Summary of Lessons Learned for City of Hayward Financial Situation (February 2026)
• Adhere to Financial Best Practices
o Accurate baseline financial projections grounded in market and financial realities that are updated and shared regularly
o Appropriate use of one-time and ongoing funds
o Appropriate budgeting of over-time, salary savings, and realistic revenue estimates o Appropriate accounting of restricted funds
o Appropriate accounting of reserves, including separate reserves for liquid and non- liquid assets (i.e., cinema place)
o Strengthen internal monitoring and controls, including regular departmental budget meetings and post-budget reviews
• Improve Transparency and Accountability
o Regularly share and analyze updated projections and actuals internally and externally, including key revenue updates
o Establish and adhere to financial policies grounded in financial best practices o Hold each other and our colleagues accountable at all levels of the organization o Create a culture of collaboration, transparency and “see something, say something” • Practice Strong Leadership at All Levels
o Raise and vocalize issues and concerns with Council, staff, labor partners and community
o Attract, retain and train qualified staff
o Be prepared to make difficult or unpopular recommendations grounded in financial realities
• Financially Constrain Labor Negotiations and Contracts o Educate Council, negotiators and labor partners on current and future market and financial realities based on updated financial projections and trends o Institute an iterative process with Council and Finance Department regarding cost of contract proposals and approvals from the beginning to end of negotiations o Establish consistent salary survey and equity adjustment methodologies grounded in market realities and Hayward‘s financial situation that are equitable across bargaining groups
o Consider risk sharing measures, such as floors and caps on market driven salary and equity adjustment increases, potential increases tied
to City financial performance, and use one-time lump sum or other economic benefits instead of ongoing increases, as appropriate
Attachment III