ALBANY, N.Y. (AP) — The state budget approved by Gov. Eliot Spitzer and the Legislature will raise state spending to $123.6 billion, an increase of 8.2 percent and $2.9 billion more than originally reported, state Comptroller Thomas DiNapoli said Thursday.

The comptroller's annual report said Spitzer and legislative leaders were able to come in with the lower bottom-line figure in their accounting by shifting spending into the old fiscal year and by not counting as spending everything they should have. DiNapoli was not pleased with the final product.

"Thanks to Wall Street, there's been a lot of economic vitality in New York state," said DiNapoli. "But that doesn't mean we should break the bank year after year. The out-year budget gaps are big and getting bigger. Spending is increased by three times the rate of inflation. Our debt service will soon surpass $5 billion a year. That's $5 billion that we're not spending on health care or education or property tax relief."

Paul Francis, Spitzer's budget director, said that much of the extra spending that DiNapoli said he identified has "historically not been included" when determining the final size of the budget and is spelled out in other state fiscal documents.

"It is highly misleading for the comptroller's office to imply that state spending was somehow higher than was initially reported," the Spitzer aide said.

Nonetheless, Francis said it might be worthwhile for all sides to take a fresh look at what should be counted as part of the budget.

DiNapoli said the new budget, which he said is technically in balance with revenues matching expenditures, creates projected deficits of $3.1 billion for the 2008-09 state fiscal year that begins April 1, 2008; $4.8 billion for the 2009-10 fiscal year; and $6.6 billion for the 2010-11 fiscal year.

The report noted that in the decade that ended on March 31 of this year, state-funded debt had grown by 54 percent to $51 billion. DiNapoli said the new budget means $26.3 billion in additional debt over the next five years.

"The state is running up its credit cards even though we have cash in our pockets," he said. "It's fiscally imprudent."

DiNapoli said state leaders should be putting more money into reserve funds and toward paying down state debt.

The new budget, adopted on April 1, relies on $1.9 billion in non-recurring revenue.

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