Nevada revenue projections off by less than 1 percent
Nevada’s Economic Forum was told on Friday, Dec. 8, that when it gave lawmakers final revenue projections for fiscal year last May, the projection missed the mark.
But only by four-tenths of 1 percent of General Fund collections that totaled $3.95 billion.
Admittedly, those projections were made just two months before the end of the 2017 fiscal year but staff advised the five-member panel that accuracy bodes well for the projections used to build the 2018-2019 biennial budget.
Forum member Marv Leavitt, longtime local government fiscal expert, said given the nature of the economy and difficulty in predicting what will happen in the future, “it’s amazing the forecasts look as good as they do.”
“It’s amazing the forecasts look as good as they do.”
— Marv LeavittForum member
Chairman Ken Wiles referred to being just four-tenths off as “outstanding.”
The forum is a panel of fiscal experts appointed from businesses around the state to objectively project the general fund revenues the state will receive each budget cycle. Those projections must be used by lawmakers and the governor’s office to build the state budget. If they deviate by going over those projections, they must provide for the tax increase to pay for the difference.
The governor and legislature did just that in the 2015 legislative session when they created the controversial commerce tax to help fund improvements to the K-12 education system.
The two largest tax generators remain the sales tax that brought in $1.09 billion in fiscal 2017 and the gaming percentage fees that generated $730.5 million. In Addition, gaming’s Live Entertainment Tax raised $102.3 million.
The Modified Business Tax is the next largest pot of revenue, bringing in $623.6 million that year.
The commerce tax, which was expected to bring in about $120 million, actually generated $197.8 million in fiscal 2017.
Other major revenues on the list are the Insurance Premium Tax at $383.6 million and the Real Property Transfer Tax at $83.96 million.
In addition to the major revenue streams, there are about 70 other smaller revenue streams including things like the cigarette and liquor taxes. Together they raised $783.6 million.
Added together, the total comes to $3.95 billion. But that is reduced by credits against the commerce, business and gaming revenues totaling $115.6 million, bringing net General Fund revenues down to $3.88 billion. According to the forum projections, General Fund revenues should top $4 billion this fiscal year, $3.92 billion after tax credits are deducted.
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Caltrans is continuing intermittent Interstate 80 ramp closures between Kingvale and the Nevada state line for construction activities this week.