ALBANY -- Gov. David A. Paterson on Monday said times have changed for the state since his administration last year signed a no-layoff pledge with public employees unions -- and that the planning for job cuts in the state government should begin "immediately."

With the State Legislature set to return Wednesday for a special session to try to close down the 2010 budget, Paterson ratcheted up the rhetoric about possible state worker layoffs. For months, he has warned of looming layoffs, but never put forth a plan to begin the reductions.

"Some unfortunate people who don't deserve it are going to get laid off, and it burns me to have to say that because I don't think it's fair to them," Paterson told reporters after throwing out the first pitch at a little league T-ball game at a park near the Capitol.

The governor blamed unions for not agreeing on plans to more broadly spread the pain across the work force -- such as through furloughs or a pay freeze. "We didn't get any cooperation from the unions in negotiations," Paterson said.

The governor's administration last year signed a memorandum of understanding with the Civil Service Employees Association and the Public Employees Federation to not lay off -- or even threaten to lay off -- any state workers before Dec. 31. In return, the unions supported Paterson's plan for higher pension contributions for newly hired state and local government workers.

But Monday, Paterson dismissed the legal significance of that memorandum, saying the terms can no longer be met because the state has seen a major drop the past year in tax revenues and now faces the potential loss of $1 billion in planned federal Medicaid reimbursement funds. "It was a plan," Paterson said. "It was certainly something we would have adhered to if conditions made it possible.

"We're going to have to ask for greater sacrifice," the governor said, referring to layoffs instead of spreading the pain across the work force witha pay freeze.

Paterson did not set a date for possible layoffs to begin. The administration also is awaiting the results of a newly offered early-retirement incentive program for state workers. to determine the extent of savings from that effort.

Union leaders condemned the governor's latest layoff threat, with PEF, which represents white-collar state workers, suggesting legal action if Paterson tries to break the memorandum.

Danny Donohue, president of CSEA, called the governor's comments "counterproductive, impractical and bad for New Yorkers all around. They might also constitute bad-faith bargaining."

Both unions say Paterson has failed to give an adequate chance for the early-retirement program to work -- an effort they think could negate any need for layoffs.

"All New Yorkers would be better served if Gov. Paterson would stop his inflammatory public statements and instead work with the Legislature and other parties to solve the state's challenges," Donohue said.

The governor met Monday afternoon in Manhattan with with Assembly Speaker Sheldon Silver and Senate Democratic Conference Leader John Sampson. Before the meeting, Paterson said there were "some indications" that the two legislative leaders have some new ideas to break the stalemate over the budget.

No deals were announced following the meeting, however. Legislative leaders did present the governor with some "alternative" ideas to resolve some of the existing stalemates; Paterson was reviewing them Monday night.

It is uncertain what, if anything, lawmakers will do when they return to town to comply with Paterson's call for a special session Wednesday night. Legally, they can do nothing by simply gaveling into session and then breaking. Moreover, it is uncertain if the Democrats who run the Senate will even get all 32 of its members in their seats to pass the final budget bill.

There is no budget in place for the fiscal year that began April 1 -- which is when lawmakers were last given paychecks under a law that holds their pay until a fiscal plan is adopted.

One major bill -- accounting for about $1.5 billion in new revenue-raising steps -- remains to be passed by the Senate. On the table also is a Medicaid contingency fund to plan for the potential loss of $1 billion in federal aid.

Paterson also wants lawmakers to address a plan pushed by the State University of New York to permit the system to increase tuition on an annual basis, to keep those proceeds for campus operations and to more easily enter into business deals with private companies.

The governor also will ask lawmakers at this week's special session Wednesday -- and likely Thursday as well -- to back his call for a cap on annual growth of local property taxes; the idea has died in the Assembly several times already this year.

Austin Shafran, a spokesman for Sampson, said the Senate leader wants any final budget deal to also include the state university plan, Medicaid contingency fund and some sort of property tax relief.

The governor also wants lawmakers to -- again -- consider his plan to raise taxes on sugar-flavored beverages and to permit grocery stores to sell wine -- two ideas both houses have dismissed since last winter.

tprecious@buffnews.comnull