By Gabriela Resto-Montero
DNAinfo Reporter/Producer
MANHATTAN — Governor Andrew Cuomo and State Legislators Sheldon Silver and Dean Skelos reached a budget agreement for the 2011-2012 fiscal year Sunday.
Officials said the $132.5 billion budget will reduce spending by two percent and decrease next year's projected deficit from $15 billion to $2 billion.
"I have said that New York is at a crossroads, one road leading to further dysfunction and decline, the other towards fiscal responsibility and government efficiency," Cuomo said in a statement Sunday.
"I believe this budget puts us on the right path," he said.
One of the largest impacts of the new budget will affect the state's Medicaid system, which will have a cap of $15 billion.
The new budget will also eliminate 3,700 prison beds, create 10 regional economic development councils chaired by Lieutenant Governor Robert Duffy, and will reallocate $270 million to education in addition to performance grants.