Current Economic Discussion/Issues
The LVCVA’s financial results for the first quarter of FY 2012 (July through September) reflect a continuing trend of stability and moderate recovery. Key results at the end of the quarter as compared to the same period last year:
Room tax revenue is up 17.8%
Visitor volume is up 4.7%
Average daily rate is up 13.2%
Average Number of Rooms Occupied Daily is up 5.1%
Room tax was conservatively budgeted to remain flat in FY 2011; however, FY 2011 room tax revenues exceeded FY 2010 by nearly 14%. Room tax revenue has continued that improving trend during the first quarter of FY 2012. As of September 2011, room tax has exceeded expectations each month for the past eighteen consecutive months. Although we are delighted at the increases, revenues have not yet returned to peak year levels and the threat of another recessionary ‘dip’ is a constant fiscal moderator.
The LVCVA developed and implemented a nine-point plan to incrementally restore funding as revenue streams grow and prove sustainable. Priority funding will be allocated to advertising the destination, rebuilding fund balance and reserves, and reducing the impact on personnel and restoring operating budgets.
The environment for the Las Vegas region-wide economy continues to be bumpy, with mixed results across the quarter and across key indicators. The Southern Nevada Index of Leading Economic Indicators (SNILEI) reported increases in the overall index for July and August, while September slipped by 0.68. The SNILEI measures changes in multiple activities, including residential and commercial building permits, taxable sales, air passengers emplaned and deplaned, gross gaming revenues, gasoline sales, unemployment, visitor volume and convention attendance.
Management continues to monitor our financial position daily and is encouraged by each positive signal.
-
Financial Status October 2011