Yesterday, it was determined that Nevada is expected to see a $350 million decline in revenue after the state’s Economic Forum announced a $191 million drop in revenue for the general budget on top of an anticipated drop of $160 million for the State Education Fund, due in large part to Trump’s reckless tariff policies. This is the first time since the Great Recession that projected revenue has decreased mid-Legislative Session. Economists also noted that because of rising costs under the Trump administration, consumers are pulling back on spending. This is apparently the desired outcome of Trump’s policies that Joe Lombardo has hoped for, having told reporters that Nevadans need to “feel a little pain” from Trump’s tariffs.
As Trump’s reckless tariffs pummel the economy and raise costs for working families and businesses, reports reveal that since Trump started his trade wars, travel to Las Vegas has declined by hundreds of thousands of visitors each month as foreign visitors opt not to come to the United States. In March, travel to Las Vegas was down 7.8% and hotel occupancy was down 2.4%, when compared to this time last year. Gaming revenue has also taken a hit, down almost 14% in February.
Nevada Independent: Fearing slowdown, Economic Forum predicts $191M less for forthcoming Nevada budget
Key points:
- Nevada lawmakers will have about $191 million less to work with than originally anticipated when creating the state’s upcoming two-year budget, a 1.6 percent reduction likely to set off a string of cuts and the death of many bills with a price tag.
- A revenue forecast for the State Education Fund, obtained by The Nevada Independent, indicates a nearly $160 million decrease from previous projections — resulting in a total decrease of approximately $350 million.
- The Economic Forum — a panel of five private-sector economists empowered to make the tax revenue projections that the governor and lawmakers must use in building their budget — estimated on Thursday that the state will bring in about $12.2 billion in revenue during the next two budget years. It marked a downturn from its December projection of $12.4 billion, a figure that Gov. Joe Lombardo used to craft his recommended budget (which initially came in hundreds of millions of dollars over that amount).
- It’s the first time since 2009 that projected revenue has decreased mid-session — forum members make their initial projections in December and an updated set at the start of May. Now, with just a month left before the Legislature adjourns, lawmakers will embark on a mad dash to ensure the state’s budget is not in the red.
- However, a consensus forecast prepared by the Legislative Counsel Bureau’s fiscal division and the Governor’s Finance Office, and provided by Assembly Speaker Steve Yeager (D-Las Vegas) shows a nearly $160 million reduction in projected money toward the State Education Fund — leading to a total decrease of about $350 million.
- Lombardo, a Republican, also has five priority bills — three of which have not been formally introduced yet — that carry a significant price tag. Initial estimates showed that the proposals would cost the state upward of $500 million across the next two years, but those numbers were already factored into his recommended budget.
- In a statement after the projection, Lombardo spokeswoman Elizabeth Ray called it “a manageable” shortfall that the state “will be able to mitigate.” She added that Nevada will be able to weather any budget shortfalls that may arise after the session ends with the state’s emergency fund.
- “Nevadans can rest assured that the State is well-prepared to navigate moments of fiscal uncertainty, especially with the record amount of money in the Rainy Day Fund under Governor Lombardo’s leadership,” she said in the statement.
- Senate Majority Leader Nicole Cannizzaro (D-Las Vegas) told reporters Thursday that the priority for the rest of the session will be keeping existing programs and services in place. She raised concerns the Legislature will have to later convene for a special session to cut the budget, and she blamed the Trump administration for the shortfall.
- “When you hear rhetoric and chaos and uncertainty, that is going to have an effect on people’s willingness to come here,” she said. “The more that people are not willing to come to Nevada … the less we’re going to be able to do here in state government to provide those services.”
- In an interview with The Nevada Independent, Attorney General Aaron Ford — who is running for governor as a Democrat in 2026 — also laid the blame on the Trump administration for the projected drop in tax revenue, and he noted that the state projections come as Congress is discussing federal cuts that could further affect Nevada’s budget, nearly a third of which relies on federal funding.
- “I’m angry because while Trump is handing out tax breaks to billionaires, it’s actually our teachers, firefighters, small business owners, our neighbors, our friends, our seniors,” Ford said. “They’re the ones who are going to be paying the price.”
- The revised estimates come amid warning signs for the state’s economy. At Thursday’s roughly six-hour hearing, economists said they expected a potentially strained labor force amid reduced immigration, modest gains in unemployment and decreased tourism because of the Trump administration’s trade policies, particularly from Canada, which makes up about 30 percent of the state’s international travel.
- “We’ve seen some pretty dire numbers about vacation planning by Canadians to the United States,” said Emily Mandel, a senior economist with Moody’s Analytics. “[This] would have a noticeable, measurable impact on Nevada’s tourism economy.”
- The biggest driver of the lower revenue projections was the state’s sales and use tax. The forum approved projections that are $102 million (2.7 percent) less than what it expected in December, driven by changes in the general economic outlook and consumer spending behaviors. The estimate was among the more conservative ones forum members could have selected.
Las Vegas Sun: Nevada faces cash crunch after budget projection drops by $200M
Key points:
- The Nevada Economic Forum signed off on a two-year general fund projection $191 million lower than it was during the last forum meeting today, blowing another hole in what’s already been a rough budget process in Carson City.
- The economic forum’s forecasted sales tax revenue makes up much of the difference between the new outlook and the one from December: around a $50 million drop for both financial year 2026 and 2027.
- The percentage of American households planning a vacation is down from 2024 highs and consumer confidence has spiraled for months. In March, visitation to Las Vegas was down 8% compared to last year, according to the Las Vegas Convention and Visitors Authority.
- Rep. Dina Titus, D-Las Vegas, warned in a statement that the $191 million hole combined with incoming federal cuts could send the state into a budget crisis.
- “Nevada is often the first state to suffer from economic downturns because of our reliance on tourism,” Titus wrote. “We must oppose federal policies that will mean job losses and cuts to services when Nevadans need them most. The future of our state is at stake.”
- During the seven-hour meeting, the Governor’s Financial Office said that it expects unemployment to increase during the next financial year to 6.55% from 5.69% with a slight drop in FY 2027.
- At the same time, visitor volume is expected to drop by 4.4% in FY 2026 before, again, slightly recovering the next year.
- “It is more important than ever that Nevadans call on the Trump administration to reverse course on tariffs and oppose the draconian budget cuts by DOGE and the Republican Congress,” Titus wrote.
- Cannizzaro said federal Medicaid cuts are “absolutely” a question mark.
- “If those federal dollars are also not in our budget, we have to make a determination whether or not those programs are then cut or if we have state funds to backfill,” she said. “With lower projections and revenues, the idea that we would have the additional state dollars to fund those is exceedingly rare.”
- “The more that we see chaos in Washington, the more that there is a lack of consumer confidence, the more that people are willing to spend less, the more impact that is going to have on Nevada,” Cannizzaro said. “It should be concerning for every Nevadan.”
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