Moody's Investor Services cautioned that America's AAA sovereign credit rating could be downgraded on its "stretched" debt affordability.
The governor -- and the state comptroller, Alan G. Hevesi, a Democrat -- objected to the deal on the ground that stretching the debt out over 30 years would cost state taxpayers roughly twice as much as paying off the debt over the next 5 years.
But this year the company, stretched by debt, lost its top-rung AAA credit rating.
In the 1970's, New York's many hometown banks were involved in the city's recovery, stretching out debt payments and working closely with city officials to get its house in order.
Last week, at the annual meeting of the Financial Control Board, which monitors the city's finances,, Mr. Pataki reiterated his longstanding distaste for stretching out debt at the expense of the besieged state budget.
With government finances already stretched, and debt more than twice the size of the Japanese gross domestic product, officials have increasingly been turning to the Japanese central bank to do more to counter deflation and get funds flowing again in the economy.
Mr. Pataki said the $1.8 billion package of measures aimed at helping the city weather its fiscal crisis contained too many tax increases and would impose an unfair burden on future New Yorkers by stretching out debt from the 1970's into the 2030's.
Four city pension systems made crucial loans, and banks agreed to stretch out city debt payments.
In recent days, as the idea of allowing Greece stretch out its debt payments gained traction, the bank set itself up as the main opposition.
"Greece should be considered solvent and should be asked to service its debts," Mr. Bini Smaghi said Monday, signaling that the bank remained firmly opposed to any plan to allow Greece to stretch out its debt payments or oblige investors to accept less than full repayment, a so-called haircut.
