Mayoral candidate George Smitherman offered up his fiscal plan for Toronto while opponent Rocco Rossi came out in favour of separated bicycle lanes -- off major arterial roadways.

During a lunchtime speech Monday to the Economic Club of Canada, Smitherman said he could balance Toronto's 2011 operating budget with $265 million in restraint and an assumed $100 million in TTC funding from Queen's Park.

"People have to understand that in times of restraint with respect to the public purse, those of us that are paid from the public purse have to be very, very reasonable in our expectations and may have to offer some sacrifice," Smitherman told reporters afterwards.

Smitherman promised to reduce the $60 vehicle registration tax by one-third and allow seniors to use the TTC for free between 10 a.m. and 2 p.m.

He would reduce the city's employee headcount through attrition by only replacing two-thirds of staff who leave through retirement. However, the TTC, police, fire and Toronto EMS would be exempt from that program, along with staff for provincially-mandated programs.

Smitherman proposed $236 million in new spending, $265 million in savings and new revenues of $298 million.

Among the new spending initiatives announced by Smitherman are a tax rebate on multiple-unit apartment buildings and a youth employment program.

Some revenue would come from the sale of city lands and its stake in EnWave Energy Corp., the heating and deep-water cooling business. Savings would also come from better procurement practices.

Smitherman has promised a property tax freeze.

In 2010, the province did not give Toronto any funding for TTC operating costs. Smitherman said an additional $100 million from the province would bring Queen's Park's contribution to TTC operating funding up to 50 per cent.

Smitherman said his cost-reduction plan is much more moderate than that of Coun. Rob Ford, who is considered to have a strong lead in the mayoral race.

Ford is expected to release his full financial plan through a YouTube video early Tuesday morning.

Rossi on cycling lanes

In a news release issued Monday, Rossi said he would build four new bicycle lanes separated by a curb from vehicle traffic:

one east-west late would run from Parliament Street to Bathurst Street along Richmond Street

another east-west route would run along Wellesley-Harbord Street and be separated from traffic between Parliament Street and Ossington Avenue.

the existing Sherbourne Street bicycle lane would be separated from traffic between Elm Avenue and Queen's Quay.

a second north-south lane would be added to George Street-Beverley Street and would extend southward to Queen's Quay

"You will be able to bike from the Annex to the Harbourfront on a single, safe, direct bike lane," Rossi said in the release.

The city recently built some new bicycle lanes on Jarvis Street, removing the fifth lane south of Bloor Street to make room.

Patricia Best, a spokesperson for Rossi, said he does not think there should be bicycle lanes on major arterial roadways.

Rossi issued a news release later in the day attacking Smitherman's budget speech.

"The question Torontonians want answered is 'who can stop Rob Ford,'" said Rossi. "After today's speech it's clear it won't be George Smitherman."

Rossi was running fourth in a Nanos Research poll conducted for CTV, CP24 and the Globe and Mail. It was released on Sept. 19.