Gov. Paterson now projects the deficit for the coming year at $8.2 billion, that's up $750 million from the figure he named in his budget. According to the budget division, low tax revenues from the banks are to blame. "We know that big guys typically pay us at the end of January,” said Robert L. Megna, the state budget director, referring to large banks like Goldman Sachs and JPMorgan Chase. “Last week, after the budget came out, they didn’t pay us.” Typical.
Megna offered a number of reason why the state can't collect: more Wall St. bonuses are paid in stock these days and spread out over a longer period. Still, he said the state isn't expecting the money to come rolling in anytime soon, reports City Room.
Another deficit contributor is Medicaid, which jobless New Yorkers have been using in record numbers. Costs for the program are $400 million higher than expected for the coming year, the budget office said. More gloom and doom came from state Comptroller Thomas DiNapoli, who tells the AP that even the new higher deficit is a conservative estimate, since Paterson's budget relies on "billions of dollars from overly optimistic revenue and savings assumptions that may not happen."
