Forum adds $260M-plus to total-revenue projections
Nevada’s Economic Forum Monday pumped another $180.1 million into the state’s total general fund revenue projected for the coming biennium, pushing total estimated revenues for the coming two years to $5.93 billion – $1.02 billion more than what was projected for the current budget cycle.
Members of the panel appointed to set revenue projections agreed the state’s booming economy justifies a significant increase in both sales and gaming tax estimates. Those two major revenue sources have been experiencing double-digit increases for most of this fiscal year.
Gov. Kenny Guinn said the projections indicate the strength of the state’s economy, and he argued the state should give residents back $300 million – which he proposed in his State of the State address in January.
“We’ve met the obligations and demands of our people, and the citizens of Nevada have every right to expect we give them back their money,” he said.
Assembly Minority Leader Lynn Hettrick, R-Gardnerville, agreed residents should get some form of rebate.
“Otherwise, we’ll just spend it,” he said.
Hettrick also cautioned the boom can’t be counted on to continue allowing such dramatic increases in state spending.
“We should be very, very careful. If we’re spending all this money, we’re setting ourselves up for serious problems.”
Senate Majority Leader Bill Raggio, R-Reno, said the increase was “about what we expected.”
“Obviously it’s not the five to six hundred million dollars everybody was throwing out there. We’ll need to look at the proposals out there and see what we can do,” he said.
Asked about some of the statements by different lawmakers that certain programs are musts for them, Raggio said: “I see some people drawing lines in the sand. Unless you control both houses, you shouldn’t draw lines in the sand.”
Senate Minority Leader Dina Titus, D-Las Vegas, agreed with Raggio that, after holes in the public school budgets and welfare among others are filled, there won’t be a lot of extra money.
“There’s not a lot left over for pet projects,” she said. “It looks like it may be a question of how much you rebate versus how much you fund.”
The Nevada State Education Association was disappointed the increase wasn’t bigger.
“It was a bit on the conservative side,” said NSEA director Ken Lange.
He said the state needs to add about $200 million to the Distributive School Account, which funds public schools. “That $200 million will just fill the hole.”
Forum chairman Michael Small and member Leo Seevers disagreed they were being conservative.
“I hate to say we’re being conservative,” said Seevers. “I like to think we’re being accurate.”
The forum added more than $100 million to projected revenues when it met in December. The May meeting is normally a much smaller adjustment to true up projections with the most recent monthly collections. Pierce and Small said the increase approved Monday is a healthy increase.
“I don’t like to think of it as conservative or liberal,” said Small. “We’ve projected some pretty strong growth.”
The changes approved Monday added more than $80 million to projected sales tax revenues over the next two years and about $50 million to the gaming tax.
Gaming Control Board analyst Frank Streshley told the forum eight of nine months this fiscal year have been monthly records for gaming win, and those tax collections should continue to improve with the opening of Steve Wynn’s new resort on the Las Vegas Strip.
In fact, the gaming entertainment tax, business tax and real estate transfer tax projections were also increased. Only the insurance premium tax and cigarette tax were flat or down from December’s projections.
And a long list of smaller revenue sources also showed some increases – about $9 million, which brings that list to a total of $320.8 million for the biennium.
In addition, the forum added $85.5 million to the revenues expected this fiscal year. That funding, however, can’t be put into ongoing program costs, but must be treated as “one-shot” money for special projects such as construction.
n Contact reporter Geoff Dornan at email@example.com or 687-8750.
Gaming tax revenues – $1.6 billion
Gaming entertainment tax – $276.9 million
Sales tax revenues – $1.95 billion
Real estate transfer tax – $281.7 million
Insurance premium tax – $292.9 million
Cigarette tax – $75.6 million
Modified business tax – $468.8 million
Total projected revenues
Fiscal year Increase over December
2005 – $2.72 billion $85.57 million
2006 – $2.89 billion $95.14 million
2007 – $3.05 billion $84.97 million