AUGUSTA -- Gov. John Baldacci told local business leaders Wednesday that his proposed two-year budget -- and the cuts necessary to balance it -- spreads the pain to many sectors.

"We're all in this together," he told about 70 people attending a Kennebec Valley Chamber of Commerce Business Insider Breakfast. "There isn't anybody who isn't seeing some pinch."

He also repeated his belief that Maine still has too much government for a state with a small population, with an administration for every 1,500 people.

Last week, Baldacci unveiled his proposed $6.1 billion two-year budget. The budget eliminates 219 state positions, which will require 139 layoffs, requires state employees making more than $50,000 a year to contribute to the cost of their health insurance, and proposes a new retirement incentive program.

Also, it institutes 10 percent reductions in some tax rebate programs, increases fees in Marine Resources, Inland Fisheries and Wildlife and Conservation, and a proposes to send 118 prisoners to out-of-state facilities.

In the area of human services, it counts on nearly $100 million from the federal government, an amount that will have to be covered by the state if the money does not come through from Washington.