London's budget gap may be too far to bridge.

Even if savings can be found, the city's treasurer is issuing a stern warning against such a move.

A much thinner draft budget document than in previous years was handed out to councillors Tuesday afternoon.

But the lighter document still contains heavy decisions, including how to cover escalating costs with fewer sources of new revenue.

The initial budget gap sits at 3.1 per cent or about $15.1 million.

That works out to a tax increase of $76 on the average London home.

Most of that increase is driven by the budget requests from outside boards and commissions funded by city hall, including police, fire, ambulance, the LTC and library.

Requests from police and fire make up a third of the overall increase, prompting the mayor to suggest something has to give, but wouldn't directly address possible job cuts in protective services.

"That's not sustainable. They will have to make the decision of where they deploy the money we send them," says mayor Joe Fontana.

Even after seeing the grim numbers, Councillor Paul Van Meerbergen says he sees a clear path to cost savings and a zero tax increase - shrinking municipal government.

"What I would like to look at is redundant positions throughout the corporation to find savings," says Van Meerbergen.

The city treasurer warned council against pushing for another tax freeze, suggesting upper levels of government may resist funding city hall's multi-million dollar economic development plan if it perceived local taxpayers aren't sharing in the expense.

"There is potential that we would not see funding from other levels of government because they don't want to fund that zero percent," says Treasurer Martin Hayward.

Londoners can have their say on the city's budget at a series of public meetings in mid-January before deliberations start January 30.