AUGUSTA -- Wall Street's wild ride, with recent deep dips, has meant a nearly $3 billion drop in assets since July for the Maine Public Employees Retirement System.

On July 1, assets held by the system totaled $10.5 billion, but as of Wednesday, assets had dropped to $7.6 billion, said Peter Leslie, chairman of the retirement system board. That's a 28 percent drop.

"It puts us pretty much in the same boat as public-retirement systems all around the country," he told members of the Legislature's Appropriations and Financial Affairs Committee.

Leslie, and others reporting to lawmakers, delivered grim economic news one day after Gov. John Baldacci issued a curtailment order to curb state spending by $80 million for the budget that runs through June.

Baldacci issued the curtailment in an effort to address declining state revenues for this budget year and beyond. The total General Fund shortfall for the current budget year is likely to be $142 million, said Michael Allen, director of economic research for Maine Revenue Services.

In mid-December, Baldacci will submit a supplemental budget to lawmakers that will include the curtailment and additional cuts to close the budget gap. Ryan Low, commissioner of the Department of Administrative and Financial Services, said the $80 million curtailment is a starting point.

"This is only halfway to the $140 million we have to address this budget year," he said.

In addition to reports of declining assets in the state retirement system, and falling state revenues, lawmakers got an update on the state's cash pool, which was down by more than $181 million in October compared to a year ago, said state Treasurer David Lemoine.

Rep. Emily Cain, D-Orono, tried to lighten the mood by asking Allen whether he had any good news to report.

His answer? Gas prices are dropping, he said.

And for those who get benefits from the retirement system -- despite the recent losses -- there's more than enough money to pay out benefits for years to come, said Gail Drake Wright, executive director of the retirement system.

"The money we have will pay those retirement benefits way, way into the future," she said. "There's no immediate danger of there not being sufficient cash to pay those benefits."

The retirement system has more than 90,000 members, which includes current and retired state employees, teachers, legislators, judges and others.

Leslie said that in over 50 years of experience with investing, he's seen nine "events" similar to what the economy is currently experiencing. "This one is clearly the worst," he said. "Not only have stocks collapsed, but the credit systems have been paralyzed."

Adding to the current problem is a global economy in which one country or group of countries isn't able to help other world economies, he said. And the wild swings in the stock market are "worrisome," he said. At its peak, which came in October 2007, the retirement system had $11.6 billion in assets.

Last fiscal year, the system paid out $541 million in benefits. On the state revenue side, Allen said figures show General Fund revenues are down $18 million since July 1.

The losses come from all major state revenue lines, including the sales and use tax, where lodging was down 12 percent in September compared to last September.

"I can't remember a month where lodging sales were down that much," he said. Number crunching will continue at the Statehouse today, when revenue forecasters are scheduled to meet.

Susan Cover -- 620-7015

scover@centralmaine.com