Hall County has tallied its preliminary local tax digest and the results are a letdown to the Hall County school system, which is already struggling to operate with limited resources.

The total digest, which is the sum of all taxable property in the county, has decreased by about $138 million, or 2.3 percent since May 2009.

"Unfortunately what it means is even deeper cuts than what we were anticipating," Hall County Schools Superintendent Will Schofield said.

Hall County Property Tax Manager Scott Martin said a deflation of property values and an increase in the number of people receiving school tax exemptions equates to a 3.8 percent decrease for the school system.

Motor vehicle taxes also were down significantly, along with commercial and industrial taxes.

Martin said he does not expect the preliminary tax digest figures to change much, but local governments need an estimated figure to set their budgets by the end of June.

Hall County Administrator Charley Nix did not return phone calls from The Times seeking comment on cuts the county may have to make.

Higher school tax exemptions over the last year hit the schools hard. Hall County residents older than 70 and Gainesville residents older than 72 can receive a full school tax exemption. Some other residents receive partial school tax exemptions.

More people applied for the full exemption this year, which greatly lowered revenue for Hall County schools.

"That’s the one that hits us the hardest," Schofield said.

County schools were estimating the digest to decrease by about $88 million, or 1.5 percent.

Schofield said the school board will have to figure out how to handle about $2 million less in the budget this fiscal year, which begins in July.

"That goes along with $11 (million) to $14 million of lost state funding," Schofield said.

There isn’t any fat left to cut out of the schools budget.

"The money is in people," Schofield said. "It’ll be fewer people, people making less money or fewer days of school. That’s really about all we have left."

He said raising taxes likely won’t be an option.

"Everything is a possibility, but the possibility of raising taxes in this economy when so many are hurting is way down on the list," Schofield said.

Despite the tough times, Schofield said the school system has remained positive.

"We accept that challenge and we’ll just turn it around and say how do we get even more efficient and what are some ways of delivering education to children in the year 2010 that we haven’t thought of before," Schofield said.