Ottawa Mayor Jim Watson is calling for a 2.45 per cent property tax increase for urban areas in this year's draft budget. In rural areas, the tax increase will be 2.4 per cent.

The proposed tax increase falls slightly below Watson's campaign promise to keep property taxes at an increase of no more than 2.5 per cent each year. Last year's property tax increase was 3.9 per cent.

The proposed tax hike translates to an additional $75 for the average urban homeowner, including policing. Water rates are also going up 4.5 per cent, which means the average water bill in Ottawa will be $540.

Watson says keeping property taxes low will mean some belt-tightening at Ottawa City Hall. He's frozen his own salary and cut the mayor's office budget by $80,000.

He told city council he's not asking them to follow his lead with such a deep cut, but the budget doesn't provide for any increases to councillors' budgets or salaries.

The budget also includes $44 million in cuts at Ottawa City Hall. However, those cuts haven't been publicly identified.

"There is no doubt in my mind there are cuts in this budget. Just because they weren't spoken about doesn't mean they won't be of interest to people and that's our job now," Coun. Maria McRae told CTV Ottawa on Wednesday.

Transit cuts

Transit fares would also go up a maximum of 2.5 per cent, effective this July. That would increase the cost of an adult monthly bus pass from $91.50 to a maximum of almost $94.

The transit commission is also looking to cut $30 million from OC Transpo operations over the next two years. The proposed cuts include $7.2 million this year and $23 million in 2012.

"We have routes that run in close proximity to each other and as the review indicated there is the ability to rationalize that network," said city manager Kent Kirkpatrick.

Rather than discussing possible cuts to transit, the mayor said the budget focuses on improving bus service.

"A better service does not mean more milk runs through every neighborhood stopping every 200 meters and crowding through the downtown bottleneck. It means express service that runs on time, reliably, even when there is a storm or a traffic snarl," Watson told city council on Wednesday.

He said the budget also calls for a four-year commitment to expand park and ride facilities in Orleans, Barrhaven and Kanata, and to make Transitway improvements.

Watson added he wants to decrease the cost of running transit by hiring new bus drivers to clamp down on overtime.

The city is also looking at ways to transport the same number of people in bigger vehicles at a lower cost. Possible solutions include expanding the capacity of the O-Train or buying more double-decker buses.

Seniors who use transit would also get more free trips. Currently, transit is free for seniors on Wednesdays. The draft budget would expand that service, giving seniors free transit on Mondays and Fridays as well, anytime after noon. That service would begin in April.

No new hires for police

Meanwhile, Ottawa police say clamping down on spending will have an affect on hiring new officers over the next four years.

Ottawa's police chief says trimming $6.1 million from their initial budget request will halt the hiring of 23 new officers this year alone.

"Some of our priorities of the last few years, we won't be able to increase those services to the level we had hoped and others as a result of dropping off of our strategic growth initiative," said Vern White.

However, he adds that even with a slim budget he's confident the city will remain safe for its citizens.

Sewers and rec fees

As for spending, Watson says he wants to dedicate $28 million to addressing sewer problems in Kanata; and he'll take $14 million from provincial social service funding and put that towards homelessness.

Recreation fees will also be frozen and a new sports complex is slated to be built in Barrhaven, which would include a twin-pad arena, a 25-metre swimming pool and a community centre that includes a gymnasium. The facility would also have an outdoor play area and sports field.

Renting arenas and gyms

The city also wants to make it easier to rent recreation facilities. New technology, pegged at a cost of $15 million, is expected to save money and offer better service to residents who want to access city services.

"Today, booking an arena to play hockey with friends involves calls to the city and waiting to be called back to find out what's available and when. An application is then faxed to the resident, filled out and signed and faxed back. I think we can do better," Watson said.

Service changes include allowing residents to book and pay for renting recreation facilities online, as well as offering a virtual tour of city facilities on the city's website,

The draft budget is also cutting discretionary spending for conferences, business travel and luncheons.

The mayor also wants to reduce the city's reliance on outside legal services and consultants.

Residents can provide feedback on the draft budget at a town hall meeting on spending control which will be held March 1 at 7 p.m. at Ottawa City Hall. Public consultations will also be held across the city in February and March.

With a report from CTV Ottawa's John Hua