Las Vegas anticipates $3.1 million budget shortfall in 2017

The city of Las Vegas is projected to see a budget shortfall of $3.1 million in fiscal year 2017 after operating in the black for the past four years, according to a tentative budget unveiled to the City Council on Wednesday.

The city’s general fund is projected at $535 million for the next fiscal year, about a $23 million increase over the previous year. But the budget projected only about $15 million more in revenue, leaving the city with the deficit.

City Manager Betsy Fretwell attributed the projected deficit to two main factors: the state’s property tax cap and sales tax revenue that did not perform as initially expected.

The residential and commercial property tax cap for the next fiscal year is projected at 0.2 percent, meaning property taxes can only increase by that amount even if the assessed value increases at a higher rate.

Fretwell said after the meeting that the city will have to tap into its reserve funds, which she described as “robust” due in part to operating with surpluses for the previous four years.

At least half of the city departments have been told to cut expenses by about 2 percent, she said. This could mean administrative services might take a bit longer or certain services, such as cutting the grass at parks, might be done less often.

Still, the city plans to add over 60 jobs that are either new or are replacing positions affected by layoffs. Fretwell said these additions are needed to fill “gaps in services,” such as reopening a central valley fire station that was closed during the Great Recession.

The City Council unanimously approved for the tentative budget to be sent to the state for final approval in May.

Contact Colton Lochhead at clochhead@reviewjournal.com or 702-383-4638. Find @ColtonLochhead on Twitter.