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State leaders began to complete their unfinished budget work last week, agreeing to spend part of their surplus federal welfare dollars on child care for low-income families.

On September 28, the state transferred $304 million in federal Temporary Assistance to Needy Families money to a fund that subsidizes care for low-income working families across the state, including nearly half of New York City’s child care spending.

After months of failed negotiations, other state budget disputes have also been resolved, Albany sources report, including agreement on a plan to allocate all of this year’s $1.4 billion surplus in welfare funds. In New York State, these dollars fund a broad range of poverty-fighting programs, from earned income tax credits to job training. Precise information on how the surplus will be divided is not yet known, but observers expect expenditures to be similar to previous years. The surplus agreement will be ratified when the state legislature returns to session on October 15.

What’s still up in the air is whether Gov. George Pataki, Senate Majority Leader Joseph Bruno and Assembly Speaker Sheldon Silver will reach agreement on a supplemental budget to restore the billions of dollars in cuts that were passed in the “bare-bones” budget of late July.

Albany officials have been mum about their intentions so far, leaving observers with more questions than answers. “The important discussions have gone subterranean, even more so than usual,” noted Russell Sykes, the deputy director of the Schuyler Center for Analysis and Advocacy, a statewide policy advocacy organization. “On one hand, this child care spending is a good sign that they will come together on the 15th and pass a supplemental budget. But you never know-budget-making in Albany is such a dysfunctional process.”

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