HARRISBURG — With Pennsylvania facing a $1 billion-plus deficit for the second year in a row, Gov. Ed Rendell called on legislators Monday to increase taxes to limit the number of state employee layoffs or furloughs that are likely to result from spending cuts.

Rendell made the comments after the state government's disappointing tax collections in April threw the state budget farther out of balance and squashed Democrats' hopes that the month would begin a turnaround from two years of recession-driven shortfalls.

Through the first 10 months of the budget year, Pennsylvania is facing a $1.1 billion shortfall.

Aside from offering specific proposals to expand taxes on things like business income, natural gas extraction and cigar sales, Rendell said the Legislature should contribute a portion of its reserve that is expected to be about $180 million by the June 30 end of the fiscal year.

"If the Legislature fails to enact those revenue enhancements, then we're going to have to obviously up-tempo the level of cuts and the level of layoffs and furloughs, and I hope not to be in a position to do that," Rendell said.

He did not give any details about potential spending cuts or job cuts.

Persuading legislators to support tax increases in an election year is always a challenge, and cutting state spending falls neatly in line with Republican platforms.

Senate Appropriations Committee Chairman Jake Corman, R-Centre, said the chamber's Republican majority is worried that raising taxes will hurt private-sector hiring and investment.

The labor union that represents many of Pennsylvania state government's approximately 75,000-strong work force will support Rendell.

David Fillman, executive director of AFSCME Council 13 in Harrisburg, said it's time for the 253-member Legislature to cut its staff or find more money for the budget since the union endured three waves of layoffs last year, he said.

"The Legislature keeps talking about cuts, but they're never specific about where it goes and we're tired of being under that knife," Fillman said.

In February, Rendell proposed a $29 billion spending blueprint for the 2010-11 fiscal year that begins July 1.

But he will have to adjust that plan substantially to account for a budget deficit that is growing, not shrinking as Democrats had hoped.

The plan did not require a tax increase.

However, Rendell separately proposed a package of tax increases to put money aside for future budgets, when the state is projecting multibillion-dollar deficits after federal stimulus aid expires and pension obligations spike.

On Monday, the governor said those tax increases cannot wait, despite some signs that state revenues are beginning to reflect a wider, if uneven, economic recovery that is under way.

Corporate tax collections were running 10 percent behind expectations through the first 10 months of the fiscal year, while sales tax receipts were behind projections by 5 percent. Personal income tax collections lagged by 3 percent.

Rendell said little spending can be cut without also forcing the state to eliminate jobs. To avoid more substantial layoffs or furloughs, legislators must consider imposing new taxes on cigars, smokeless tobacco and the extraction of natural gas, he said.

Pennsylvania is the biggest natural gas state that does not tax the product. Only one other state, Florida, does not tax cigars, and Pennsylvania is the only state that does not tax chewing tobacco.

Rendell also advocated changing the law to prevent businesses based in other states to avoid paying the corporate net income tax on their Pennsylvania operations and eliminating a 1 percent incentive for retailers, including Wal-Mart, that submit sales-tax money on time.

Rendell and legislators haven't yet begun serious budget negotiations for the budget year that starts July 1. Last year, the Democratic-controlled House passed legislation imposing the new taxes on natural gas and tobacco, but Senate resistance killed the plan.