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October 24, 2014

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Nevada budget experts predict drop in revenue from cigarettes but increase in booze sales

Nevada government budget experts expect a continued decline in cigarette smoking in the next two years but a slight rise in liquor consumption.

And according to projections, there will be a drop in marriage licenses and divorces.

The experts from the legislative fiscal analyst office Thursday presented their preliminary estimates on collection of minor taxes for the next two fiscal years.

Russell Guindon, principal deputy fiscal analyst for the Legislature, said these preliminary projections will yield $986.4 million for the next biennium or $479.2 million less than the current two-year period. The drop is because some of the taxes enacted by the 2011 Legislature will expire and other revenues will be diverted from the state's general fund.

The estimates will be presented to the Economic Forum at its Nov. 9 meeting. The forum's predictions will help legislators shape the state budget.

Gov. Brian Sandoval has said he favors keeping the 2009 tax package in place.

The prediction for cigarette tax collection for next fiscal year is $78.8 million, down 2.1 percent and it drops another 1.8 percent in fiscal 2015.

The experts predict the collections on liquor will be $42.2 million next fiscal year, a gain of 2.2 percent from this year and an increase of 1.9 percent in fiscal 2015.

The newly installed Internet poker games should produce $1.3 million this fiscal year for the new licenses and then drop to $646,000 next year and rise to $750,000 in 2015.

Michael Lawton, senior research analyst for the state Gaming Control Board, told the Technology Advisory Committee that six licenses have been approved and three are expected to begin operation this fiscal year.

He said he expected two other licenses for Internet poker to be operational in 2014. He said these are conservative estimates and "the whole thing could explode if the feds open this up," referring to bills in Congress to permit the Internet gambling across state lines.

Collections from marriage license fees will decline by 1.8 percent to $384,600 next year and another 1.6 percent in the following year.

Divorce fees will drop to $183,000, a slight decline of half a percent but then rise by one-half a percent in 2015.

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