Legislative Democrats say they’ve identified a more than $300 million deficit in Gov. Joe Lombardo’s recommended two-year budget.

In the year’s first legislative budget meeting Tuesday, Democratic lawmakers said the budget  released last week went $335 million in the red without offsetting revenue, which would represent about 2.5 percent of the two-year budget. Nevada’s Constitution requires the Legislature to pass a balanced budget, where revenues must equal expenditures.

Senate Majority Leader Nicole Cannizzaro (D-Las Vegas) said they’ve identified a $300 to $400 million deficit, driven by a $1.8 billion increase in general fund operating expenses for ongoing projects and an estimated $300 million for Lombardo’s bill priorities that have not yet been accounted for.

“We and our staff have confirmed that the budget is in fact not balanced,” Cannizzaro said. “Such a deficit would quickly create ongoing fiscal difficulties for the state.” 

She said lawmakers have a responsibility to fix the budget and gave the governor a 5 p.m. Jan. 29 deadline to submit an amendment.

“I think it's safe to say that we are facing a very unprecedented situation with this budget proposal,” Cannizzaro said. “I have been here for a short bit, but cannot recall a time where the governor sent the Legislature a budget that just simply didn't add up.”

Lombardo’s administration on Friday fired the director of the Governor’s Finance Office, Amy Stephenson, according to sources. She has been replaced by Tiffany Greenameyer, the deputy director of fiscal services at the Department of Health and Human Services, the governor’s office announced minutes before Tuesday’s meeting began in a press release that did not mention Stephenson.

Greenameyer acknowledged the issues during the meeting, saying “the governor’s recommended budget, as submitted, included errors.”

Senate Minority Leader Robin Titus (R-Wellington) said Tuesday that she was “looking forward to hear solutions.”

The state’s Economic Forum — a panel of private-sector economists whose revenue projections are legally required to form the size of each two-year budget — predicted in December that the state’s general fund will generate about $6.13 billion in revenue in fiscal year 2026 and $6.4 billion in fiscal year 2027.

Lombardo’s proposed budget, however, calls for $6.37 billion in expenditures in fiscal year 2026 and $6.4 billion for fiscal year 2027.

It represents a bumpy start to this year’s budget process two weeks before the legislative session kicks off. Nevada, which has a part-time Legislature that meets every two years for 120 days, has to pass a budget encompassing two fiscal years during every session. Tuesday’s meeting served as an initial presentation on the budget to an interim group of lawmakers, though legislators go into more details once the session begins.

Lombardo has prioritized fiscal responsibility, including touting during last week’s State of the State address his decision to decline “millions of dollars in state agency requests for more funding,” in favor of more accountability and increased financial resourcefulness.

A spokesperson for Lombardo did not immediately respond to an emailed request for comment.

This is a developing story and will be updated as more information becomes available.