Transit users in Toronto are probably facing a fare increase in 2010. (Canadian Press)

TTC chair Adam Giambrone says there won't be any service cuts in order to balance the transit system's books — so unless the province or the federal government come up with a lot more subsidy money, transit fares are going to go up in Toronto.

"Fuel costs are up. Our labour settlements that were mandated by a mediated settlement are up. All of these realities — everything is before us. But I am not prepared to cut service. That is the worst thing that you can do to the TTC. People need our services," Giambrone said during a Wednesday morning news conference to promote the Metropass program.

A day earlier Giambrone said the transit authority was facing a shortfall of about $100 million in next year's operating budget. If the TTC won't cut service, then raising fares is the likeliest route to replace that money.

Two years ago Adam Giambrone threatened to close down the Sheppard subway line in order to balance the TTC budget — and then had to back down in the face of a huge public outcry.

Now he's leaving little doubt that "the better way" is going to cost riders more starting in the new year.

"A 10-cent fare increase generally brings you about $22 to $25 million," said Giambrone.

The transit system received almost $394 million in subsidies on its $1.3 billion operating budget this year.

Some reports suggest the TTC will ask the city to increase its funding and combine that with various fare increases to replace the $100 million.

Dealing with the shortfall has become a priority for the TTC.

The commission has moved up its regular board meeting to Nov. 17 to deal with the issue.