After much anticipation, Gov. Andrew Cuomo unveiled his first executive budget proposal to Albany yesterday, with a proposed $133 billion budget that includes $3.7 billion cut from the current spending plan, and no new borrowing or broad-based tax hikes. Cuomo's budget is aimed at reducing overall spending for the first time in the state in over 15 years (see the full budget here). Among the $9 billion in cuts includes $2.9 billion each in projected spending from Medicaid and local school aid; 10 percent across-the-board spending cut to state agencies; and as many as 9,800 layoffs if public-employee unions reject $450 million in annual concessions and givebacks. Cuomo was decidedly sober about the state of budget: "New York state is functionally bankrupt. In a down economy, this is a death spiral," he said.

As for NYC, Cuomo aides said the city would lose $659.4 million in real dollars, including $579.7 million in education aid (and NYC homeless shelters would lose $16 million). Mayor Bloomberg criticized the budget plan, and alleged that the city was actually facing closer to $2 billion in cuts. He told reporters the budget "does not treat New York City equitably," because it eliminates $300 million of revenue sharing aid to the city, while other localities faced a mere 2 percent reduction. "The residents of our five counties pay a disproportionate amount of state taxes, and they deserve the same level of support," he said in a statement. He also warned that this could lead to those copious teacher layoffs he previously alluded to. "Yesterday, we had $1.4 billion more [for schools] than we do today. There's no way around that," one city official told the Post.

Cuomo also removed $200 million in dedicated operating funds from the MTA's budget; with $100 million in economic development money, it leaves $100 million in losses for the MTA’s budget. John Petro from the Drum Major Institute warned that this could eventually lead to more service cuts if operating dollars aren't restored: "The MTA can trim its costs only so much before more service cuts or fare hikes are on the way. Some of these service cuts will only be slightly perceptible—dirtier train cars and stations, abandoned bus runs. If this trend of cutting operating funds continues, more severe service cuts will need to be considered."