WATERLOO — In his first state of the city address Wednesday morning at RIM Park, Waterloo Mayor Dave Jaworsky poked fun at himself for being elected mayor, floated city projects and gave his personal pledge to get uptown businesses through light rail construction.

He also warned of the possibility of tax increases.

"I fully expect to find ourselves faced with some tough questions," Jaworsky said, referring to the upcoming strategic plan and budget process.

"What is our quality of life worth? What do we consider value for dollar? Do taxes match the level of service and infrastructure needs that our community expects? If we truly love our city and we truly want to become a location of choice for businesses, families, professionals and students, we may need to adjust our approach," he said.

Waterloo city council signalled its intention in March to potentially abandon a system that has helped limit tax increases up to this point.

Waterloo uses the Municipal Price Index to help determine tax increases.

It helps determine the annual tax hike by considering the costs of several city expenses, including salaries and benefits, electricity, water and sewer, natural gas and the consumer and construction price indices.

During the 2015 budget process, council agreed to investigate using the Consumer Price Index instead of the Municipal Price Index. A staff report is expected in early summer.

Jaworsky was able to announce at least one new project Wednesday that won't put a further strain on citizens' budgets.

United Way Kitchener-Waterloo has pledged $10,000 per year for three years toward the city's neighbourhood matching fund. It provides grants for neighbourhood projects.

In a 30-minute speech that covered almost every ongoing city issue, Jaworsky also took time to talk about his 2014 election pledge to support economic development. He paid tribute to his former employer and took a dig at himself.

"About 90 per cent of former BlackBerry employees have found new jobs, gone on to further their education, start their own business, become mayor," Jaworsky joked.

He added, "I'm happy that it remains a leading player in global technology."

Construction of the Region of Waterloo's light rail transit project is likely to be a key challenge for businesses this year, Jaworsky said, a challenge he pledged to help with.

"Finding solutions to the challenges of LRT construction will be a top priority for me," he said.

To applause, Jaworsky urged the dignitaries, community members and business people in attendance to support Cambridge, Kitchener and Waterloo businesses affected by the project.

He said uptown Waterloo is well-positioned to get through construction because of ample parking and signed detour routes.

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"LRT construction is and will continue to be a challenge for us," he said. "Construction began in September last year and we are experiencing local road closures and perceived difficulty accessing our favourite shops."

The mayor's annual state of the city address is a fundraiser for KidsAbility.