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Elko County budget committee hears preliminary FY2026 revenue shortfall, approves base-budget reset
Summary
Preliminary projections from the Nevada Department of Taxation show lower assessed valuation, net proceeds and consolidated tax receipts for FY2026, prompting a county-wide base-budget reset and a conservative plan to use volatile revenues in arrears.
Elko County budget staff told the county Budget Committee on March 12 that the preliminary revenue projections from the Nevada Department of Taxation show assessed valuation, ad valorem net proceeds and consolidated tax receipts all projected lower for fiscal year 2026.
Susan (Finance staff) delivered the update, saying, “We have received the preliminary revenue projections for the next fiscal year from the state department of taxation. Assessed valuation for ad valorem net proceeds, as well as consolidated tax, are all projected to be lower than the current year.” She added that consolidated tax receipts “have consistently trended lower than in previous years” and that the county has not seen consolidated tax this low since the 2018–19 fiscal year.
The committee heard several explanations for the drop. Janet Dearborn (Assessor’s office staff) noted that construction cost indexes used for replacement-cost valuation have fallen for some properties, citing casinos in Wendover as an example: “The replacement cost to rebuild one of the casinos in Wendover last year was 22,000,000 and this year it's 21,000,000,” a change she attributed to the Marshall & Swift cost service.
Because of the revenue uncertainty, county staff said they are resetting departmental services-and-supplies base budgets. Amanda (Budget committee member) summarized the approach: departments’ base budgets will be set at the lower of the current-year budget or the average actual expenditures over the last three years so that requests are tied to demonstrated need rather than automatic carry-forwards. Susan said the county will present a comprehensive list of departmental services-and-supplies requests at the committee’s first April meeting after completing the reviews.
On large, volatile revenue streams, staff said the county will not rely on estimated net proceeds for current-year spending. “We stopped budgeting for net proceeds altogether,” Susan said, calling it “an uncertain, very volatile, very uncertain revenue” that is received once a year in May. Instead, the county plans to use those receipts in the next fiscal year after a year-end true-up to avoid budgeting shortfalls.
Committee members also discussed motor-fuel taxes and the newly created diesel tax. Susan said the Department of Taxation did not produce a preliminary projection for the diesel fuel tax, and the county will either budget conservatively or recognize receipts in arrears after final numbers are available.
On reserves, staff projected the general fund will finish the year with about a 10% ending fund balance at the base level; that figure will determine available beginning balances for FY2026. Committee members repeatedly cautioned that a 10% ending balance leaves limited flexibility, especially given large employer-contributed benefit cost increases ahead, and urged conservative revenue assumptions and scrutiny of vacancies.
The committee did not take a formal vote on the tentative budget during the meeting; staff said the tentative budget will be submitted at the base level and adjustments will be incorporated in the final budget later in the process.
