U.S. Sen. Charles Schumer said Saturday that New York schools and the state will get much of their federal stimulus cash by the end of this month, a critical timeframe for budgeting that affects state and local taxes.

The New York Democrat says schools will get half of their share of the federal stimulus package as school boards statewide and mayors of the biggest cities prepare 2009-10 budgets. The early release means school districts will have as much as millions of dollars more to help them avoid raising the nation’s highest property taxes.

For New York state government, the cash comes as the Legislature and Gov. David Paterson negotiate a budget. The roughly $120 billion spending plan is projected to have a $14 billion deficit.

New York is getting $24.6 billion over two years in economic stimulus.

Schumer said late Saturday that school districts will need to obligate 85 percent of their stimulus funding by the end of 2010, with the remainder needed to be allocated by the end of September 2011.

Albany will get two-thirds of stimulus funding this month to create jobs through public works projects and to avoid raising more taxes. If the state can show the need for more, Paterson can request up to 90 percent of the balance. That will likely create an additional pressure in negotiating a 2009-10 budget with the Legislature, which has many members fighting cuts to powerful special interests in the health care industry and in many other areas of the spending plan.

Paterson also has proposed about $4 billion in new and raises in narrow taxes — not the income tax, for example — and fees. The Democrat has said he’s willing to use some of the stimulus to roll back the tax increases, but warns that if the Legislature uses the historic stimulus to ease New York out of its current fiscal crisis the state, because of overspending, will likely face another crisis in two years.

(Source: NBC New York)