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Cut state budget further Pataki should push hard bargain to limit spending, gain real reform in Albany

Well, it's an election year, all right. State legislative leaders this week agreed to a 2006-07 budget fattened with taxpayer goodies, ignoring two years of taxpayer abuse since the last election. The gifts include a property tax rebate that would arrive just before Election Day. Talk about brazen.

But the $112.4 billion budget, on time for the second consecutive year, raises spending by $2 billion over the one Gov. George E. Pataki proposed in January; that plan already increased spending by 4.1 percent over this year. It also rejects packages of reforms Pataki proposed to control education and Medicaid costs.

The plan has several virtues, but overall, Pataki is right: It spends too much and reforms too little. It contains no broad-based business tax cut, and critics say it opens major revenue gaps in future years.

These problems may yet be fixed. Last year, Pataki and legislative leaders negotiated changes over the 10 days Pataki has between receiving the budget and approving it or issuing vetoes. Pataki says he hopes to achieve that again this year, but he also says he is keeping his veto pen handy, partly because of the difference an election year makes.

With voters paying closer attention, lawmakers are under additional pressure this year. They will not want to rescind gifts they offered voters, or make cuts in popular programs. Pataki leaves office Dec. 31 and has one last crack at using the budget to impress American voters, especially those looking for a fiscally conservative Republican. That he's doing it, despite not being around for the impact, speaks to his commitment.

The budget does boast a number of attractive proposals, including an income tax credit for families with children ages 4 to 17; eliminating sales tax on clothing purchases under $110; ending the income tax's "marriage penalty;" and a record $1.1 billion increase in school aid, most of it going to poor districts like Buffalo, which would be able to return a full-time nurse to each school. Lawmakers are finally listening.

Most alluring -- not to mention cynical -- is the property tax rebate of $300 to $800 per household. The money will be welcome for sure, but it does nothing to attack the root problem. It's "another shot of morphine that masks the problem," as one critic said. Legislators are happy to try to buy off voters this November, but in rejecting Medicaid reforms, they sent a signal that they have little interest in dealing with their role in fomenting taxpayers' misery.

With a current-year surplus of more than $4 billion, it is appropriate for lawmakers to put money back in taxpayers' pockets. It's their money. But some restraint: While lawmakers play Santa Claus to voters, they also increased spending more than $2 billion over Pataki's rich proposal. In the long run, fundamental reform will benefit taxpayers far more than tucking a few bucks into their pockets at election time. Legislators always want to spend more than the governor proposes, of course. That's just the way Albany is. It's also one reason the veto threat exists: to instill a sense of discipline.

Let's not get giddy because legislative leaders met the minimum standard, two of 20 is not a Major League average, and timeliness only starts what lawmakers need to achieve. Somewhere, responsibility and restraint must make their influences felt. The governor should help ensure they are.