BUFFALO - New York state's budget hole may be some $300 million deeper than estimated just three weeks ago Gov. David Paterson suggested Monday on the eve of releasing his latest economic forecast.

“You will find that it is a very dismal and unfortunate situation that we are in,” warned Paterson, who is pressing the state Legislature for drastic action when it convenes for an emergency special session next month.

During a stop in Buffalo, Paterson said the deficit for the current fiscal year is nearly $1.5 billion. Preliminary estimates Oct. 3 put the number at $1.2 billion, prompting Paterson to tell New Yorkers then to prepare for fewer services and potentially higher school and property taxes.

It gets even worse down the road, he said Monday, estimating the gap for 2009-10 will be twice what he thought back in July,