Toronto city council approved its $13.5 billion operating budget and its $43.4 billion 10-year capital budget at a special meeting on Wednesday.

On Wednesday morning, council approved new property tax rates for 2020. Residential property taxes will rise 4.24 per cent in 2020, council decided.

For the average homeowner, the property tax increases mean roughly an additional $130 this year.

The 4.24 per cent includes:

A two per cent inflationary increase in average residential property taxes to support city operating budget expenses.

A 1.5 per cent increase in the city building fund to support transit and housing capital projects.

A .74 per cent increase in average residential property taxes that results from a tax shift from industrial and commercial properties to residential properties in line with city policies and provincial law.

Mayor calls budget 'good, responsible, realistic'

"This is a good, responsible, realistic, forward-looking budget for a very fast growing and very successful city," Mayor John Tory told reporters on Wednesday at a news conference.

"The budget is balanced in the sense that the revenues meet the expenditures as is required by law. But I believe it is also balanced in the context of balancing all the competing interests and different interests that the city has."

Tory acknowledged that many Toronto residents are facing financial challenges, but said the operating budget includes $79.4 million in new investments in "key" areas, preserves existing services and finds efficiencies in city government.

These key areas include $27.8 million for safety and security, $15.3 million for poverty reduction, $9.5 million for transit and $5.9 million for climate change.

A city budget graphic shows how property taxes are spent in Toronto. (City of Toronto)

"I understand that people, in many cases, are finding life stressful on a financial basis today, but together with a modest tax increase, we're also doing things to try to make their lives more affordable," Tory said.

"It will cost a lot more in the future if we don't invest in transit and affordable housing and community safety now."

Budget means more police, TTC staff, paramedics, librarians

The mayor says the operating budget means the city will be able to hire 300 police officers, 121 TTC operators, 62 paramedics and 21 librarians to staff youth hubs.

"These are people who will be visible to the taxpayers, to the people of Toronto every single day, on the street, delivering services to people, driving buses, saving lives, keeping us safe," Tory said.

Tory also acknowledged that the budget relies upon $77 million from the federal government for refugees and he said he expects Ottawa to "step up again." City officials have said that refugees are under federal jurisdiction.

"I have been talking to them about that. I've had lots of positive feedback. No cheques yet, but I am confident that they will understand that the responsibility is not a one-off deal that happened last year, that we'll get that funding again," he said.

As for the capital budget, the city said in a news release on Wednesday: "The plan meets the city's most critical needs for transportation, the environment, real estate and emergency service facilities. The plan invests a total of $13.2 billion in transit, nearly doubling the investment in state-of-good-repair this year."

Coun. Joe Cressy says: 'We have said since day one as a city, that the province needs to reverse these cuts, but we're not going to stand by and let our residents down.' (Paul Borkwood/ CBC News)

Province must reverse municipal cuts, Cressy says

Coun. Joe Cressy, who represents Ward 10, Spadina-Fort York, said the city needs to increase property taxes to make up lost revenue after the Doug Ford government cut $7 million from municipal services last year.



"We have said since day one as a city, that the province needs to reverse these cuts, but we're not going to stand by and let our residents down."

In the release, the city added that it considered the needs of its most vulnerable residents.

"As part of the 2020 budget process, programs and agencies considered the impact on all Torontonians, analyzing the effect of budget changes on equity-seeking groups, such as residents with low incomes," the release reads.

"The budget includes more than $25 million in poverty reduction and anti-violence community investments to make city services and programs more accessible."

The overall average budgetary increase is 1.43 per cent, the city said.