Hollister Rescinds All 36 Layoff Notices After Firing City Manager

All 36 layoff notices issued to City of Hollister employees on Oct. 14 were rescinded by a unanimous city council vote on Oct. 26, five days after the council fired City Manager Ana Cortez in a 3-2 closed-session decision. For municipal workers in this California city of roughly 40,000 near Salinas, the reversal is real but conditional: Mayor Roxanne Stephens says major cuts — and possibly new layoff notices — remain on the table.

What happened, and when?

The sequence moved fast. Cortez issued the 36 notices on Oct. 14, informing affected employees they would go on administrative leave with employment ending Nov. 13. At the Oct. 21 special session, the council voted 3-2 to terminate her contract "for convenience," with Vice Mayor Priscilla de Anda and Councilmember Rolan Resendiz opposed. City Attorney Dayna D. Louie confirmed the vote. At a two-hour closed session on Oct. 26, billed as a "conference with labor negotiators," the council unanimously rescinded every notice.

The affected employees included nine civilian police staff members plus workers in public works, airport, parks and recreation, and finance. The council has appointed Hollister Airport Director Jeff Crechriou as acting city manager while it weighs permanent options. No timeline for a search was discussed. Cortez had been hired in February at an annual salary of $265,000.

How deep is the financial hole?

The backdrop explains the urgency. At the Oct. 2 meeting, Cortez claimed the city had only $178 in its general fund bank account and could not cover the next payroll. The same night, the council approved an $18 million loan from its impact fees fund to the general and water funds to make payroll. Officials attribute the crisis to years of inattention and mismanagement by previous councils and staff.

Two moves at the Oct. 19 meeting set up Cortez's exit: the council reversed its own Oct. 2 declaration of "financial emergency" and ended the laid-off employees' administrative leave.

What did the unions say?

The layoffs never had labor's consent. Cortez faced accusations she issued notices without consulting unions, department heads, or other city officials. Members of the Hollister Police Officers Association and the local Service Employees International Union chapter passed votes of no confidence and demanded her termination.

HPOA President Bo Leland told the council it should "write the final chapter of Ana Cortez's legacy," and went further on the numbers behind the cuts: "It's become abundantly clear that the previous administration either manipulated financial information to advance a political agenda or fundamentally failed to understand the city's finances. Neither explanation is acceptable. The financial information presented to this council can no longer be trusted, yet that same information was used to justify laying off dozens of dedicated city employees."

SEIU chapter President Frank Garcia, who works in the stormwater division, said officials have acknowledged errors in City Hall financial reporting that may have shaped the layoff decisions. "Your employees should not bear the pressure of that (Nov. 13 layoff) deadline while the city sorts out its errors," Garcia said. "Please rescind the layoff notices. Give us a fair opportunity to reach an agreement based on accurate financial information."

What does this mean for the 36 employees?

Their jobs are safe for now — no termination date, no administrative leave. But the mayor was blunt about the arithmetic. "We need some very solid concessions from all of our unions," Stephens said. "This is really, really hard work because we are not out of the woods financially. We need to come up with a different plan to move forward…The more concessions we can get, the fewer job losses we can anticipate moving forward."

City HR staff have been meeting with union representatives since Cortez's firing, and the council will meet at least weekly on savings options. One open legal question: whether the "for convenience" contract language shields Hollister from paying Cortez severance — the source does not say.

For public-sector practitioners, the read is straightforward. Rescission buys time, not solvency, and the next leverage point is the concession bargaining now underway between HR and the HPOA and SEIU locals.