Gov. Paterson warned yesterday that the state could run out of money “in a month and a half” and threatened to cut short the Legislature’s summer vacation if lawmakers don’t pass a plan to pay the bills.

The governor sounded the alarm a day after delivering a historic 6,681 spending vetoes that left the state’s $134.4 billion budget at least $1 billion out of balance.

Senate Democratic leader John Sampson of Brooklyn sent his members home last week without voting on a tax bill needed to raise $950 million in revenue.

“They cannot ignore this problem,” Paterson told WOR Radio.

“They still haven’t settled how we’re going to pay for all this spending. If they don’t do that, I’m going to call them back in special session. We’re going to do it once and for all.”

The state has nearly run out of cash three times since December, requiring budget officials to withhold tax refunds and payments from local governments.

Legislative officials privately shrugged off the governor’s warning of a late-summer shortfall.

A vast majority of the budget has passed both houses and many of the proposals in the “revenue bill,” which has passed the Assembly, wouldn’t take effect for months.

For instance, a plan to end the sales-tax exemption on low-cost clothing items — bringing in some $300 million this year — wouldn’t start until Oct. 1.

Budget Division spokesman Erik Kriss said failure to pass a revenue bill worsens a cash crunch expected Sept. 1 when the state must pony up a $2 billion school-aid payment, with an additional $800,000 due not long after that.

“To have that bill enacted would give us the certainty of additional revenue coming in,” Kriss said.

“Without it we have to be more careful about how we manage the outflow of cash.”

The Legislature rejected a request to give the governor more leeway to juggle such payments on his own.

Paterson also wants lawmakers to address a potential cut by Congress to an expected $1 billion federal Medicaid payment, a move Assembly Speaker Sheldon Silver (D-Manhattan) calls unnecessary.

Meanwhile, the governor issued yet another budget veto, striking legislation that he said lawmakers altered in a backdoor effort to enact a $600 million restoration to education aid.

Austin Shafran, a spokesman for Senate Democrats, called the move a “typical Albany power play” that would add uncertainty to how state aid is doled out to schools.

(Source: NY Post)