North Las Vegas braces for $64M plunge in revenues from outbreak

North Las Vegas is anticipating a $64 million reduction in revenues through the end of the next fiscal year, according to the city’s chief financial officer.

That figure places North Las Vegas back in the familiar position of a fiscal bind. Through the end of fiscal year 2022, the city anticipates an additional $43 million of revenue loss.

Chief Financial Officer Darren Adair said the revenue shortfall means the city will have to tighten its belt, but it might be better prepared than others for that shift because it already operates with a lean workforce. Instead of turning its attention to additional spending like it had planned, the city will stay the course of frugality.

“The city of North Las Vegas has been watching pennies for the last six years,” Adair said.

The final fiscal year 2021 budget, scheduled to go in front of the City Council next month, is not likely to see significant cuts, Adair said. However, the hiring and additional services that were planned will no longer happen, he said.

Adair said he anticipates changes to the upcoming budget can cover projected shortfalls for the next fiscal year, but the following fiscal year would require cuts.

He spoke plainly about what cuts could mean for the city.

“I think North Las Vegas citizens, they are going to see some some reductions in services, and there is going to be some tightening on the paychecks of employees,” he said. Adair also said employees could instead see a reduction in benefits. But the cuts North Las Vegas will face aren’t expected to be as dramatic as other municipalities in the area, Adair said.

Labor is one of the city’s biggest expenses, Mayor John Lee said Thursday.

Lee said he does not want employee wages to be cut, but the economic challenge ahead may be an opportunity to save in labor costs with retirements.

“If we go in there and we start slashing all these wages, we’re going to lose a lot of good people,” Lee said. “And I want to keep our employees happy and hard-working like they are.”

Since the COVID-19 outbreak brought Nevada’s economy to its knees, North Las Vegas has furloughed 233 part-time employees, according to a city spokesman.

A bailout from the federal government may be a piece to the financial comeback puzzle for North Las Vegas, but Adair said the city is not building a plan that depends on it.

City Manager Ryann Juden said officials are working with bargaining groups to see what can be done to prevent a reduction in services to residents. Earlier this month, the City Council denied a trio of labor contracts that would have given employees represented by Teamsters Local 14 retroactive raises, as well as additional raises in the coming fiscal year, which begins July 1.

North Las Vegas has experience clawing its way back from the depths of the recession, moving from the brink of state takeover to fiscal solvency.

“We’ve done it before,” Juden said. “We know where the foot holes are and how you climb out of it, so being thrown back down the hole again makes it a little bit easier to come back out. It’s not new terrain for us.”

During its economic comeback from the recession, North Las Vegas eliminated services and about 1,000 jobs. Adair, the chief financial officer, said he thought when the city made its way back into the black, everyone would be able to relax.

“Guess we never got out of the woods,” Adair said.

Contact Blake Apgar at bapgar@reviewjournal.com or 702-387-5298. Follow @blakeapgar on Twitter.