Paterson says Combined Budget Deficit Now at $10b ALBANY, NEW YORK (WXXI) - Governor Paterson, at a meeting with legislative leaders, said the state's budget deficit has grown even bigger, and that lawmakers now face closing a combined $10 billion dollar gap for the end of this fiscal year and the start of the next.

Paterson told the legislative leaders that his budget office has completed it's mid year analysis, and finds this year's gap has grown slightly, to $3.2 billion dollars, but that the projected deficit for next year is now much larger, at a projected $6.8 billion dollars, up from a $4.6b estimate in the last analysis, completed in July.

Throughout the meeting, tensions simmered between Paterson and the leader of the Majority Party Senate Democrats, John Sampson.

Senator Sampson tried to once again bring up an alternative idea to some of the $3 billion dollars in cuts that the governor has proposed. Sampson said Senate Democrats would still like to refinance the state's tobacco settlement bonds to reap a cash windfall of up to half a billion dollars, an idea the Senator brought up at the last meeting.

"I talked about the tobacco bonds," said Sampson. "Which you generously, graciously shot down."

"I will not shoot down your tobacco bond proposals again Senator," Paterson replied. "Because they're already dead."

Senate Democrats are currently holding hearings on the governor's budget cutting plan, and Senator Sampson said they've heard many complaints, from those who would be effected by the cuts.

Senator Sampson said he wanted to give those effected by the cuts "a voice", and at one point even read from the testimony of a disabled person who appeared at a Senate hearing to speak against proposed service cuts. He said Senate Democrats also have concerns about the governor's proposed cuts to public colleges and universities.

The Senator's posture of sticking up for the little guy seemed to irritate Paterson, who finally delivered a lecture, saying the hard choices have to be made now, or people will suffer even more later. He said he wondered whether everyone at the meeting was getting the "message", and criticized those who he said would "obfuscate" the real issues.

The Leaders meeting comes on the day that the Governor released a new plan that he says will bring relief to property tax payers.

Under the plan, the governor and legislature would impose a spending cap on all state spending. There would not be a similar cap on property tax levies, instead, the governor proposes a circuit breaker, that would limit a homeowner's property taxes to a certain percentage of their income. If property taxes were raised above that threshold, the taxpayer would not have to pay, and the state would make up the difference.

But the circuit breaker would not take effect unless the state was running a budget surplus, which Paterson predicts will occur in future years, if a state spending cap is in place.

The meeting with legislative leaders ended without coming to any conclusions about how to close the growing budget gap, though all of the major factions said they agreed with at least some of the governor's ideas. Paterson says he still intends to hold a special session on November 10th, and possibly keep the legislature in Albany for days, until a conclusion is reached on how to close the deficit.

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