Los Osos hires district manager during contentious meeting

October 5, 2013
Kathy Kivley

Kathy Kivley


Amid screams of outrage from the audience, the Los Osos Community Services District Board of Directors hired an embattled executive Saturday as its new general manager.

During the 8 a.m. special meeting, the board voted to hire former Atwater City Manager Kathy Kivley to serve as the district’s full-time general manager at an annual salary of $90,000.

After publishing a staff report Friday, district legal counsel Michael Seitz refused to disclose details of the contract or the name of the candidate. He said those details would become public during Saturday’s board meeting.

“If the board is comfortable with the contract, it will be time to approve it,” Seitz said Saturday after he gave each of the directors a copy of the contract. “Then it will become a public document where you can take public comment at that time.”

However, the California Ralph M. Brown Act requires agencies to make documents pertaining to open session meetings available to the public after a majority of the board receives a copy, according to section 54957.5 of the Brown Act.

Shortly after the meeting started, members of the public, some swearing, demanded to see the contract before public comment and before the board took action. Seitz argued against allowing the public to participate in the process until after the vote.

Seitz then recommended that the board halt its open session and approve the contract in closed session.

But, the board rejected its attorney’s advice and chose instead to allow members of the audience to read the contract and make public comment prior to the board voting in open session.

Seitz, who was dressed in flip flops, jeans and a sports jacket, then passed out copies of the contract to each member of the audience. In order to allow the public time to read the contact, the board took a 10 minute break.

Nevertheless, attendees complained that they were unable to look into the candidate’s background because they were not permitted to know the name of the applicant until minutes prior to her appointment.

In April 2011, the Atwater City Council made Kivley its city manager at a base salary of $134,000.

In September 2012, the Atwater City Council voted to fire Kivley, according to the Merced Sun-Star. At that time, the city had a projected $3.7 million negative general-fund balance for the 2012-13 fiscal year.

The Los Osos board made no mention of Kivley’s termination at the meeting Saturday and approved her contract by a 4-0 vote, with Director Michael Wright absent.

“She impressed all of us with her knowledge and experience,” Director Marshall Ochylski said. “Kathy stands out in a very good pool of candidates.”

Kivley, who does not yet live in Los Osos, participated in the meeting Saturday by telephone. The board agreed to pay her $7,000 to relocate to the Central Coast.

Kivley, 65, will begin work on October 14.

“I look forward to working there and I also look forward to living there,” Kivley said.


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The “water saving grant of 2004 was for $500,000 the one gotten by the County for this project is $3,800,000. The water rate increases since 2004 are what has really effected water savings, as is evident by the poor participation in the County’s conservation program.

No, Jeff didn’t apply and the person we support is not an anti-County person. You should learn who it is before you say much more, I think he’d even have your support.

As for hiding the numbers, the Cleath Tech Memo’s were available years ago, the numbers were known by the IJS but not included in the discussion to the public.

As for assessing all well owners, this is proposed to be a weighted vote, so someone with 500 acres would get 500 votes, you and I would get fractional votes, since we have fractions of an acre. Would drawing up an assessment district to go after these heavy weights actually pay off? I’d like to see that analysis before we spend a ton of money on it. It may not be worth it and if the projects are marginal/experimental, why would anyone support them?

I still don’t see why you have so little trust in the Board to select a GM. Or why you think an internet search and no candidate interview gives you the edge on selection. No, I have no idea who applied and have no way to find out any of the other candidates unless the CSD makes it public which I doubt. How is it that you know who the candidate was? That is usually a private Board matter.

I don’t get why Jeff made a couple of unwarranted comments to me either when he walked into the LOCAC meeting today. I really don’t think a person’s age has any place in this employment discussion.

Where did it say it would be a weighted vote in the Basin Plan? What page is that on? No matter how marginal/experimental YOU think the projects might be does not affect how voters vote. Just ask the vacant land owners. Just ask the people who have wanted to add an extra bathroom and couldn’t (well, some of them did it anyway as we know, just under the radar). Just ask anyone who would like to build a project in this town how they would vote.

So how are the public Cleath Tech memos, which have been available to the public for years (they were available at CSD meetings in 2009), how is that “hiding them by the County?” They WERE discussed in public. There is a 2010 memo from the Water Board which discusses them too. To get to the designation Water Level Severity III, the BOS discussed this as well. So again, how is the County hiding these reports?

But I do agree. The water rate increases have certainly improved the amount of water being used, it is much less now. The goal is water conservation and if the County spends less on retrofits but still achieves the same goal, that is just more money out of the $5 million that can be spent to tweak the program and do more conservation outreach or other programs. New residents arrive daily and have no idea what is going on here.


Do you read what you write or what you are responding too?

The 2009 Cleath Tech Memos did not include prices for the very same projects presented in the Basin Plan released in 2013. Get it now?

Marshall told some of us in the back of the room at Thursday’s LOCSD meeting that the vote would be weighted. How else could it be conducted? It has to have benefit attached to it.

Are you kidding to think I don’t know what vacant lot owners and people wanting to add a bathroom or bedroom want? That’s what we do for a living, listen to these very people you suggest haven’t been heard. You supported the County’s bifurcating water from wastewater, not me.

As for the candidate who applied for the GM position, he told us himself and others he had submitted his application. Feel free to request any letters of recommendation that were sent in by members of the public, they should be public record.

Maybe you and I should sit down for a point counter point conversation one of these days instead of airing dirty laundry for all to see. Let me know, I’ll make time for you.

Don’t you get it? The County IS NOT going to spend $$5 Million, only the $3.8 from the grant. They didn’t budget for the COA, so they had to ask for a grant, they didn’t get what the COA required, so they are going to take credit for the 50 gpd. per person that they didn’t achieve, the purveyors did, through rate increases. We use 43 gpd, per person now. Imagine what we could be down to if they applied their rebates to other high efficiency appliances.

I don’t speak for Jeff, ask Jeff what his beef with you is.

Why would a Cleath report supply prices? What do you think that the County was hiding? These projects are a CSD water company deal along with the others in the ISJ. We had to wait for the Basin Plan to get prices and even now they are only ballpark.

The bifurcating you speak of was a result of the Lisa Board losing the wastewater project. The County doesn’t own a water company in LO, only a well. They were bifurcated at that point.

So what you are saying is that you are bummed that the County isn’t spending $5 million of our assessment monies, and only $3.8 million from a grant? That’s a bad thing? The project should be MORE expensive per person, not less? Huh?

Also, please point out to us readers somewhere online that we can see that the County is spending just the the $3.8 million when the Coastal Permit states it must spend $5 million. It looks like 5 million to me in the March 2012 Water Conservation Implementation Plan, see page 7 of the document (page 10 if you open it in Acrobat). Please explain where this changed.

And what was the name of the grant? We got a $4 million grant from the USDA.

Does it really matter how the 50 gallons was achieved? Was not a lot of retrofitting done (and more to be done still, people always wait until the last minute) due to the project that never would have happened without it. Where do you get the figure of 43 gpd per per person? Mr. Margetson keep saying we are near 50, but not there yet.

I prefer airing FACTS in public. Besides, how is this dirty laundry? It is just facts on the project and the water issues. It is very important to make FACTS public.

The “we” down to 43 gpd., is my house.

The IRWM grant is covering conservation. The program has incentives Lynette, people aren’t taking advantage of it, you tell me why not, I don’t have that answer, See the monthly updates for the Conservation budget ($3.8M).

Gibson said (to another resident at the Dem’s healthcare meeting last week) that “We always knew” the costs associated with the ISJ. He might have, but “we” (the public) didn’t. The County, who controls the ISJ – don’t kid yourself if you think there’s been consensus all along the way – did NOT want those figures out at the same time as the LOWWP was being approved (2009).

The County’s involvement in the ISJ is because they allow the land use permits that allow for use of water. They are the planning authority, this is why the LOCSD included them in the lawsuit.

Yeah, the County owns one well that irrigates the park. They also maintain the sprinkler system that sprays all over the parking lot and is wasting water.

Bifricating water from wastewater was to shift the burden of water management away from the LOWWP onto the purveyors, also shifting costs associated with groundwater management away from the already high cost of the LOWWP. Again, you supported it, not me. I went to Sacramento and argued for the amendment in AB2701 to give the County the authority to manage the water. They could have used that authority as part of the project and chose not to.

See you at the BOS, where the sewer plant will go out to bid. Just $10M over budget.

Well, it is too bad that the possible costs for the treatment facility will go $10 million over budget. We’ll have to see just what the actual bids are on November 21 however.

The project really lost the best bidding environment time frame with all the delays (the relentless Step/Steg advocacy being the most egregious time stall) but that’s the way it went. No point in complaining about it now, especially when you were part of the delays yourself.

Since the County is roundly dissed, you among the forefront of those critical of it, I can’t imagine why you would want them and not the purveyors to control the water. In any case, there are three purveyors, one being a public company, and to strip water rights from them would have resulted in the mother of all lawsuits, thus delaying the project indefinitely. But then, maybe that was your goal.

Your speculation on when the County knew what about costs was just that, speculation, from heresay yet! Your bounty of ways to criticize the County and this project is really just overflowing. And endless, unfortunately.

Good news on the grants though at the BOS today, we got that Recycled Water Grant – somewhere between $3-4 million. So to recap, $4.1 mil from USDA, $5.9 mil from IRWM, and a sort of grant, $7.5 million in forgiveness from the old SRF loan that Los Osos won’t have to repay due to stopping the last project. The WRDA money is still out there (but due to National circumstances, I’m not holding my breath) and maybe the State will lower the SRF interest rate if the County agrees to keep the project, which was the condition the County did not agree to at the last go around in an attempt to lower the rate.


I wanted one project that solved SWI and satisfied the RWQCB. That would have been a holistic approach WWP, it would have saved a tremendous amount on permitting and environmental mitigation. Now we will do double the work on those efforts, more soft costs, with no improvement to water quality.

I don’t know what you mean by “strip” water water rights? Who’s? Why?

The County missed the bidding environment and could have done competitive bidding on a plant design. They could have designed the plant at least a year earlier, just like with Mountain Cascade they could have locked in a bid price and had them wait, or work simultaneously, rather than the double handling that will go on now that they’ve moved the sand to Andre, now they’ll move it again to mix in with Giacomazzi’s clay.

I’m not going anywhere, I will continue to watch as the project unfolds.

Okay, just a comment from the outside. I have no horse in this race.

You people are a bunch of nut jobs. Seriously. All of you.

They wanted to see her employment contract before the thing was signed? That’s ridiculous and none of your business, to be frank.

You elected the CSD board to handle such things as hiring and firing the GM. They should be trusted to craft a contract that’s acceptible for everyone.

And even if they don’t there’s not a damn thing people screaming from the back of the room can do about it. The board has this authority. If you don’t like it, then put your name on a ballot and stand election.

And she’s a manager for God’s sake. The staff that’s already there will bring her up to speed. I doubt one has to know everything before they start riding herd over the operations.

I’d bet that type of work is quite similar no matter what level of government — city vs. CSD — so why worry?

This is the exact reason that the CSD GM job has had a revolving door all these years. No matter who gets hired they are met with a flurry of criticism over who they are, where they come from, who hired them, how much are they being paid, what they’ve done in the past, etc. ad naseum.

For once, I’d like to see these constant complainers shut up and give someone a chance. They might surprise you and if they fail the whole community and not just the complainers, then fire them and get someone else.

Niles Q,

CSD’s are very different from cities. That mistake has been made too many times before.

Los Osos is unique, like no other, seawater intrusion is the name of the game. It’s an emergency and to bring anyone in that doesn’t have a foundation in water matters, will be difficult to bring up to speed. It is no easy issue and how to over come that is far from a slam dunk. ($67 million in projects have just been laid in our laps).

By law, the contract (signed by Ms. Kivley on Oct. 3); once made available to the majority of the Board becomes public record, the public had every right to ask for it. Thumbs up Moothart for providing it.

Remember Shaunna Sullivan’s PZLDF contract Julie? Does the phrase “Brown Act violation” cause a twinge? I seem to remember a time when that contract was signed in closed session and the item was only announced on the agenda after the fact, the possibility of signing it was never agendized at all as a closed session item. Did we get to see THAT contract? Even Mr. Margetson blew a gasket on that one.

Remember the District reserves that vanished and even you didn’t know where they went under the GM that your board hired? How much public input did you get in hiring Bleskey?

We have excellent staff, counsel and a district engineer (all well versed in our seawater intrusion) who will, I am sure, bring Ms. Kivley up to speed.


Do you still have a copy of that contract? I bet you do, I would have to request it from the district. The staff is spread so thin, I would hate to do that just to refresh my memory on that LOCSD chapter long, long ago.

Did anyone (you, Margetson, Taxpayers Watch?) formally challenge the action? There is a 90-day window in which any member of the public can challenge a Brown Act violation asking that it be cured & corrected; no one did that I recall.

Trust me, I know the weaknesses of every GM the district has ever had, even those who served when I was a director. When I noticed something wrong, I called them on it. It takes a majority to make a change, often times I was the only one who spoke up.

Reserves didn’t “disappear” they were spent. Spent on legitimate district bills. Unfortunately, just as I have witnessed in Oceano, that GM did not know how to bring forth a budget adjustment in order to track the funds easily.

As for hiring a GM, the board is allowed to sole source one if they wanted (which is what my Board did) that’s not the question here. As I recall, the contract with Wildan was approved in open session.

The excellent staff, counsel and district engineer, have to be paid to bring Ms. Kively up to speed. Ms. Morrow was “brought up to speed” and never got it. We don’t have time, the Basin Plan needs to be implemented now!

I don’t know if I have a copy of the contract. That is beside the point. It was HOW that contract came into being that was the point. Not having someone pay money to an attorney to “fix” the problem does not mean that the problem did not happen. (I don’t think the cost of that Brown Act challenge was worth pursuing.) You might ask Mr. Margetson his recollection if you have forgotten. Or maybe Dave Duggan, I think he was there at that meeting too.

Did you call out Bleskey on not doing the appropriate budget adjustment on reserves? I don’t think so. I recall at a FAC meeting a couple of years back you didn’t know where the Fire Reserves went, nor did Mr. Margetson who usually keeps a VERY sharp eye on District money. If he did not know, the process was not at all transparent to the public and apparently not to the board either. Just how long was Bleskey employed by your board? And what does Oceano have to do with the conversation on LO?

Every GM is going to have some sort of weakness. Your scrutiny of a contract will not prevent that. You as a member of the public don’t get to sift through résumés, that is the job of the board we elected. As you should know hiring and firing is up to the Board. We don’t even know why Ms. Morrow was dismissed. If you don’t like how the board decides things, vote in a new board.

Paying staff, counsel and engineer to bring someone new up to speed is beside the point! The implementation of the Basin Plan does not solely rest on the shoulders of the GM either.

Yes I did call out Bleskey on many things; including his accounting. I also called out Hugh and Schempf and their poor management of the district. My colleagues were not as critical as I was, and when Joe got on the Board, you’ll notice, he and I were aligned quite often.

The contract was public record the moment the board received it yesterday. The woman’s name became public at that time, as I said before, Josh Friedman looked her up, her past became part of the equation.

No Lynette, the implementation of the Basin Plan does not rely solely on the LOCSD GM. As you know, seawater intrusion is advancing and projects need to get on the ground now.

***Oh and by the way, that coffee at the ESAC meetings at the fire house is purchased by fire fighter personal funds. Just wanted to let any CCN readers know that no “gifts of public” funds are being drank by the public at these meetings.

So you were NOT one who, “…complained that they were unable to look into the candidate’s background because they were not permitted to know the name of the applicant until minutes prior to her appointment.”

I just don’t see how complaining about her past is going to help the board that hired her get on in their interactions with her. We really know nothing about it and to pretend we know anything by a newspaper article is just stupid. The board fired her, so what, they don’t and can’t say why. It doesn’t mean she did anything wrong – maybe she called them out on their terrible financial practices and they didn’t like it.

The big projects that will truly be meaningful that you refer to, (other than the one we are awaiting grant money from), require a 218 to fund them. Sadly we are a long way off to be able to get some real work done – the fall of 2014 or spring of 2015 according to The Plan. Too bad we had to wait so long to get a sewer to get this Basin Plan rolling. Let’s see, the ISJ, primary to creating the Basin Plan was started in May of 2004…..

The room of attendees wanted to see the contract. I would have preferred to have read it days earlier when the agenda was posted. I would have done the internet search myself and been able to argue her qualifications. Instead, I (and others) was only able to argue deal points of he contract, but only got to do so because Leonard was transparent in opposition to Mike’s recommendation.

You are speculating on what happened in Atwater, I don’t really care about that at this point, its what she offers and doesn’t offer. I do know who one of the other qualified candidates was and there is a learning curve that could have been avoided and no scandalous firing in his past.

Lynette, there are two types of 218 votes, rate increases will also be used, not just the assessment district. The current CIP list can/should be modified to move BP projects up.

You don’t have to tell me how long the BP has been in the works. You can tell me why the County hid the numbers associated with the projects. Hmmmm $67 million might be a bit difficult to choke down?

I can’t reply below Julie’s comment, there are no remaining “reply” boxes, so I will reply above it here.

An internet search will reveal a person’s qualifications? And just how much of that would be newspaper articles or junk?

So basically you are saying you do not trust the board to make a good decision, but rather YOU would know better with an internet search and NO personal interview. You, the person who I believe anyway found Bleskey, and certainly approved of hiring him!

Not one of us knows what happened in Atwater, but YOU know it was a “scandalous firing?” Really? REALLY?

What I really see here is you being bummed that your preferred candidate, (maybe one with a strong dislike for the County?) did not get the job. Was one of the candidates Jeff by any chance?

I am well aware that there are two types of 218 votes. The idea is to get ALL basin users to chip in on improvements and that can only be achieved with a 218 vote that includes them, not a rate increase type 218. Those basin users have wells, not a water company that does a rate increase. I would rather lower my share to pay by including ALL basin users, wouldn’t you? Please refer to pages 296 -297 in the Draft Basin Plan.

When the COUNTY hid the numbers? Just when was that? The Basin Plan just came out August 1 and the ISJ was not going to leak numbers early for people to speculate on without the report.

I guessed you missed my point on the date of the ISJ, 2004. Had the former project gone ahead, the CSD would not be bankrupt, the more comprehensive water saving measures than we have now would have been operational since 2008 (FIVE YEARS AGO), many capital improvement projects would have been funded, and we would not be having this conversation.

With all due respect, Julie, there is no difference in the management of a city than there is with the management of a CSD. Full service CSDs have all the elements of a city with the exception of planning and building, road maintenance (except in specific cases), and a few other minor elements covered by the county. Some CSDs (like Heritage Ranch) even have filling station responsibilities.

Is that you Mitch Cooney?

CSD’s are governed by Gov’t Code 61000, a different animal than cities. Additionally, as is the case in Los Osos there are no General Funds.

So the function of funding projects just get funded from different sources. You are confusing management Julie with the sources of funding. CSDs generally have less to do than a city, but still require management.

If that is you Mitch, howdy, and I hope that things are going well for you. Thank you for your service on the LOCSD!

Can anyone comment about the second item on yesterdays LOCSD agenda?

That item was the disinvestment of the Solid Waste franchise from the LOCSD to the County(as [part of the LOCSD Bankruptcy settlement).

What did the LOCSD Board decide.

Was there any public comment?

Jeff and I attended.

The Bankruptcy item was pulled from the agenda, it was explained that there is some continued tweaking being done to the settlement that includes transferring the solid waste franchise to the County. It appears there may be some language being crafted that would allow for it to be transferred back to the district some time in the future.

Most comments (including my own) expressed displeasure with the transfer.

Marshall Ochylski went into a long explanation on how we got here (most in the room were quite familiar with most of what was said, but we did all have a good chuckle when he referred to bankruptcy attorney Joe Sholder as “outhouse counsel.”)

They did add an urgency item to the agenda, which included a Closed Session update on the Bankruptcy.

Outhouse counsel indeed. I was sure you were referring to Seitz however. As involved in local affairs as your are Julie, I ask you to name one government agency either of the Seitz bros have stuck their tools into that isn’t a utter cluster fug?.


I’ll be honest with you. There’s not single one agency that is squeaky clean. The Brown Act is just vague enough that the only “punishment” would be a “do over,” which would likely get the same votes, so it is not cost effective to sue over BA violations. Mike Seitz at South San was recently served a “Cure & Correct” for a BA violation, Kevin Rice and I filed it in hopes to have the item heard in Open Session. It was clear that the majority of that 3 member board did not want to re-hear the item in open session, so they refused, but had they “cured” it the vote would have been the same.

Sadly, the larger problem is so few people participating in government to hold each agencies feet to the fire and demand transparency.

Good lord. She looks like someone who routinely camps out at the Elk’s Club from opening to closing.

The faux “special meeting” reminds me of a quote my mother–who was a political activist–used to use:

“Cowards act under the cover of darkness because they fear to act in the light of day.”

I attended and was very displeased with the 8:00am agenda, more displeased when most of the board members rolled in after 8:00am and the meeting didn’t start until 8:15am. Three of the four still had bedhead.

Mike Seitz was indeed wearing flip flops and a sport coat, that was good for a chuckle.

Seitz was adamant that the action would be taken prior to the public reading the contract, this, in my opinion would be a Brown Act violation. I suggested to President Moothart that he had discretion and could allow the public to see the contract before they acted. He agreed, allowing the public ten minutes to read it so they could have informed comments.

Friedman looked up Ms. Kively while we were sitting there, I have to say, I was stunned to think they would hire a stranger with this background at this critical (implementation of the Basin Plan) time. It’s de’ja’vu of Susan Morrow. In fact the contract is a cut and paste of hers, even the address of the candidate is the same. 1189 Los Osos Valley Road (also known as, the post office).