During his first public speech since council stripped him of many of his budget powers, Rob Ford smiled, laughed and told jokes at his own expense.

“We’ve reduced council and the mayor’s budget by $6.4 million over four years,” he said, adding, “even more in the last three days” — a reference to Monday, when council voted to shift the majority of his responsibilities to Deputy Mayor Norm Kelly.

But the city’s embattled mayor drew a hard line when it came to the budget and tax increases.

“I have said I want a one-and-three-quarter per cent tax increase — that’s including a reduction in the land transfer tax; that’s including a half a per cent for the subways,” Ford told a cheering crowd at an economic development event at Casa Loma, before acknowledging, “I don’t believe that’s going to happen.”

In light of new expenditures and the commitment to building the Scarborough subway, budget chief Frank Di Giorgio said earlier Thursday “it will be very difficult” to keep the property tax increase to 1.75 per cent.

“The persistent message of, ‘You have to find saving’ — there comes a time when you have to say, well, there are no more savings to be had.”

But Ford made it clear he has no plans to stop tackling the “gravy train,” even in his diminished role.

“This is not the way I ran the government,” he said. “I know we can achieve a one-and-three-quarter per cent tax increase to keep this city as great as it ever has been.”

When city staff make their recommendations to the budget committee on Monday, Di Giorgio said he anticipates the proposed property tax rate will be closer to 2 per cent.

Although the mayor was in campaign mode and pledging to keep taxes down Thursday night, when Di Giorgio broke the news to Ford Wednesday he said the mayor’s reaction, “was not good.”

“To be brutally honest, I think his feeling is the moment he was pushed aside — the gravy train got back in action,” he said. “I know he will dig in his heels regardless of what happens. He’s not going to give up easily.”

But Ford’s influential seat at the head of the executive committee falls to Kelly now, as will future speaking engagements like the one at Casa Loma, the deputy mayor said.

“In a go-forward perspective, the expectation may be that invitations like that would go to my office,” Kelly said, noting this invitation could have come before the past week’s events.

The experienced politician — who has said determining the property tax increase is one of his top priorities — again assumed a diplomatic tone on Thursday, when asked about working with Ford on the budget.

“The Romans built the most successful empire, one of the biggest empires in history, under the leadership of two consuls occupying the same seat,” he said. “If they can make it work, then we should be able to do it.”

Di Giorgio, who met with both Ford and Kelly on Thursday, described himself as a “conciliator” between the pair.

“I think they both have to be involved, they both have to be aware of what’s going on,” Di Giorgio said.

Still, Ford seemed less than conciliatory or willing to adjust his vision for the city during his speech and he brushed aside any suggestion his scandal might be causing the city economic harm.

“My administration’s approach to the way to do business has resulted in balanced, sustainable budgets, reduced debt, enhanced services and significantly higher investments in our vital infrastructure needs,” Ford claimed. “Friends, they’re the facts.”

Although there was still a crowd, Councillor Michael Thompson, chair of the city’s economic development committee, said a number of people declined to attend the event because of Ford’s presence.

“I don’t think we can afford to gloss it over,” he said. “We need to send the message that the city’s working.”

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But as he introduced Ford, Thompson made it clear he doesn’t think recent events will have a “long-term negative effect” on the city’s economy.

“We will not let the personal failings of one or two people … drag our city down,” Thompson told the crowd, without mentioning Ford’s name, although Ford thanked him for his “kind words” to much laughter.