Approving craps in the Catskills wasn’t the only news to come out of Albany last week. The state legislature and Governor George Pataki also agreed early Thursday morning to spend $1.5 billion in surplus federal welfare dollars for the fiscal year ending next March, a move that sent sighs of relief through the world of social services.

In large part, the spending package for surplus Temporary Assistance to Needy Families money, meant for programs that fight poverty and help move welfare recipients to work, is the same as last year’s: $457 million will go to child welfare programs, $304 million to child care and $3 million to case management for homeless families.

Not all programs fared that well, however, as job trainers took a more than $200 million hit. New York Works, which helps prepare mentally ill and disabled welfare recipients for jobs, is one of the biggest losers, receiving only $60 million of the $210 million it was allocated last year. However, some observers say New York Works and other job training programs were slow to spend last year’s funding, so that unspent cash should tide them over this year.

Albany watchdogs question this budgeting strategy, however. “When some of these programs run out of money next year, will they remember this year?” wondered Ron Deutsch, executive director of SENSES, the Statewide Emergency Network for Social and Economic Security.

Education and health programs were also slashed in half: Preventive services, which try to keep children in troubled families out of foster care, will go from $30 million to zero; home visiting services for mothers and infants gets $9 million less than last year. At press time, however, it wasn’t clear if these decisions will eliminate services.

At least one program will see a big jump in TANF funds, though. The earned income tax credit, a tax cut for low-income families lauded by conservative legislators and progressive activists alike for increasing the incomes of New York’s poorest working families, has grown to $384 million from $173 million last year. While Deutsch is glad to see poor families get money where they can, he questions using TANF money to fund a tax break. “Every other tax cut in the state is paid for with the general fund,” he said. “Why should programs that benefit low income families take a hit to support this particular cut?”

Despite any concerns, there is a newfound understanding in Albany that some cuts are necessary given the difficulty in projecting how hard the events of September 11 and the growing recession will hit state budgets. “Sure a $2 million cut is worrisome,” said Edie Mesick of the Nutrition Consortium of New York State, an Albany-based anti-hunger group that advocates for food pantries and soup kitchens, which will receive $12 million instead of $14 million this year. “But it could have been much worse.”