MARSHALL — The Marshall City Council will be looking at a proposed levy increase of 8.1% next year, city staff said Tuesday night.

The proposed increase is down a little from the 9.04% preliminary levy the city set back in September.

The council held its annual “Truth In Taxation” meeting Tuesday. City staff went over the proposed budget and levy for 2023.

“Staff and the city have been working on the budget since last summer,” said Marshall Mayor Bob Byrnes.

Marshall City Administrator Sharon Hanson said the city started out looking at a proposed levy increase of 13.2% in August. That proposal decreased to 9.04% in September, and now a proposed increase of 8.1% will be brought before the city council on Dec. 13.

Hanson said factors like increases in health insurance costs and inflation all affected the city’s proposed budget and levy. The city has also had smaller levy increases over the past three years, she said.

City staff said factors like rising property values had an impact on individual taxpayers. Marshall City Assessor David Parsons said the city tax burden has also shifted, with residential properties taking on more of the burden than commercial and industrial properties. Some large commercial properties in Marshall would see their overall taxes go down in 2023, city staff said.

Parsons said the rise in residential property values could also mean that individual taxpayers see less impact from Minnesota’s homestead market value exclusion. The exclusion helps decrease net property taxes, but the amount of the exclusion is reduced as property values increase. The exclusion phases out for homesteads valued at $413,800 or more.

The formula used to calculate the homestead market value exclusion hasn’t been changed by the state in many years, Parsons said.

A few members of the public attended the meeting and voiced concerns that had to do with property valuations and the homestead market value exclusion. City staff said the property value changes and the homestead market value exclusion formula couldn’t really be addressed by the city, but they encouraged homeowners to contact their legislators.

City staff also encouraged taxpayers to make sure they applied for Minnesota’s homestead credit refund and renter’s property tax refund.