Gov. Linda Lingle suggested today that lawmakers use money from the federal stimulus package, cuts to public-employee health benefits and further restrictions to high-technology tax credits to close a $650 million revenue shortfall.

The governor discouraged any new tax increases as well as layoffs or furloughs of state workers.

Lingle's recommendations were based on the revenue picture provided by the state Council on Revenues in January.

The state, using the council's forecast, had identified an $81 million deficit for the fiscal year that ends in June, a $315.4 million deficit for fiscal year 2010, and a $549.8 million deficit for fiscal year 2011.

The council is scheduled to update its forecast next week and many predict that the revenue picture will worsen.

If the forecast is downgraded, Lingle said she would likely have to suggest additional steps to lawmakers to close the deficit.

Lingle, at a news conference at the state Capitol, outlined several proposals to address the shortfall.

The governor would use $320 million in extra federal Medicaid reimbursement

payments to plug the gap.

Lingle would save $96 million through cuts to state employee healthcare benefits, although this proposal would have to be worked out with labor unions in collective bargaining.

The governor would siphon $33 million by transferring tobacco tax revenues to the general fund.

The governor estimates the state could generate $40 million by moving up collection of general excise tax revenues.

And the governor would save an additional $43.9 million by tightening the Act 221 technology tax credits.

Lingle, in response to questions by reporters, drew the line on new tax increases, arguing that it would hurt people struggling through the declining economy.

State House and Senate Democrats, who had discouraged talk of tax increases

earlier in the session, are moving several bills that would raise taxes to help close the budget deficit.

Lingle had initially said she would wait until the council's new forecast before giving lawmakers updated budget figures. But she said she changed her mind after lawmakers indicated they wanted to hear her recommendations.

The state House is scheduled to complete its draft of the budget by the middle of this month, when it will send it over to the state Senate for consideration.