Paterson directs cut in aid payments

(AP) - Gov. David Paterson says New York has run out of cash and he's directing budget officials to reduce aid payments to schools, local governments and non-profit service providers until things improve.

Budget Director Robert Megna says the state faces a negative general fund balance of more than $1 billion at the end of December, which would be a first for New York.

Speaking Wednesday at the Museum of American Finance, Patersonsays he'll probably get sued but he won't let the state run out ofmoney on his watch.

Megna's office plans shortly to detail cuts.

Last week, after lawmakers agreed to cuts of about $2.8 billion,Paterson said it wouldn't be enough, warning of reduced and delayedpayments, targeting school aid and funding to hospitals.

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