Toronto Mayor John Tory called for an "immediate funding commitment" from the federal government and provincial governments to help the city get out of the red zone, warning of service cuts and layoffs if they do not receive any additional money.

The council also approved the 2022 operating budget in February with a deficit of $1.4 billion, assuming it would receive additional funding from other government levels.

In a letter sent to both Ontario Premier Doug Ford and Finance Minister Chrystia Freeland on Wednesday, Tory said the deficit is now about $815 million. He emphasized that the shortfall is a "direct and only result of the impacts of COVID-19." This includes TTC losses, an increase in the number of shelters in the city, and revenue losses due to travel restrictions and a decline in personal work.

Also, Tory warned that if Ford and Freeland do not step up, significant "service cuts" may be necessary, adding: "I write today to reaffirm our request for continued assistance from the Government of Canada and the Province of Ontario to address the ongoing impacts of COVID-19 on our city's finances, so that we do not have to make major cuts to the services our residents rely on, or impose huge tax increases they cannot afford, or make cuts to our capital budget that will eliminate thousands of jobs and threaten our economic recovery. All requested amounts are a direct result of the pandemic and the necessary measures taken to address the pandemic’s consequences."

Also, the city has already received about $483 million in federal and provincial funding this year to address the transit-related shortfall, but Tory emphasized that Toronto’s deficit "far exceeds this amount." Despite this, Tory maintained his pledge to keep property taxes below inflation, with a 2.9 percent increase in 2022.

During the municipal elections, the mayor said the budget would instead be balanced thanks to "prudent financial management," revenue from TTC and partnerships with other governments. However, in the letter, the mayor appears to be relying on a significant contribution from those partnerships to offset the shortfall. Additionally, Tory is asking Ford and Freeland to provide an "immediate funding commitment" for both 2022 and 2023 by the end of the month.