http://www.crainsnewyork.com/article/20091014/FREE/910149986

NY state is running out of cash

By Daniel Massey

Published: October 14, 2009 - 3:42 pm

The state budget deficit could reach $4.1 billion, as monthly revenue collections continue to fall short of projections, the state comptroller said Wednesday.

“I said in April that this was a ‘buy time' budget, and now time is up,” Comptroller Thomas DiNapoli said in a statement. “This budget simply has not held together.”

The state Division of Budget has projected a $3 billion gap for the fiscal year ending next March 31, but Mr. DiNapoli said the end-of-year gap could be more than $4 billion if no action is taken.

“The spending promises made in the spring are not sustainable in the face of falling revenue,” he said.

The comptroller's September cash report showed total General Fund tax revenue to be $18.1 billion, $634.5 million below projections for the first half of the year and $3.6 billion less than the same period last year. The drop-off is primarily due to weakened personal income tax collections.

Mr. DiNapoli said that without a solution, the state may face a deficit of nearly $9 billion by the 2010-11 fiscal year.

The governor and state Legislature have yet to release a plan to plug the deficit.

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