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EDITORIAL: Is this the way to cut New York State's budget?

Gov. David A. Paterson has proposed a $3-billion cut to the state budget to make up for a greater than anticipated shortfall in revenue. But this latest hit-list undercuts his own long-term policy ideas and sets the stage for a continuing pattern of crisis-based fiscal planning.

For example, the governor wants to make a rare midyear reduction in school aid - an idea that throws district budgets into chaos months after schools have set class schedules and hired staff. Together with cuts in aid to local governments, these changes will put enormous pressure on property taxes.

The governor says that his plan should not affect property taxes. But schools and local governments will be tempted to raise them next year if the state reduces its payments. Had Paterson continued working on his goal of passing a property tax cap, school budgets would be held to maximum 4 percent increases.

What's more, the governor wants to cut school aid an average of about 3 percent across the state, but he proposes larger cuts here - an average of 4.7 percent. While Long Island is regarded as relatively rich, state school-aid formulas unfairly ignore the higher cost of living here. It's hard to argue that middle-class districts like Sachem and Sewanhaka deserve less than comparable schools elsewhere in New York.

Proposed reductions in Medicaid and other health and mental hygiene services don't address the needs of public-mission hospitals like the Nassau University Medical Center. And after years of the state fighting high-profile battles with the Bush administration over funding Child Health Plus, Paterson wants to cut it by $14 million? This is a stark reversal.

Agency budget cuts are yet another example. As announced two weeks ago, Paterson wants 11 percent reductions in nonpersonnel spending, to save $500 million. But not all agencies are equal, and environmental protection, public universities and health departments, as mentioned, will be harmed most. It's counterproductive to reverse course on the environmental commitments to the Regional Greenhouse Gas Initiative and the Environmental Protection Fund.

Nor are such agency cuts tied in any way to long-term savings. The Paterson administration has been talking for months with a dozen-plus public employee unions but has failed to win concessions: greater employee contributions to pensions and health care, or the creation of a less generous pension tier for new hires. While these talks continue, the governor has promised not to lay off agency employees. But New York's government is too big and has been for years - balanced with debt and "one-shots," or one-time revenues. Reducing staff might be a good idea, and several lawmakers have suggested agency consolidations.

The governor has shown leadership just by presenting a plan - no Democrat in the Assembly or Senate has done as much. But this is more a conversation-opener than a final verdict. The Republican conferences in both houses have raised good ideas for cuts that should be considered as the legislature convenes next week.

Albany must refuse to waste this crisis, as Washington is so fond of saying. Important reforms and policy goals cannot get lost amid the chopping noise. State leaders should put down the meat cleavers and pick up the scalpels. hN