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Gov. Steve Sisolak gets emotional during a Phase 1 reopening update news conference, Friday, May 15, 2020.
Thursday, June 11, 2020 | 12:52 p.m.
A special session of the Nevada Legislature to address the state’s projected $900 million budget shortfall because of the coronavirus pandemic is expected in June, Gov. Steve Sisolak said today.
“Prior to the pandemic, the state was focusing on plans to implement a child, family and community-centered Nevada government,” Sisolak said in a statement. “And while our budget looks a lot different now than it did then, I still maintain hope that we can use this opportunity to reinvent our state under that vision and fix the historic and systemic problems that served as obstacles to real progress in the past.”
The estimated revenue shortfall for the fiscal year beginning July 1 is projected at $1.3 billion, which is a significant part of the $4.5 billion that was previously appropriated.
The release also stated that without “significant federal funding” to help with the shortfall, Nevada will not be able to avoid “severe reductions” in services, including K-12, higher education and public safety.
Sisolak also said officials are working with state agencies to reduce the workforce, which could bring about 50 layoffs. The proposal calls for one furlough day each month for state employees beginning in July and freezes on salary increases.
Sisolak announced the plan to state employees in a letter and video, saying he directed agencies to present layoff plans that kept as many people employed as possible. Initially, 450 employees were projected to be laid off, but officials have reduced the number.
“You, our state employees, are what make this state run day in and day out,” he said in the video. “You are the ones who provide critical services to Nevadans.”
Nevada, which makes much of its money through taxes on the tourism industry, was hit hard by the pandemic and related business shutdowns.
A past analysis by Jeremy Aguero, a principal with the Las Vegas-based economic analysis firm Applied Analysis, suggested Nevada’s tourism industry could lose $39 billion over the next 12 to 18 months, affecting more than 320,000 employees. The gaming industry alone sends around $2 million a day to the state in taxes and fees.
The state’s rainy day fund of around $400 million has also been raided to help pay for the pandemic’s impacts. Sisolak had previously asked for a 4% cut for the current fiscal year, and announced earlier this week that the state’s budget shortfall this year looks to be around $812 million.
The state’s Interim Finance Committee will discuss a list of proposed budget cuts from Sisolak’s office at its meeting Friday.
It’s not yet known exactly when or for how long lawmakers will meet in a special session to tackle the budget.
