"Well, I think the concept will come back. I don't know that it will work, because I don't know if people understand why the M.T.A., structurally, can never be profitable because it just doesn't raise the revenues relative to the services it provides," Paterson told John Gambling on WOR.

The proposal—pushed hard by Michael Bloomberg in 2008—died when it was never voted on in the State Assembly. Michael Daly this morning blamed Speaker Sheldon Silver for the M.T.A.'s current fiscal woes, and Silver earlier this week blamed Bloomberg for congestion in the city.

Paterson yesterday vowed to restore cuts to student Metrocards, the most controversial of the M.T.A.'s proposals to save money.

"Had we established the tolls, the M.T.A. would not be in the difficult financial situation right now causing the M.T.A. to take some very drastic actions, one that I promise to reverse, which would be charging fares to young people for the use of their Metrocards as they go to school," David Paterson said as he signed an order preventing discrimination against transgender individuals. He hinted at this yesterday.

"Because they have to go to school in the same way that people upstate who are objecting to the license plates have to go to work and use their vehicles," Paterson said. "The only reason I haven't said I'm directly going to do it is I want the public to understand that revenues have to come in to the level that would allow me to do that."

Paterson does not have the power to do this directly, but he could probably make it happen by sending the authority money, which he can't do right now.

Paterson was asked during the signing of a bill to increase oversight of public authorities—including the M.T.A.—if he had any message for Walder, especially because Paterson took $143 million from the authority as he bridged a mid-year budget deficit.

"We reverted to any and all ways to try to reduce deficit. I don't have a message for the M.T.A. chair," Paterson said. "He is under the same unfortunate constriction that I am, which is that revenues are down, projected revenues are less than what they were supposed to be, and therefore in order to save the financial stability of the Metropolitan Transportation Authority, he will make whatever decisions he feels are appropriate, along and in consultation with the M.T.A. board. I will withhold at the end of this month to make sure that the state doesn't run out of cash and meets all its obligations at the end of the year."

State officials this spring agreed to a massive bailout for the authority, including a tax of 34 cents on every $100 of payroll in the 12-county M.T.A. service region. That tax is generating less revenue than projected.

They've been decrying the bailout bill for the authority, which included the underperforming payroll tax, since it passed in May without their votes. One major complaint is that the legisation evenly distributes money across all counties in the M.T.A. service area, regardless of ridership numbers or voting power on the authority's board.

"My guess is the payroll tax will do no better, primarily because you've got businesses shutting down or eliminating jobs. Leave it to New York," said Assemblyman Marc Molinaro of Dutchess County. He, along with Joel Miller and Greg Ball, has been blasting the M.T.A. and called earlier this year for an audit of the authority. Yesterday, Ball—a candidate for State Senate—called for a "tax revolt" by affected businesses. Molinaro said he has spoken to dozens of civic groups since the bill's passage, the last one on Tuesday.

"It's not like I vote some way just so I can say, 'I told you so,' but we know what we're getting in the Hudson Valley, and to be told by others that we should take the medicine anyway is obscene," Molinaro said. He believes there will be political consequences for those who voted in favor of the tax, and thinks the M.T.A. is in a severe bind now.

"Because of the bailout, they won't get anywhere with New York City. So it's not as though they can go back to the drawing board. The city Democrats are not going to give them an inch. They're not going to be able to cut services and resources in the city and they've overtaxed the Hudson Valley, so we're screwed," Molinaro said. "They're not generating the revenue. They're not going to be able to pay their bills, let alone provide more services. It's the standard Albany practice of not taking a comprehensive, complete look at things."

The M.T.A.'s top financial official told the authority's board that a payroll tax--passed in May to avoid fare hikes and service cuts--is not providing as much revenue as projected, by about $200 million.  That comes on top of a $143 million sweep of M.T.A. funding in the just-enacted deficit reduction bill. In short, the authority needs money.

So State Senator Carl Kruger, the chairman of that chamber's Finance Committee, put out a statement late yesterday that is a mixture of denial and M.T.A.-bashing. Here it is:

"Our ability to budget is only as good as our ability to forecast. We were dependent upon data supplied by the Office of Management and Budget with the understanding that it was verified by the MTA's own fiscal staff.

"Furthermore, our projections were based on the fiscal year rather than the calendar year. This critical point should have been taken into account when the MTA fiscal staff developed its parameters.

"It is my shared belief that the payroll tax will 'kick in' when the dust settles and smaller employers start making their mandatory contributions. It may not happen in the calendar year, but it will happen in the fiscal year. Since our cuts were calculated on a pro rata basis for the fiscal year and not the calendar year, for the MTA to charge its books with a cut of $143 million in the calendar year obviously has a more severe impact than spreading it out over the fiscal year.

"It is my hope that the MTA will not create an atmosphere of confusion or a needless sense of unrest over what appears to be self-adjusting bookkeeping issues. We all recognize that shortfalls are real and that expenditures are exceeding revenues. That is why we're addressing the situation in this manner.

"I look forward to discussing with MTA Chair/CEO Jay Walder ways that the MTA can better serve our community and become a stronger partner in developing new avenues of revenue, savings and cuts without affecting the riding public during these difficult economic times."

This has become Kruger's shtick, and a fact of life in Albany. It was principally Kruger who hamstrung the Senate in the spring and prevented the chamber from enacting an M.T.A. package that included bridge tolls--a balanced approach favored by a broad coalition, and StreetsBlog, too, smells a reprise.

"Instead of a five-year transportation capital program, Governor Paterson saw fit to release his take on the plan while simultaneously striking it down and placing the onus on the legislature. While I agree that the plan must be 'fiscally prudent,' amongst other criteria, as Chair of the Senate Transportation Committee I would like the time to review the plan before its publicly written off," Dilan said, in a statement.

"While I understand the State's fiscal predicament, and applaud Governor Paterson's efforts to remedy it, I cannot condone actions on his part to undermine the legislature and be both the judge and jury on an issue as important as statewide transportation. If the Governor wanted a 'need-based' priority plan, he should have asked the executive agency responsible for drafting one to do so."

Republicans, meanwhile, are reminding us that they predicted that upstate areas would be bypassed when funding for roads and bridges was de-coupled from funding for the M.T.A.

Scott Reif, a spokesman for Senate Republican Leader Dean Skelos, said they have "proven their word is no good."

"When the New York City-dominated Senate Democrat conference rammed through an MTA bailout plan and completely ignored Upstate's transportation needs, they asked its residents to trust them to deliver an Upstate road and bridge plan this fall," Reif said.

Paterson indicated he would support neither plan, and said that "if the Legislature does not work with me to address the budget deficit, it will become increasingly difficult to enact a necessary and affordable road and bridge plan for New York."

Paterson today also tasked legislative leaders to come up with ideas for bridging the state's current budget gap, which is at least $2.1 billion. He has staked his political rehabilitation to his fiscal management, and tasked Lieutenant Governor Richard Ravitch with much of nitty-gritty work.

In May, lawmakers passed (and Paterson signed) a bill to bail the M.T.A. out of a multibillion-dollar deficit, but the amount dedicated to capital projects downstate was about $10 billion short.

To the dismay of Republicans playing a regionalist card, no provisions at the time were made for upstate roads and bridges; a plan was released today by the Department of Transportation.

"This is exactly what they worried about in May—not getting some source of funding nailed down for both plans at the same time," said Neysa Pranger, a spokeswoman for the Empire State Transportation Alliance. She said that the un-enacted parts of the M.T.A. capital plan could result in later phases of marquis projects like the Second Avenue Subway being stalled.

Here's the statement from David Paterson:

"Today the State Department of Transportation submitted their proposed 2010-2015 five year capital program as required by the MTA financing legislation I signed into law earlier this year.
I commend Acting Commissioner Gee and his staff for their work in submitting this plan and pointing out the infrastructure investments needed to renew our transportation system.
Unfortunately this plan, and the plan the MTA submitted on October 1, are simply unaffordable given New York's current fiscal condition. I will not agree to raise taxes, which would be required to fund these plans, as Congress has not renewed the federal multi-year transportation program and State revenues continue to decline.
If the Legislature does not work with me to address the budget deficit, it will become increasingly difficult to enact a necessary and affordable road and bridge plan for New York. We cannot afford a multi-year plan until the economy improves, the federal government provides adequate multi-year funding, and the Legislature joins me to seriously address the structural imbalance in the state budget. This plan must be need based; fiscally prudent without relying heavily on bonding; balance transit, rail and highway needs; and support the economic growth of New York."