Hayward city manager warns of $27–30 million shortfall; layoff notices to go out as council seeks concessions

Jennifer Ott, Hayward’s city manager, told the City Council on Dec. 16 that the city is confronting an operating shortfall in the range of about $27 million to $30 million and that layoff notices would be issued the next day. "Those notices are going out tomorrow," she said, noting the administration had already identified roughly $16–17 million in savings but still faced a large gap.

Ott said Measure C reserves cannot be spent down without risking cash-flow problems and potential breaches of bond covenants, and explained why borrowing enterprise funds is not a sustainable fix. She told council and the public that staff would present budget-to-actual reports starting in January after the reductions and revenue assumptions are encoded into the budget system. The city scheduled an expedited budget work session for Jan. 6 and more comprehensive budget deliberations in February.

The update drew immediate public response. City employees and union representatives urged the council to delay layoffs and to meet-and-confer with labor before notices were distributed. Union speakers described concessions already offered and warned of service losses and harm to residents if layoffs occur. "This crisis was not created by the workers," said Amber Potas, a SEIU Local 1021 member. Nora Huntley, representing clerical and maintenance chapters, demanded an official meet-and-confer prior to any layoffs.

Council members acknowledged the severity of the shortfall and the difficulty of the choices ahead. Several members expressed regret about past budget decisions that contributed to depleted reserves and supported continued negotiations with labor to reduce impacts. Council also directed staff to continue identifying revenue options, including increasing the transient occupancy tax (TOT) and considering a business-license tax review, and emphasized that any changes in operation hours, property disposition plans or revenue measures would be brought back to council.

Next steps on the schedule: the city manager and finance staff will issue layoff notices as announced, staff will present budget-to-actuals and additional analyses in January, and a larger budget work session is planned in February to consider structural options including property disposition and further revenue proposals.

If layoffs proceed, the council may still take formal action in subsequent meetings to approve concessions, revenue measures or other mitigation steps.

Sources and provenance: City manager oral presentation and council discussion (City Manager Jennifer Ott; staff presentation, Dec. 16, 2025).