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Nevada lawmakers brace for release of revenue projections
AP

Nevada lawmakers brace for release of revenue projections

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CARSON CITY, Nev. (AP) — A five-member panel of Nevada analysts and business leaders is expected to release economic forecasts Tuesday for the upcoming two years projecting the revenue that state lawmakers will have available to fund health care, education and other state services.

Business closures and fewer tourists traveling to Las Vegas plunged Nevada into a recession in the early months in the pandemic, cutting deeply into the taxes and fees that the state uses to underwrite its budget.

As a result, state lawmakers last summer slashed Medicaid reimbursement rates and specialty health care programs plus funding for the state's worst performing schools.

In December, the Economic Forum that issues the forecasts projected a quicker-than-expected recovery amid uncertainty about vaccine distribution.

The panel said the return of tourists and consumer spending would bring the state more tax revenue than anticipated. But analysts still predicted it would take until at least 2023 for revenue to rebound to pre-pandemic levels.

The December projections allowed Democratic Governor Steve Sisolak to propose fewer budget cuts than anticipated. The projections released on Tuesday will determine whether lawmakers can restore more money to agency budgets that were cut.

Nevada’s tourism-driven economy has shown signs of life in recent months as more residents, workers and tourists have received vaccines.

Hotel occupancy rates and casino winnings have increased because of pent-up demand from prospective visitors stuck at home for more than a year and additional disposable income from federal stimulus checks, analysts have said.

But long-term, the U.S. Bureau of Labor Statistics, which tracks employment trends nationwide, expects structural changes in the economy to shrink the number for tourism-related jobs.

In a February report, bureau economists projected that less business travel and weaker demand for tourism could upend the labor market and cause certain sectors to employ significantly fewer workers in 2029 compared to 2019.

The bureau projected two scenarios for shifts in the labor market: moderate impact and strong impact.

Under the moderate impact scenario, the number of hotel clerk jobs could decrease by 11% by the end of the decade and the number of host and hostess jobs would fall 8%.

Under the strong impact scenario, the number of clerk jobs would fall 22% and the number of host and hostess jobs would drop 18% by 2029.

Industry leaders and economists in Nevada do not expect shifts in consumer demand anticipated by the bureau to undermine Nevada’s recovery in the short-term.

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Sam Metz is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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