What happened to ethics?

October 6, 2015
Kathy Kivley

Kathy Kivley


The Los Osos Community Service District does more disservice than service to our community. Now it appears its General Manager, Kathy Kively, has been serving up more to herself than she’s contractually allowed. This is self-service, over community service, is as much as I can take.

Ms. Kivley is orchestrating a series of blunders that include a shady audit, lining her own pockets and a fleecing of the districts water customers.

An example lies here, when a recent $150,000 interfund loan from the LOCSD water department’s Capital Outlay Reserve to the small subdivision of 147 parcels called “Bayridge Estates” which is entirely geographically disconnected from the districts water service area.

The district’s Capital Outlay Reserve balance is hovering at just about $550,000 and is all that has been set aside for water related projects for the necessary for basin plan implementation addressing seawater intrusion into our aquifers.

I object to the use of these funds (generated solely by LOCSD water customers) be used for any other purpose. This reserve fund is funded through water rate revenues and Bayridge Estates is not part of its revenue stream. The “loan” is for sewer collection system repairs that were likely needed as long ago as 1999 when the district was formed and took over its management from the county in anticipation of building sewer ponds in the middle of town. Sagging sewer pipe and root infestation is evidence of shifting sands and high groundwater that’s been going on for a long time.

The county has refused to take over the little sewer system until it is repaired.

More recently, additional repairs were found to be needed and the LOCSD has asked the county to help fund it. Ideally these repairs were to be done before the road resurfacing was done, as part of the community wide sewer project. Poor management has made that impossible, the roadwork is done. But, LOCSD finds itself between a rock and a hard place. Damned if they fix it (borrow from Peter to pay Paul) and damned if they don’t (the county won’t take it over as part of the LOWWP).

This is an additional half a million dollar mistake, put upon us by Director Mike Wright and Kivley. Mike Wright knew this was wrong but let Kivley proceed. There must be a much more personnel relationship here, one that has clouded this president of the boards judgement in not preventing this from moving forward. Or even to demand appropriate fiduciary oversight.

Worse yet, the citizens of Bayridge Estates, and all of Los Osos, are out of the loop as to what’s happening with these repairs and that the costs will be passed down over the next five to seven years as their current annual assessments of $373 for maintenance and repairs to their community septic system will continue until all this debt is repaid. The costs could climb to over $500,000, add in Kathy Kivley’s administrative draw and the number goes up and up.

On the 12 of October the board will be considering Kivley’s performance. My neighbors need to come forward and demand something more honest, transparent and forthright – Kivley must be terminated for cause, anything short of that won’t do.

Tom Salmon is a longtime Los Osos resident with 35 years of expertise in statewide public infrastructure.


She signed a contract that states that she is responsible for all activities of the agency including the Supervision of All Financial matters.

To date there is not a completed nor approved audit for 13/14. This document has a due date of 12/31/2014. It is almost one year later and no audit. When is it going to be completed and approved? Who knows? Should be on top priority shelve.

The Budget for 15/16 needs to re-done from top to bottom. This document was due to be completed on 06/30/2015. At this time there will be a mid-year budget report prepared, and soon the budget for the 16/17 year will be started.

If the District Manager is a year overdue on these unfinished documents, how is she going to produce both of them for this coming year documents on a timely basis? All past Financial documents are incomplete.

It sure looks like the District is trouble. Agencies cannot get behind on their Financial Reporting. Not knowing where the District stands is huge.

Also your current District Manager is a huge disappointment. NO SURPRISE


If this piece of the audit was to show all is well at the District. How crazy.

The MDA is so important to the District for the following reasons:

A section of a company’s annual report in which management discusses numerous aspects of the company, both past and present and is a requirement.

BREAKING DOWN ‘Management Discussion and Analysis – MD&A’

Among other things, the MD&A provides an overview of the previous year of operations and how the company fared in that time period. Management will usually also touch on the upcoming year, outlining future goals and approaches to new projects.

The MD&A is a very important section of an annual report, especially for those analyzing the fundamentals, which include management and management style.

Due to this information being missing from the audit just like the budget does not show how the District how the District handled the and all other issues during that audit year.

This section should contain information that the Board, FAC Committee and the should be aware of from the past and into the future. Omitting this section (that all agencies complete) leaves all readers up in the air. WHY? Is it because the GM is unable to complete accurately, she is the laziest person in the world, she is controlling and just wants to have her way again, or does she not want all of the readers to really know what is going on. The M D and A gives the District transparency. What is the District Manager hiding?????

It is advantageous for the District to have the M D and A included in the unfinished audit. Why would anyone leave it out???

There is no excuse for not having this required information.

As the audit states, it does not effect the numbers. What it does do is provide the very important information to the readers and other interested parties.

Numbers are not the only facet of an audit. This information is so important.

Again, what is the real reason for not completing this much needed portion of the audit.

The budget does not give any reader any idea of what the total agency or specific funds is doing financially. How does the Board where know where the District stands?? They do not.

If a reader wants to know for instance, how is the Water Fund doing? It cannot be found anywhere in the budget. A reserve statement for reserved and unrestricted fund balance for the past years and the future budget years needs to be prepared. The readers could easily see what the anticipated fund balances for both reserve and unreserved fund are. A budget is not just a list of revenues and expenditures.

It is where does the District stand now and what is projected for the future.

An example of the little experience the District Manager has in relation to Accounting,

She shows in the budget the expenditures first and then revenues second. Accounting 101 teaches that the revenues are always shown first and the expenditures come second. This is true with all Financial documents that are normally prepared.

She has no knowledge of Accounting and Finance. Above is just one of examples of her incompetency.

I hope everybody knows by now that she is incompetent at District as well as in all other agencies that she was employed by. The only difference is the knew enough to get rid of her.

She is controlling, does not know anything in regards to Accounting or Finance, is very dishonest, self absorbent, and a narcicist.

The most scariest thing about all of this, is I think she thinks she is right.

There is so much proof that she is not.



Glad to see that someone else tracked her record in Clearlake. Another omission on her par as she was fired there (as well as Atwater)

But out of curiosity has anyone else checked her Facebook page? There is a certain area where it asks for personal responses. Question is: What do you like? Kivley’s answer: Men.

After tracking her down, it seems she comes from a business family. Including real estate.

(her brother, I believe) Perhaps that would account for many of the address credited to her – much more that so far shown.

Who checks her usage of the credit card she was given? Is that money constantly renewed? Where does she travel that she needs a $400 monthly car allowance?

She couldn’t take the car to Ireland where she recently visited, could she?


Her past employment history tells all:

Her contract was not renewed purposely at the City of Delano

She was Fired for Financial Mismanagement from the City of Atwater leaving their General Fund 3.7 million in the red

She was fired from the City of Clearlake for Financial Mismanagement leaving their General Fund 1 million in the red and her replacement had to lay off many employees

If she gets fired from LOSOSOSCSD it will just the same as above

It is clear that Finance and Honesty are not her strong suits

Her employment application has no indications that she was previously fired

This right here is a cause for dismissal


Yes, I am sure a newspaper story tells it all, right? So how about this from October 2012:

“Atwater has a reported $95 million in debt from bondholders, and unemployment in the town is more than 10% higher than the national average. But unlike the previous three California bankruptcies, Atwater’s financial degradation is primarily based on unfunded redevelopment projects.

During a time when real estate was booming in the Golden State, cities like Atwater grew roots in redevelopment, and neglected other areas of long-term fiscal bedrock. Atwater then took a hit when the state stopped funding redevelopment projects to its cities. This left many California municipalities without a strong financial net after the real estate “bubble” burst and property taxes sank, Atwater included.”


Sounds like there was a problem before Kivley ever got there. City Councils, NOT General Managers vote to do stuff like this.


Lynette, why is this article any different than the others? Kivley wasn’t just fired by one community(Atwater), she has a horrible past from additional government agencies. These officials found multiple grieveious errors conducted by Kivley, it’s refered to as a “track record or M.O”. Mike Wright knew of these issues, but still paid here $7000 to move her and continue the failures. My concern now is Kivley will attempt to bring legal action on Los Osos, possibly stress or medical problems to receive a disability.

I still contend there is a very distasteful relationship between MIke Wright and Kivley against Los Osos. He was elected to represent Los Osos, took a oath to do that. Now the only one he seems to protect Kivley, that’s the “elephant in the room”.


Every Agency had the identical problems with the changes in the RDA program. They all fixed their problems and moved on.

RDA has nothing to do with her filling out an application for the position in Los Osos.

On her application she stated that she had not been fired from any agency. This is total fraud that enabled this incompetent women to obtain the job at the Losososcsd.

You are missing the point. She lied on her application. Dose the District want to employ an out and out liar? They have fir the past two years and it is all backfiring. Her incompetency is shining brightly in her totally incorrect Financial documents that she has been presenting to the Board.

There is no excuse for incorrect information that she put on her application.

Saying that the RDA problems at the City of Atwater caused her to lie is totally ridiculous.

She always talks a big game but cannot produce. She is unable to.

There is no excuse for her continual lies and for saying that she is Financially minded.

The RDA excuse that you indicate is just another dog ate my homework, it is somebodies else’s work that caused the errors, I left it on my table at home, I did not have the correct directions, I was out sick for a few days and could not get to it, employees in the past did not know what they were doing, etc. The only one that does not know what they are doing is the District Manager herself.

I am not surprised that she has an excuse or excuses for not marking the correct boxes on her application. That is how she operates. To see how far she can get by talking her way in and out of everything. Again, she talks but cannot produce.

Why Mike Wright is protecting her is mind boggling.


Was Mike Wright influenced by her Facebook page? When I told Mike about the horrible past of Kivley, I didn’t read her Facebook. Is it possible Mike wright saw something that he thought might work for the board…


The entire country has no ethics. We have fallen so fast, so hard, so far, that V Putin is in charge of what happens to many of our former allies. It pretty telling when your enemy looks like the hero.

Take what you can, because who knows how far down we could all go. More and more people are waking up to that very sad reality.


“Tom Salmon is a longtime Los Osos resident with 35 years of expertise in statewide public infrastructure.”

At least he isn’t claiming to be an engineer anymore like he did when he ran for office in 2002. I guess that makes me a worldwide expert on tobacco production with 49 years of experience.


Bendayho, I’m a active 35yr member of the engineers union. Designed and engineered many structures and systems. But you won’t sign your name, but call yourself dumb( Spanish Translation), how do I respond to that? Try and stay on topic, it’s about Kivley and the LOCSD. I realize that you have a hard time staying focused, but please try and just comment on the editorial… Have a nice day….


Will it never end?


What ethics? For at least a decade, ethics has NOT played a role in the governance of Los Osos. Moral turpitude has. So has lying under oath, breach of contract, enforcement actions, fines, waste, fraud and abuse of taxpayers money, and bankruptcy, just to name a few.

JB Bronson

One response to the question, “What happened to ethics?” is that, “that train left the local station some time ago.”

Not sure when exactly it departed and it wasn’t all at once, but if you don’t believe it, think of:

David Edge

Lisa Solomon

Jim App

Tony Ferrara

Steve Adams

Lee Collins

Tracy Schiro

Bruce Gibson

Adam Hill

Michael Blank

Dee Torres…

…add Kivley

It’s a culture now.


If you have ethics you end up getting fired. Look what happen to Lueker and Shultz. They tired to tell irons he was unethical and what he wanted to do was illegal and they got fired. Said state of affairs!


And the flip side… if don’t ethics, you get promoted. When you get promoted, you promote others who don’t have ethics. Welcome to the way things really are. I wish I could have my ethics surgically removed, as they have certainly killed my career.


Ethics in Government? Really?

Government employment is a license for mediocre men and women who cannot cut it in a real job to steal. Always has been. Always will be.