The budget plan Cuomo will unveil on Tuesday must close a gap of about $2 billion, largely through spending cuts, as Cuomo already has ruled out any new taxes or fees.
A surprise increase in revenue, which would help win the legislature's approval of an austere budget, looks unlikely.
New York's economy has not fully recovered from the recession, and the sagging performance of Wall Street - the state's main economic engine - is crimping tax collections while unemployment hovers just below 8 percent.
"Our challenge for 2012 is this: How does government spur job creation in a down economy while limiting spending and maintaining fiscal discipline?" Cuomo said in his State of the State address last week. He also proposed tapping $25 billion of private capital to spur growth and rebuild infrastructure.
State agencies already have been told to cut spending by 2.5 percent so that Cuomo can increase spending on education by about 3 percent, or around $800 million, to almost $20 billion.
While most states report slow fiscal improvement, New York is among just four states — California, Missouri and Washington are the others — that reported a budget gap halfway through their 2011-12 budget year, according to the National Conference of State Legislatures. Most states expect to meet or exceed their revenue targets, according to the NCSL's mid-year report, with New York and Delaware missing even a reduced projection for corporate income tax collections. New York's revenue outlook was lowered for the remainder of 2012 "to meet lower expectations," the NCSL report stated.
Washington's need to cut spending and debt and continued economic volatility abroad darkened the outlook. In New York, not even Wall Street's rebound is saving the state this time as bonus checks and the taxes they generate are increasingly deferred.
"Economic growth remains sluggish and the economy, fragile," state Comptroller Thomas DiNapoli said Friday.
On Friday he released his report on the third quarter of the current fiscal year, and it wasn't pleasant news for Cuomo. DiNapoli found that December tax collections were down 2.7 percent from a year before. By the end of 2011, however, overall revenues were nearly 8 percent higher than a year before in a slow recovery of fits and starts.
It already seems a long way from Cuomo's rousing and optimistic State of the State speech Jan. 4 when he bellowed: "The best is yet to be. They ain't seen nothin' yet!"
Cuomo called for a jobs program to fix crumbling roads and bridges, support of a casino company's private venture to build the nation's biggest convention center at Aqueduct race track in Queens, $25 billion in economic development grants and tax breaks to employers, and major expansion of gambling, a common crutch for Albany.
"He gave a progressive agenda in the speech, but I think in the end you aren't going to see anything different than in the first budget," Lawrence Levy, a political commentator and dean of Hofstra University's National Center on Suburban Studies.
That first Cuomo budget a year ago addressed a $10 billion deficit and made a small but rare spending cut that was supposed to be much of the pain to fix the "functionally bankrupt" Albany he inherited.
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