City of Bellevue officials are now projecting a $6 million budget shortfall over the next two years, prompting a hiring freeze, and potential layoffs, as they look at options.

In an email to employees, officials said that the lagging economic recovery has led to 2 percent less tax revenue from both property and business and occupation sources. The change will force the city to scramble to make up the deficit, only months after finishing up its two-year budget.

That budget included a cut of 59 city positions. And, according to the City Manager’s office, the latest news may require more personnel cuts.

“As you know, we made every effort to minimize impacts on staff in the last budget process,” City Manager Steve Sarkozy and Deputy City Manager Brad Miyake wrote in the email. “We’ll make the same effort this time around, but layoffs may also need to be part of the conversation.”

In addition, the management team has asked department heads to “take a timeout on any new hiring” that isn’t previously approved by the city manager.

Council Members were disappointed with the news that the economic recovery had slowed, but confident in the administration’s ability to handle the challenge because of the most recent budgeting period. Council Member John Chelminiak pointed to a healthy reserve the city could dip into if absolutely necessary.

“You don’t want to dip into them, but in terms of being able to whether something over a year, I think we’re in good shape,” he said. “I think the whole reset we did with the budget has put us in good shape to do that.”

Sarkozy and Miyake have asked heads of all department to come up with ideas to save money so more cuts can be avoided. Those ideas could include “organization and structural changes, working more efficiently with fewer resources, and the use of reserve funds,” the city memo said.

Chelminiak said the City Council is doing its best to encourage business and development. He pointed to a resolution to extend a number of building permits, to give developers time to make sure projects can be completed.

Council Member Jennifer Robertson pointed to a prioritization process during the budget period that could make the job easier. During that process, she said the council created a line of priorities in which programs slightly above can be cut or reduced to make room for the highest priority programs, such as public safety. Robertson also wanted to make sure that the budget process doesn’t have a huge impact on employees.

“I’m really hoping we can do this in a way that is not detrimental to our employees,” she said. “Unemployment is high already, and we don’t want to add to it if we don’t have to.”

Sarkozy and Miyake applauded the efforts of employees and said that as a team, they can come up with the solution to the problem.

“We know it must seem like we just finished the Budget One process from last year, and now, here we go again with more belt-tightening,” they wrote. “We share your frustration, but we’re confident that with your help we can meet this latest challenge as well.”