Tourism: Things Could Be Worse -- You Could Be Nevada

(MoneyWatch)  I saw something today that made me realize how bad things are in Nevada: the cash-strapped Nevada Commission on Tourism canceled its annual meeting next week -- to save money.

From the Associated Press:

"It's a huge deal and it was an extremely difficult decision to make," Lt. Gov. Brian Krolicki said Wednesday. "This conference was going to lose money and essentially by canceling, we are losing less money than if we went forward."

The financial losses are no joke, the budget shortfall for the state is about $340 million and Gov. Jim Gibbons is contemplating folding the state's tourism agency (and budget) into another department.

The body count: McCarran Airport, Las Vegas' airport near its famous Las Vegas Strip, dropped 500,000 visitors in October, year-over-year. The state's taxation department, which tracks restaurant and bar tabs, said those sales also dropped 19.6 percent in September, year-over-year, the latest statistics on record. And, in case you didn't think it could get worse, the state's unemployment rate rose to 7.6 percent, the highest since 1985, and is expected to rise to 8.6 percent next year.

The economy: An economic forum on Monday projecting $5.7 billion in revenue for the state wasn't good news. Instead, it revealed the state didn't have enough money -- $1.2 billion -- to keep going as-is. Nevada already tapped into reserves and cut budgets to make up for financial losses in the last two years, so news that the state will continue to hemorrhage cash seemed bleak:

In developing the estimates, forum members heard a report from . . . an economic consulting firm, that Nevada's tourism-dependent economy isn't likely to recover before 2010.

I'm not sure if there was a collective gasp, but if I were in the tourism industry and read AP's account, I think I would have run screaming from the room. (One news agency said officials were reportedly "stunned.")
Again, Nevada is the eye of the storm in this battered tourism economy, and it seems Nevada's only option is to continue to ride it out.