The report shows an income of less than $2.3 million than expected from April to October.

"The impact of COVID-19 on council's business operations has been significant with a number of areas being closed for periods of time or operating with tight restrictions," the report states.

The closure of Aquazone meant an income of $81,084 however $1,129,080 was projected.

The income from parking was down more than $975,000 than expected, while the Lighthouse Theatre takings were $943,000 less than expected.

The total difference in budgeted and actual income was $4.27 million but when you take into account the savings with regards to expenses the total difference is $2.382 million.

Despite the impact, the council remains in a favourable financial position of $640,000 more than forecast.

The report states this is due to a number of factors, including childcare receiving transitional funding from the federal government, holiday parks opening sooner than expected and additional building and development activity increasing this income.

A council spokesman said in the past calendar year the council had reported a sharp increase in the level of planning permit and building activity.

"In what has been a difficult year for some of our local businesses impacted by COVID-19 restrictions, this rise in the level of planning and building permit activity in Warrnambool is further evidence of the resilient base of our local economy and the many attributes that make Warrnambool a great place to live, work and invest," the spokesman said.

"For the 11 months ended November 2020 council has received 291 planning permit applications, a 23 per cent increase on this time last year.

"Similarly, the number of building permit applications has increased by 31 per cent from the previous year (507 to 669). Vacant land sales and residential construction are performing strongly across numerous growth areas in our city with strong interest both at a regional and metro area level."

The report also reveals the council has secured a range of funding to help with the coronavirus recovery.

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