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Sources tell NY1 the state legislature has agreed to cut about $400 million from this year's budget, which is short of the $600 million Paterson was seeking.

This year's cuts would include $140 million from Medicaid, $50 million from the City University of New York, $50 million of member items given to individual lawmakers and cuts totaling $77 million in various other programs.

The deal calls for about a billion dollars in total reductions over the next two years. Sources say much of it would come from the state and city university systems, local services and aid, and member items, which legislators tend to showcase in an election year.

The deficit next year is now expected to hit $6.4 billion, which could mean more cuts or tax increases.

The state's top Republican said even if the cuts weren't as much as the governor had hoped for, progress was made.

"What we are going to do today will translate into a billion dollars or more off of next year's deficit," said State Senate Majority Leader Dean Skelos. "So I think that's a significant start, and I believe it's historic. I don't think this has ever occurred."

Even thought the cuts fell short of expectations, Paterson expressed approval out of the session.

"This has been an exception, from what my memory of the past 20 years, where the leaders have gotten into the weeds and tried to work through some of these issues with me. And I thank them for that," said the governor on Talk 1300 Albany.

Legislators from both houses said they were satisfied with what they were able to accomplish in one day of a special session.

"I'm surprised we did as much as we did," said Democratic Cohoes Assemblyman Ronald Canestrani. "I didn't think it'd be as productive as it has been in one day, and I believe the willingness of the governor to negotiate with an open mind, meet us. He didn't get what he wanted and neither did we. We didn't want to do some of these cuts."

"So these are tough decisions, but the governor called us back to make these tough decisions," said Republican Binghamton State Senator Thomas Libous. "Spending is an issue, and I think the legislature did its job adequately and addressed the issues."

One idea that did not gain much traction was a property tax cap bill that is tied to an income tax hike, an idea outlined by the state assembly.

The State Senate and the governor balked at the proposal, but the assembly passed their own version, which is tied to the millionaires' tax.