The Gannett News Service reports today - “Gov. David Paterson and state lawmakers were moving toward an agreement Friday to raise income taxes on the wealthy, while agreeing to reject a proposal to sell wine in grocery stores and to find a remedy to avoid massive fare hikes on mass transit in New York City.

Paterson on Friday talked more favorably about raising income taxes on the wealthy in the face of a growing state deficit, after warning for months that a tax hike would be bad for the state’s economy. On Tuesday, he announced the deficit grew by $2.2 billion to a record $16.2 billion…

tentative agreements: freezing education aid at current levels, limiting tax increases on health insurers, restoring some cuts made to tuition-assistance programs for college students and reforming the state’s Empire Zone economic development program.

Legislative leaders also vowed to find a solution to help the Metropolitan Transportation Authority avoid massive fare increases and service cuts, which the authority board voted to do Wednesday.

The MTA is “not a part of the budget, but we will do it,” said Assembly Speaker Sheldon Silver, D-Manhattan.

Opponents appeared to beat back a Paterson proposal to allow grocery stores to sell wine, which the state estimated would bring in $105 million in new revenue.

“There’s a couple of drips left in the bottle,” said Kenneth Adams, president of the Business Council, which has been lobbying for the measure. “It’s still in play but barely.”

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