Last year, Las Vegas drew 39,727,022 visitors, surpassing 2007’s high-water mark of 39,196,761. Gambling revenue on the Strip was $6,207,229,000, down from 2007’s $6,827,613,000. (It is important to remember that the leveraged buyouts and multi-billion-dollar construction projects that were in full swing in ’07 were based on the assumption that gaming revenues would have grown significantly by this point.) The average 2012 daily room rate, $108.08, was also down from 2007, when it hit $132.09/night, despite the higher visitor volume. That’s because, during the Great Recession, Las Vegas’ inventory of hotel rooms ballooned from a not-inconsiderable 132,947 to 150,481. That’s good for the consumer, though, because it exerts downward pressure on room rates. (Click the link to sign up for free to our weekly LVAGold newsletter, detailing the current top deals on hotel rooms, show tickets, and more.)
What’s not good for the State of Nevada is the reluctance of gamblers to spend as much as they once did. As Businessweek reported, "Taxes paid by casinos on their winnings account for about a quarter of all state general fund revenues." Under Gov. Bob List (R), the state’s general fund was pegged to casino and sales-tax revenues. Las Vegas Review-Journal political columnist Steve Sebelius later described it as a formula "designed to fail in bad times." As recent governors have had to slash and dice the state budget, year after year, the truth of Sebelius’ characterization has become quantifiable.
