RICHMOND (AP) -- Virginia's budget shortfall could be as large as $2.9 billion, nearly triple the amount legislators predicted last month, state finance officials said Tuesday.

A report prepared by the Virginia Department of Taxation and presented to the Governor's Advisory Council on Revenue Estimates projected the shortfall at $2 billion to $2.9 billion, depending on how quickly the slumping national and state economies begin to recover.

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Regardless of the exact figure, major cuts in state spending will be required. Gov. Timothy M. Kaine already had ordered state agencies to submit plans for cuts of 5, 10 and 15 percent. Those plans are due Friday.

In remarks to open the council meeting, Kaine said he wants to wait for fiscal results from the quarter ending Sept. 30 before officially revising the state's revenue forecast and deciding how to cut spending. The first-quarter data should be available by Oct. 10, he said.

The governor said he will try to impose a number of "ongoing spending reductions" that will carry over from 2009 and make it easier to balance the budget in 2010. He offered no specifics but has said previously that areas historically protected from budget cuts, including public education, could be affected.

Kaine had warned of a looming budget shortfall but refrained from quantifying it, leading lawmakers to speculate that the gap in the current two-year, $77 billion budget would be about $1 billion.

The revenue problems are largely a result of sagging income tax and sales tax collections toward the end of fiscal year 2008, Kaine said. According to the report to the council, withholding receipts were about $77 million short of the forecast in 2008, and sales tax collections were $21 million short.

"The trend lines are going in a bad direction," Kaine told the advisers.

Kaine said most economists now say the nation is in a recession. How long the recession lasts depends in part on what happens with the proposed $700 billion federal bailout of the financial services industry, he said.

(Copyright 2008 by The Associated Press.  All Rights Reserved.)