WXXI: Legislature Reacts Cautiously to Spitzer's Budget Revisions (2008-02-11)

Governor Spitzer will revise his state budget to reflect a $384 million dollar decrease in tax collections. Assembly Speaker Sheldon Silver, a fellow Democrat and ally of Spitzer's, says "it's the right thing to", given all of the economic uncertainty and the downturn on Wall Street.

To close the widening budget gap, Spitzer proposes increasing a tax on health care providers, and cutting funds to hospitals by reducing the cost of living increase known as the trend factor. He'd also raid $25 million dollars from an environmental protection fund.

State Senate Majority Leader Joe Bruno was against the governor's original budget plan to increase taxes on HMOs. Spitzer wants to tax HMOs at the same rate as other insurance companies. Bruno, the state's top Republican, says the increase would be passed on to policyholders and possibly contribute to the ranks of the uninsured, and goes against "common sense".

Senator Bruno, who has been at odds with the governor for months, says he has larger disagreements with the Governor's budget, including a proposal to raise $1.7 billion dollars in revenue by increasing fees, and closing tax loopholes.

"The governor doesn't get it," said Bruno. "He's got his priorities wrong."

Senator Bruno says he'd raise the revenue needed to close the gap by enforcing tax collections for the sale of cigarettes on Indian reservations, reaping one- time benefits from the conversion of a large non-profit health care provider to the private sector, and expanding gambling.

And while Assembly Speaker Silver agrees that it's wise for the governor to reduce revenue projections, the Speaker did not commit to supporting any of the governor's proposals for closing the budget gap.

"We'll have to wait before we pass judgment," Silver said.

Speaker Silver says he does not think there will be further downward reductions in tax collections before the April 1 deadline to settle on a spending plan.