Capping weeks of secretive negotiations and intense political jockeying, Gov. Andrew M. Cuomo and leaders of the Legislature on Sunday announced a $132.5 billion budget agreement that would cut overall spending, impose no major new taxes and begin a long-term overhaul of New York State’s bloated Medicaid programs.

The agreement, five days before the March 31 budget deadline, offered the prospect of Albany’s first on-time budget in five years. If enacted by lawmakers, the deal would cut the state’s overall year-to-year spending for the first time in more than a decade.

While some details were not available on Sunday night, the outlines of the deal suggested that Mr. Cuomo had won a significant victory in his battle to rein in state spending and corral the unions and other special interests that have long dominated the budget process in Albany. It would also fulfill one of Mr. Cuomo’s main campaign pledges: to avoid new taxes in addressing the state’s financial problems.

Dashing the hopes of many Democratic lawmakers, including the bulk of the New York City delegation, the budget did not include an extension of a temporary income tax surcharge on wealthy New Yorkers, a measure that has drawn support among Democrats and even some Senate Republicans as a way to further offset Mr. Cuomo’s proposed cuts in money for schools and other programs.

Mr. Cuomo persuaded legislative leaders to agree to a year-to-year cut of more than $2 billion in spending on health care and education, historically the two largest drivers of New York’s budget. Over all, officials said, the budget deal would reduce year-to-year spending by about 2 percent.

For both Medicaid and education, the deal calls for a two-year appropriation instead of the traditional one year’s worth of financing, locking in fixed rates of growth through Mr. Cuomo’s second year in office and potentially allowing him to avoid a repeat of the battles he fought this year with teachers’ unions and other special interests.

In exchange, Mr. Cuomo agreed to add $250 million — a modest amount by Albany standards — to his executive budget proposal, including more money for schools, the blind and the deaf, human services, higher education, and prescription drugs for the elderly.

Mr. Cuomo and the legislative leaders said they hoped the agreement would signal a new day of responsible budgeting and effective government in a Capitol long criticized for its gridlock and dysfunction.

“This budget brings the power back to the people,” Mr. Cuomo, a Democrat elected last fall, said at a news conference at the Capitol, where he was joined by both parties’ leaders in the Senate and the Assembly. “For them to see their government functioning this way, it’s a new day in New York. We set out to build a new New York, and this is the first step down that road.”

Mr. Cuomo succeeded in part by aggressively wielding a tool pioneered by his much-maligned predecessor, Gov. David A. Paterson: He threatened that if lawmakers missed the budget deadline, he would put his preferred cuts into an emergency spending measure, forcing them to vote for his budget or risk shutting down state government. That pressure helped drive lawmakers to the table in recent days, because refusing a deal with Mr. Cuomo would have meant giving up what scant restorations the Legislature had been able to wring from him.

Seeking to avoid the blistering attack ads from labor unions and hospitals that have pummeled past governors and weakened their hand with the Legislature, Mr. Cuomo also persuaded the state’s most powerful health care interests to draft a side deal with him that gave Mr. Cuomo the broad cuts he needed in exchange for concessions that would not directly affect the budget, like a “living wage” law for home care workers.

But Mr. Cuomo also made some concessions. He agreed to abandon a cap on “pain and suffering” damages for victims of medical malpractice, a controversial measure avidly sought by the hospital industry in exchange for its support of the health care cuts but strongly opposed by Assembly Democrats. A related proposal, to establish a state fund to pay for the future medical expenses of brain-damaged infants, survived the negotiations, drawing praise from hospital executives…..

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