Kitchener City Hall is pictured on Thursday, July 3, 2014. (Kevin Doerr / CTV Kitchener)

The latest financial update from the City of Kitchener predicts a $5.8 million deficit because of the COVID-19 pandemic.

The July Financial Impact Report says tax-supported operating deficit has increased slightly since June. The new costs are from reopening some of the city's recreation facilities like splash pads and pools. The city says there are extra costs to reopening due to safety measures laid out by the provincial government.

According to the report, the city's most significant loss is from recreation revenue. As a result of the pandemic, the city expects to lose around $7.4 million before the end of 2020. Public health measures are expected to last into the fall, meaning the city could lose more revenue from a lack of user fees, programming and facility bookings.

Last month, the city approved a plan to defer $21 million in capital spending projects to help mitigate the COVID-19 losses. Another $1.3 million in projects were also cancelled.

The city says it's hoping to receive funding from other levels of government to help with its economic recovery.

The report says parking demand has dropped significantly due to the pandemic. Parking deficit is projected at $2.1 million in the July financial update. The city says this deficit exceeds the amount in the stabilization reserve by $860,000.

The City of Kitchener started enforcing paid parking again on Monday.