Think Tanks Suggest Budget Cuts ALBANY, NEW YORK (WXXI) - The State Comptroller was the featured speaker at a forum on downsizing state government, sponsored by several influential think- tanks. The discussion comes one week before Governor David Paterson is expected to release his plan to close a budget gap that's now grown to nearly $15 billion dollars.

State Comptroller Tom DiNapoli, speaking at the forum sponsored by the Manhattan Institute's Empire Center and the Center for Government Research, said New York's fiscal meltdown has been years in the making, as too many bad decisions were made to use one shot revenue raisers and other gimmicks, and excessive borrowing, to keep spending at an unsustainable rate.

"Our trouble did not start when Wall Street collapsed," said DiNapoli. "Wall Street was the explosion, but the fuse was lit years before."

Many of the policy experts and other speakers at the event, titled "Right- Sizing New York's Budget", agreed with DiNapoli's assessment, and offered their own advice for restructuring spending.

Ideas ranged from getting rid of poorly performing economic development programs, like Empire Zones, and eliminating the State Education Department, to reforming the rules for capital projects to encourage more contractors to bid. Others spoke of easing rules applied to union bargaining and permitting school districts to band together to buy cheaper health insurance.

The suggestions come just a week before Governor Paterson will reveal his own plans to close the looming budget deficit.

The Empire Center's EJ McMahon says the governor, in recent speeches and initiatives, has demonstrated that he "gets it" when it comes to the need to cut spending. But he predicts that when the governor tries to sell those ideas to the legislature, he'll hit political roadblocks. And he says it will take years for legislators to come around.

"I do fear that we're going to need years of misery before they finally are willing to deal with this," said McMahon. "Unlike the big three automakers, the state can't go out of business."

Betsy Lynam, with the Citizens Budget Commission, agrees that lawmakers will likely try to stall awhile before making the hard decisions.

"They have a tendency to want to wait it out," said Lynam, who predicts "there will be reckoning at some point".

Lynam believes that a tax hike on the wealthy will be part of the final budget deal, but she says she hopes it comes only after spending has been trimmed and waste reduced. There is support for a tax on the rich in some factions of the legislature.

Comptroller DiNapoli spent two decades as a state Assemblymember before becoming Comptroller in 2007. He now preaches the gospel of fiscal conservatism, but says he understands, maybe better than anyone, that the legislature, with all of its competing interests and constituencies, presents an obstacle to government reductions. DiNapoli said he knew some at the forum might be labeling him "a reformed sinner".

"But bear in mind I was raised to believe that confession is the first step on the road to redemption," DiNapoli said, to laughter.

DiNapoli offered some cost saving ideas of his own that he says don't even require the approval of the legislature. He suggests calling in nearly $200 million dollars in loans owed to public benefit corporations, and consolidating state agency services like payroll and IT. And he says the State Health Department should make better use of an already existing anti-Medicaid fraud program.

Those at the forum say the biggest question they'll have on December 16th , when the governor's budget-cutting plan is presented, is whether Paterson will use a scalpel or a cleaver to achieve his ends.

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