FLOWERY BRANCH — Hall’s city and county officials laid the groundwork Monday for the process of dividing local option sales tax dollars.

They tabbed Danny Dunagan, Gainesville mayor, and Tom Oliver, chairman of the Hall County Board of Commissioners, to lead the effort.

Officials said they will come up with a tax-sharing proposal in two weeks, giving the rest of the group a week to review the proposal before the next meeting, set for Aug. 13 at the Hall County Courthouse Annex in Gainesville.

“We have the opportunity to work through this matter in a fashion that benefits all the citizens of Hall County,” County Administrator Randy Knighton said during a half-hour meeting at the Hall County Library System’s Spout Springs branch.

State law allows counties and their cities to levy the 1 percent sales tax for day-to-day operations, lessening their reliance on property taxes.

The law further states that counties and cities receiving the revenue must renegotiate “distribution agreements within two years of each decennial census,” according to the Association County Commissioners of Georgia website.

“As such, qualified cities and counties must begin renegotiation of their distribution agreements on or before July 1, 2012,” the website states.

“We sent a letter to the cities and copied the (state) Department of Revenue prior to July 1,” said Nikki Young, county spokeswoman. “That was considered the beginning of renegotiations.”

Now, by law, Hall and its cities have 60 days to reach an agreement.

Knighton and Gainesville City Manager Kip Padgett will select mediators in advance in case talks break down.

“I don’t think any of us, obviously, want to reach that stage,” of binding arbitration, Knighton said, adding that he believes the group needs “to move aggressively” on talks because of the looming deadline.

Future meetings, including the Aug. 13 one, will be open to the public, Young said.

Phil Sutton, the former assistant Hall County administrator, will be the lead negotiator on behalf of the cities, which are collectively negotiating through the Joint Municipal Association.

Hall County hired the Eaves Consulting Group to help with negotiations.

Currently, the money is divided based on population. That formula has given Hall County a little more than 75 percent of the monthly check from the state’s Department of Revenue.

However, city officials are looking to make each government’s property tax digest a bigger factor in determining its LOST share.

That proposal would increase shares for the cities and decrease Hall County’s share by about 9 percent, according to one estimate offered in January.