AUGUSTA – A top expert in the tax department of the Maine state government said Monday he likely will recommend that revenue projections for the current fiscal year be scaled back by $110 million to $150 million.

A cut of that size would force Gov. John Baldacci and the incoming Legislature to find ways to make up the difference before June 30, 2009, the end of the 2009 fiscal year.

A revenue reduction on the upper end – $150 million – would amount to about 5 percent of the current revenue estimate for the year.

Michael Allen, director of econometric research for Maine Revenue Services, said a key factor favoring a downward revenue reprojection would be anticipated taxpayer losses on Wall Street reducing income tax revenue.

Allen outlined his thinking at a joint session of two panels that direct state revenue projections.

Revised state revenue estimates are due by Dec. 1, just ahead of the seating of a new Senate and House of Representatives.

But administration officials, already looking for options to scale back state spending, called for joint discussions to help them speed up their planning. Those discussions would involve the Consensus Economic Forecasting Commission, headed by Charles Colgan of the University of Southern Maine. They also would include the Revenue Forecasting Committee, which is headed by acting State Tax Assessor Jerome Gerard and which makes the actual revenue projections.

“The economic situation for Maine, while worse than thought, is not catastrophic,” the Consensus Economic Forecasting Commission said in its new report released Monday.

The commission report said employment and income growth are expected to be lower than forecast in January, “but still better than headlines would lead one to believe.”

The commission also said “Maine will experience a tough fourth quarter,” resulting in negative job growth for the year, and that 2009 will show job losses and slow income growth.

“A slow economic recovery will start in 2010, with a return in 2011-2013 to historical trends in employment and income growth,” the commission report added, with a caution that volatility in the national economy makes the latest forecast riskier than past ones.

“For comparison purposes, the current economic outlook for Maine may be similar to the recession seen in 1980-1982: about seven quarters of employment decline and then six quarters of recovery,” the commission report said.

“In the near term, Maine’s economic climate may be worse than the mild recession in the early part of this decade, but better than the one in the early 1990s.”

Baldacci has directed agency heads to outline 10 percent reductions in their proposed spending. The state appears to be facing a gap of around $500 million for the two-year budget cycle that starts July 1.

Agencies also have been directed to self-fund any supplemental budget requests to address shortfalls in the current fiscal year, which has eight months to go.