City of London staff has drafted a proposed 2019 budget with a 2.7 per cent property tax increase, down from an increase originally projected to be 3.2 per cent for the year.

The proposed rate increase — passed by members of the city's strategic priorities and policy committee Monday — will cost an extra $74 on a home with an assessed value of $221,000.

The provincial government's decision to scrap a province-wide minimum wage increase will save the city $521,000. Further savings were found through a "confidential labour relations issue" that is saving the city $2 million.

Some added costs include extra money for Middlesex-London Paramedic Service due to increased call volume ($590,000) and added costs due to new provincial minimum standards for maintaining bike lanes ($408,000).

A big ticket item endorsed by staff is a one-time $2 million investment in the new London Children's Museum, which will move from its current location on Wharncliffe Road to 100 Kellogg Ln. The money will come from the city's Economic Development Reserve Fund. The total cost of the new museum is pegged at about $14 million.

2019 will be the final update of a multi-year budget that started in 2016, when London moved away from the more traditional annual budget process.

Anna Lisa Barbon, the city's treasurer and chief financial officer, said the multi-year budget approach has been a success.

"It gave us time to spend on budget monitoring," she said. "We were able to look at savings, look at efficiencies and do much better analysis and projections that we bring forward to council."

Staffers are recommending that a previously approved three per cent increase in water rates, at a cost to the average taxpayer of $11 a year, be readopted for 2019. Also recommended for re-adoption is a three per cent rate increase for the wastewater a treatment fee, expected to cost the average taxpayer $14 a year.

The latest budget update pegs the property tax increase at 2.7 per cent for 2019. (City of London)

The proposed budget is just the first stage of an extensive review and consultation process that will include debates at committee and council level. There will also be a public meeting at city hall before the final budget is approved in February.