to "invest in our children and our public schools. Time is just about up."

The radio ad states that "this year your vote matters," and in the face of proposed cuts in state aid and local spending cuts, rejected budgets will mean teacher layoffs and the end of tutoring and after-school programs.

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