State Budget Overview

RAN Staff Report

The Nevada state budget is the financial plan for the state government, outlining the expected expenditures and revenues for a fiscal year. For the 2021 fiscal year, the Nevada state budget is $8.8 billion. This is an increase from the previous year’s budget of $8.1 billion. When the Nevada Economic Forum met in early December, they projected $11.4 billion for fiscal years 2024 and 2025, a substantial increase over the previous budget. This was attributed to Nevada’s economic recovery, especially in gaming. The Las Vegas Review-Journal reported that monthly gaming win revenues have exceeded $1 billion, taxed at 6.75 percent, for 20 consecutive months as of October 2022, according to Michael Lawton, senior economic analyst for the Nevada Gaming Control Board. As we look to the upcoming budget, education is funded first and is the largest portion of the Nevada state budget, comprising about 38% of the total budget. This includes funding for K-12 schools, higher education institutions, and programs such as early childhood education and special education. Health and human services is the second largest area of expenditure, accounting for approximately 28% of the budget. This includes funding for programs such as Medicaid, mental health services, and assistance for low-income individuals and families. The state’s transportation system is also a significant part of the budget, with approximately 8% of the funds being allocated to maintaining and improving roads, highways, and other infrastructure. Other areas of the budget include public safety and justice (7%), natural resources and environment (3%), and economic development (2%). Revenue for the Nevada state budget comes from a variety of sources, including taxes, fees, and grants from the federal government. The state’s primary source of revenue is sales tax, which accounts for about 44% of total revenue. Other significant sources of revenue include gaming taxes (18%), property taxes (14%), and mining taxes (6%). The Nevada state budget is prepared by the Governor’s Office of Budget and Planning based on input from state agencies and departments, as well as data on the state’s economic and financial conditions, and is then reviewed and debated by the Nevada legislature. Throughout the budget process, the Legislature and the Governor’s Office of Budget and Planning and other state agencies work to ensure that the budget is balanced, meaning that revenues are expected to be equal to or greater than expenditures. Planning for the upcoming budget relies on the projects by the Nevada Economic Forum. The budget will be prepared based on the December projections, but the final budget will rely on the findings during the May 2023 meeting of the Economic Forum. All indications show the Governor and Legislature will be working with $2 billion more than planned, but the Economic Forum is undecided if these revenue projections will continue past fiscal years 2024 and 2025. n