SALEM — The official start of the 2009 Oregon Legislature is still weeks away, but a dismal new state revenue forecast has focused lawmakers’ immediate attention on patching together budget deals to keep key state programs afloat.

“Members of the Legislature need to roll up their sleeves and begin finding ways to close these budget caps,” Oregon Senate President Peter Courtney said after receiving word that state government is facing an immediate $142 million shortfall.

The state’s new revenue forecast also predicts the state will be at least $830 million short of the amount needed to maintain current services in the next two-year budget that begins July 1.

State Economist Tom Potiowsky delivered the grim news to lawmakers Wednesday, saying that Oregon’s economy could well get worse before any recovery begins.

In response, Democratic Gov. Ted Kulongoski used his executive authority to order agencies to make across-the-board cuts that will translate to about 1.2 percent of each agency’s current two-year budget. Because there are only six months left in the current budget, the cut will be closer to 5 percent of what each agency has to spend until the budget expires in June, Kulongoski’s office said.

“This recession demands tough decisions and requires shared sacrifice — and today’s action is the first of many difficult decisions that lie ahead,” Kulongoski said in a statement.

By law a governor can order across-the-board cuts by agencies. Only the Legislature can cut selectively, and leaders indicated Wednesday they might fine-tune Kulongoski’s cuts when the 2009 session begins in January to protect vital services.

State Rep. Dave Hunt, who will be the next Oregon House speaker in January, said the governor by law “only has a meat cleaver” to make across-the-board cuts.

“There is a high likelihood that the Legislature will make cuts that will allow us to be more exacting,” the Clackamas Democrat said.

Potiowsky issued his quarterly revenue forecast only a few days after the release of what he called a “horrible” state jobless report. It showed that Oregon’s unemployment rate soared to 7.3 percent last month, well above the national average of 6.5 percent.

He said Oregon’s economy is in the same downward spiral as the rest of the nation, with home prices falling, thousands of Oregonians losing their jobs and consumers “missing in action,” and not spending on anything beyond the essentials.

In their latest report to lawmakers, state economists said state income-tax collections will be down another $166 million in the current two-year budget period. That prompted Kulongoski to use his executive authority to order cuts to eliminate the potential shortfall.

Lawmakers also were told that projected income for the next two years will be down $718 million from the previous forecast in September.

That means the state’s general fund-lottery budget for 2009-2011 is now projected to total about $16.1 billion. That’s about $830 million short of the $16.9 billion that would be needed to maintain state services and aid to public schools at current levels, according to Ken Rocco, the Legislature’s chief budget analyst.

On Dec. 1, Kulongoski is to release his proposed 2009-11 budget that will have to take into account the sharply reduced revenue available for the next two years.

That could translate to less money for schools, universities, human services, state police and other state services.

On Wednesday, legislative leaders indicated they are not eager to spend the $800 million they’ve socked away in a rainy day fund and other savings accounts because nobody is sure how bad the economy will get.

Perhaps not surprisingly, there were sharply differing views among the majority Democrats and minority Republicans about how to deal with the large revenue shortfall in the next two-year budget period.

Republicans said sustainable, prioritized state spending — not tax increases — is the way to get the state though the economic crisis.

“Rather than finding new ways to extract more money from Oregonians, we will work to put more money back into their pockets and back into the economy,” said House GOP Leader Bruce Hanna. “The Legislature just creates a better environment for businesses that helps them succeed and create jobs.”

On the Democratic side, Courtney said lawmakers will need to consider a combination of budget cuts as well as raising additional revenue to protect the state’s most vulnerable citizens and vital services.

“I cannot turn my back on people who are hurting now; I cannot release criminals onto the streets; and I cannot allow our schools to shut down,” the Senate president said.