Los Osos board calls for investigation into GM’s pay

October 13, 2015
Kathy Kivley

Kathy Kivley

The Los Osos Community Services District Board of Directors voted in closed session Monday to hire an independent investigator to examine allegations that CSD General Manager Kathy Kivley misappropriated district funds.

A CalCoastNews analysis of the district payroll found Kivley has overcompensated herself by more than $4,000. Kivley has been collecting pay for more administrative leave days than her contract allows. She has also been receiving more holiday pay than her contract allows, documents show.

Last week, the board received a letter from former board member Julie Tacker, who also conducted an analysis of Kivley’s payroll documents. Tacker informed the board of similar financial discrepancies.

At the meeting Monday evening, about a dozen members of the public called for the board to fire Kivley for a variety of reasons.

Following the closed session hearing on Kivley’s performance, the board announced it agreed to hire an outside investigator and that two members of the board would lead the search for the individual. The investigator will only be tasked with investigating the alleged misappropriation of funds, according to the board announcement.

Recently, an auditing firm that examined the district’s finances revealed Kively engaged in questionable accounting practices during her first year on the job. The auditor also found the district disbursed extra overtime pay to at least two employees.

The audit prompted San Luis Obispo County Auditor-Controller Jim Erb to send a letter to Los Osos board members saying the auditor’s findings should be of great concern to them.

In 2013, the board hired Kivley even though she falsely stated on her job application that she had never been terminated. Kivley was fired from the position of Atwater city manager in September 2012 and the position of Clearlake city administrator in November 2006, according to local media reports.

On Monday, Kivley left the meeting as the board convened for closed session. She did not return.

Closed session began with a hearing on existing litigation over the Los Osos Groundwater Basin. Kivley missed that hearing, as well as the item on her performance as general manager.

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It is a big surprise that the Board decided to investigate only the overpaid wages.

An investigation on all of the issues brought to the attention of the Board should be investigated. All of the issues given to the Board for some action truly exist. Why is the

Mr. Seitz knows that if there is dishonesty on an employment application it very likely there will more dishonesty. If the Board was aware that she falsified her application they should have made her re-do it for the files especially if they were aware of the situation.

She not only lied in regards to her City of Atwater dismissal she also falsified the fact that she was also fired from the City of Clear Lake. Both times for the mismanagement of finances.

She left both agencies in the red for large amounts due to her bad decisions.

It totally amazes me that three members of the Board think that this will not happen to the Los Osos Community Services District. At this point nobody knows. It is as scary as Halloween. Cash balance reports as well as restricted and non-restricted fund balance reports have not been generated since Kathy Kivley came on board. This is crucial information that is needed for the Board, the staff and outsiders in order to make good decisions.

These are normal monthly reports that the above readers have always received on a monthly basis. For two years these financial numbers are unknown. If they are known

(which I doubt) they are being hidden. What is the reason for not preparing them nor giving them to the parties listed above.

Someone on the Board needs to be responsible to make sure all Financial Reports are generated and distributed on a timely basis. No more excuses, blaming others, nor keeping these a secret. What is the secret????

I looked at Mike Wright and Marshall at the meeting last night and their faces were beet red throughout the meeting. Was it because they were totally embarrassed about the situation they have gotten themselves into.

So much drama has come to LOSOSOSCSD since they hiring of the current incompetent

and disrespectful General Manager.

None of this drama will be advantageous to the continuance of the District

It is always interesting to see how newspaper articles are taken as unqualified assurance of this or that having happened.

The Board is doing an investigation of what they feel is relevant. The town voters elected the Board and we will see what happens at the next election.

The District will continue.

BTW, a lot of people’s faces were red, I heard that it was very warm in the room. If you were there, you must have noticed. Perhaps yours was too.

So much drama has come to LOSOSOSCSD since they hiring of the current incompetent

and disrespectful General Manager.

I think you may have this wrong, there has been nothing but drama and problems since the CSD was formed years ago, this should have stopped years ago and the county should take over services once again.

The CSDs are under the jurisdiction of the state. LAFCo decides. An attempt to dissolve took place 2005-06. It required hundreds of signatures and a lot of money.

Lynette, I realize your strong commitment to the LOCSD, since your husband is on this miserable board. I am willing to “move forward” to lessen the community of this waste of money. What a wonderful thought that someday MY neighbors may awake and be rid of this horrible nightmare Pandora placed around our neck. The LOCSD has wasted over 35 MILLION dollars, for a “PIPE DREAM” of local creation. Next time you have drinks with Kathy and Pandora, you should really examine what has happened. Have a great day….

Jeeeeeez—-luweeeeeeeezzzzz Lighten up on the poor gal.

Think about what she inherited. A friggen nightmare for anyone to put together & make any sense of it.

Any business person that has been around anytime, that followed a bankruptcy, knows that the bookeeping part is a crazy-making nightmare and that honest mistakes are made unintentionally.

Get over it & let the community join together again & move forward.

You hold that thought, wolfhound. Ms. Kivley should NOT have been awarded a raise after just one (1) year of service – not until she had proved her worth and demonstrated that she did not carry her previous bad habits to her new position.

They should down much harder on the poor girl. The Board is letting her get away with issues that she should have been immediately terminated for.

Her previous employers did not put up with her lies, incompetency, poor behavior, etc.

She has such a nasty disposition how could you say lighten up.

Nobody is going to get over it until justice has been done. At this that is not happening.

It is very questionable why three members of the Board are not doing what they were elected to do. What is going on behind the scenes???

So many residents are so dumfounded by what is going on in Los Osos.

All of the issues need to be addressed.

This will not be over until she is not sitting in her seat at the Los Osos Community Services District.

There should be no lightening up!!!!!!!!

This is her personality to get away with as much as she can by continuous lies and bad behavior.


The investigation should include the reasons behind the bad audit, the payment of overtime to people working during business hours (2 discovered in just a small sample of 25 payroll checks), the budget the board only adopted because of the required deadline Sept. 1, the time spent playing online casino games during business hours and the biggie; affecting all Prohibition Zone property owners brought up by Jim Erb that the board got bad advice from Kivley and raised the 2001 assessment by $7 annually for “administrative” purposes…just to name a few other important issues facing the LOCSD.

And on and on. In the meantime, I suppose that Ms. Kivley is collecting her salary?

And it does not state who the ‘two’ will b e to chose an investigator. Any chance that is her buddy Wright and/or Seitz?

She should never have been hired. And then given $7000 to relocate! You have to be kidding


The LOCSD board voted in early December 2014 to give Ms. Kivley a $9K raise – this boosted Kivley’s salary from $90K to $99K. http://www.sanluisobispo.com/2014/12/11/3394685_los-osos-csd-manager-gets-9000.html?rh=1

While the board was at it, did they prepay for a Tesla Model X, for Ms. Kivley, too? Since the LOCSD board cannot be trusted with a general manager nor can a general manager be trusted with or by a board – better eliminate BOTH!

What! A Tesla?

Yes Ms. Kivley is collecting her salary. It has been proven that she has been playing casino slot games during her 8-5 work hours for almost 50% of the regular working day.

Not only is she collecting her salary but she is playing or gambling on the District time.

The three members of the Board do not seem to think that

there is anything wrong with it.

“…the board announced it agreed to hire an outside investigator and that two members of the board would lead the search for the individual.” Was the BOARD responsible for selecting/hiring Ms. Kivley? If so, WHY is the BOARD taking it upon itself to hire an independent investigator? Shouldn’t someone completely disassociated with this entire quagmire be tasked with selecting an nonpartisan analyst? “Thank you” [to whomever haphazardly hired Ms. Kivley] for bringing more hardship to the citizens of Los Osos! Independent investigators are probably just as pricey as attorneys. PREVENTION – PROACTIVE – CAREFUL CONSIDERATION — how ’bout THIS for a change?