For good reason, 2011 will be a year that many involved in Hall County government will want to forget.

Facing an $11.5 million budget shortfall, the Hall County Board of Commissioners voted to slash costs by cutting county jobs, services and employee benefits to make up the difference.

Still, Hall County Administrator Randy Knighton said there is something worth remembering about 2011.

"I think all of us gained experience from last year's budget process," Knighton said. "There were very valuable lessons we learned."

Moving into 2012, city and county officials are once again expecting budgets to be tight and tax revenues to be on the decline.

Still, there is optimism that those lessons, cuts in costs that have already been made and an improving economy will prevent local governments from facing budget crises.

Perhaps the biggest obstacle is the continued decline in property values. Elected officials in Hall have moved to pass budgets without raising property taxes to make up that difference.

"A recession is not the proper time to increase the burden on the taxpayers," Hall County Commissioner Craig Lutz said.

In 2011, there was a 6 percent decrease in taxable value for Hall County, according to Hall County Chief Tax Appraiser Steve Watson. Watson estimates that in 2012 that number could be between 6 and 9 percent.

That phenomenon is happening not just in Hall County but throughout the region and most of the nation.

While property taxes are not the sole source of income for local governments, it is a significant portion.

Property taxes are projected to make up 40 percent of Hall County's general fund in 2012.

In response, officials say they have adjusted their budgets this year in expectation of further decline.

Oakwood's 2012 budget, passed in November, has been built on an expectation that the city will collect $41,000 less in property taxes due to the lowered values, according to City Manager Stan Brown.

Knighton said the county has also built in savings.

So far for this fiscal year, which began July 1, Knighton said all county departments are running "under budget."

Those cuts have come at a cost. The fiscal 2012 budget cut 79 jobs and contributions to employee retirements. It also cut funding for four parks and closed two tag offices.

The budget process was not nearly as contested in the city of Gainesville.

When Gainesville City Council members learned a budget surplus was higher than previously projected in November, they approved a one-time bonus for city employees.

Still, City Manager Kip Padgett does not expect 2012 to be a breeze for Gainesville's government.

He said more adjustments will need to be made during its budget process next summer.

Looking ahead in the county, commissioners are anticipating another budget gap, but Lutz expects that will come "with a softer landing."

Lutz and other commissioners have expressed a commitment to "making the (county) employees whole again," presumably through a return in lost benefits, but it's unclear how that will happen.

So far, Knighton has refused to speculate on whether more county jobs could be lost.

"I would be hesitant at this point to talk about or discuss any outcomes from this upcoming budget," he said. "It's too soon to speculate."

However, some county commissioners are already looking for more ways to cut the budget.

"Our goal is to make the government as small as can be and still serve the people as good as we can," Lutz told The Times.

Commissioner Ashley Bell said the key to spending less, at least in part, is through competitive bidding processes for the county's projects. Bell said the county isn't going far enough to ensure every contract gets a competitive bid.

He expects that process could prevent cuts to more county jobs and benefits.

"If we don't abandon our free market principles," he said, "we can take some pressure of off the (county) employees."

Lutz is proposing continued exploration in the privatization of services, particularly in the county's waste services.

However the budget turns out for the county, Knighton said the county will be transparent in the process.

"We want to make sure the information we have is stated to the public in a fashion that will make it more understandable," he said. "We want to make sure citizens are engaged early."