NY Gov targets clean energy, health despite deficit

By Joan Gralla

NEW YORK (Reuters) - New York state should fight obesity, help more residents get health insurance and revive the upstate economy with a research consortium for hybrid car batteries and energy storage, Governor David Paterson proposed on Wednesday.

In his State of the State annual address, the Democrat said that despite what he called the worst economic crisis since the Depression, "This is no time for fear. This is a time for action and a time for courage," he said, citing a 19th century poem, Opportunity, by Edward Rowland Sill as an inspiration.

New York's budget problems are among the most severe in the nation, partly because Wall Street's losses have deprived the state of a rich source of tax dollars.

If the U.S. government does not crack down on hedge funds and the like, Paterson warned he would enact "sensible policies" to protect investors, but offered no details.

Despite a $15.4 billion, 14-month deficit, Paterson recommended creating a $350 million fund to lend money to hard-pressed college students, which would partly be paid for with tax-exempt debt sold by the state mortgage agency.

Eager to curb obesity, which affects one in four New Yorkers below the age of 18, Paterson echoed Mayor Michael Bloomberg by calling for a ban on trans fats in restaurants and requiring chains to list the calories in their offerings.

Paterson also proposed banning schools from serving junk food. Obesity costs the state $6 billion a year in health care costs.

Building on clean energy initiatives begun by former governors, Paterson set a goal of having the state draw 45 percent of its electricity from renewable energy by 2015. This program could create 50,000 jobs, Paterson estimated.