Los Osos CSD parts ways with its general manager

January 8, 2016
Kathy Kivley

Kathy Kivley

Embattled Los Osos Community Services District general manager Kathy Kivley will retire at the end of January, following a settlement she reached with the CSD board. The district board decided to part ways with, but not fire Kivley after an investigation into district funds she allegedly misappropriated.

Following a closed session hearing Thursday, district counsel Mike Seitz announced Kivley will remain on administrative leave until her retirement on Jan. 31. Seitz said the terms of the settlement are confidential, but both Kivley and the district agreed not to sue one another.

In October, the district board hired private investigator Jim Gardiner to examine allegations that Kivley misappropriated district funds. The investigation followed a CalCoastNews analysis which found Kivley had been collecting pay for more administrative leave days than her contract allowed. She had also been receiving more holiday pay than her contract permits, according to district payroll documents.

On Thursday, the district board approved a $5,000 payment to Gardiner for the investigation. The district has not disclosed Gardiner’s findings.

In addition to the allegations of misappropriation of funds, a recent audit of the district found Kivley engaged in questionable accounting practices during her first year on the job. In response to the audit, San Luis Obispo County auditor Jim Erb sent a letter to Los Osos board members saying the findings should be of great concern to them.

Kivley has been on administrative leave since Dec. 4. Kivley’s contract states she is eligible for a two-month severance package if she is fired without cause. By spending most of December and January on administrative leave, Kivley is receiving approximately the same amount of pay she would have been owed if the board let her go without cause.

During public comment at Thursday’s meeting, most speakers called for the board to fire her with cause.

The Los Osos board hired Kivley in 2013 after she falsely stated on her job application that she had never been terminated. Kivley was previously fired from the positions of Atwater city manager and Clearlake city administrator, according to media reports.

The board appointed utility manager Margaret Falkner as interim general manager. The board has yet to discuss the hiring process for a new full time general manager.


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35 Comments

  1. MaryMalone says:

    It is my opinion that local governments (i.e., CSDs) and their employees/contractors usually keep their termination dealings confidential because the local government is afraid the terminated employee knows enough, just by working at the the CSD to bring trouble to the CSD’s board of directors.

    (8) 12 Total Votes - 10 up - 2 down
    • SLO_Johnny says:

      It has more to do with California law that provides employees with complete privacy unless they’re charged and convicted of committing a crime on the job. Even then, they get to keep their pensions and benefits. We work to support them. They don’t work for us.

      (10) 12 Total Votes - 11 up - 1 down
  2. PacoFR says:

    The reason Mr. Seitz will not give the agreement to the public because he and Mike Wright and Marshall are so embarrassed. They have been had.

    (10) 14 Total Votes - 12 up - 2 down
    • agag1 says:

      Among the list of AG Mayor Jim Hill’s accomplishments this past year–leading the charge for removing Seitz as longtime counsel at the SSLOCSD.
      These things take a while, but maybe other entities will begin to see Seitz for what he really is, and make the bold move for ousting him as well.
      The SSLOCSD sure doesn’t miss him.

      (11) 17 Total Votes - 14 up - 3 down
  3. PacoFR says:

    LYNETTE HOW BIG ARE YOUR BLINDERS
    YOU ARE THE STUPEDESS WOMAN I HAVE EVER SEEN.
    ALL OF THE COMMENTS ABOVE ARE SO TRUE. KATHY KIVLEY HAS BEEN DISHONEST, A BIG LIAR AND BIG FARCE ALL OF HER LIFE.
    SHE TALKS HER WAY IN AND OUT OF EVERYTHING. SHE SURE HAS YOU
    BUFFALOED. SHE TALKS TO YOU BECAUSE YOU WILL LISTEN WHEN NO
    ONE ELSE WILL.

    YOU ARE HER OWNLY ALLY.

    (7) 13 Total Votes - 10 up - 3 down
    • Pelican1 says:

      With speeling like that, you shood apply for LOCSD manager.

      (13) 13 Total Votes - 13 up - 0 down
    • SLOBIRD says:

      What do you expect from Lynette? She thinks Bruce Gilbson as the nove knowledgeable, honest, and best public servant in the County. She obviously has no insight or taste for good vs bad, good vs evil, stupid vs ignorant…She and Lou maybe should return to Southern California.

      (8) 12 Total Votes - 10 up - 2 down
    • SanSimeonSam says:

      Or run against adam hill. Intellectual equals

      (2) 2 Total Votes - 2 up - 0 down
  4. shudacuda says:

    Why am I not surprised at the decision to compensate (reward) her and let her go on her merry way. If I worked at a bank and embezzled funds and got caught, do you think they would say ” go ahead and keep the money you stole, just don’t come back here again and we’ll call it good “.A thief is a thief, there should be criminal charges instead of compensation. I suppose it’s probably cheaper to just cut bait, but it just feels wrong.The saga continues.

    (20) 26 Total Votes - 23 up - 3 down
    • kayaknut says:

      Why not give her even more money even after she stole a large sum, the boards, as with most governmental bodies do not see it as real money or that they are held personally responsible, it won’t come of out their budgets, for the funds, and they feel they can always milk more out of the rate/tax payers when needed

      (9) 11 Total Votes - 10 up - 1 down
  5. justbeware says:

    It is apparent her previous employers were more than happy to see her go.
    Likewise, Los OSOS will be happy to see her go.
    She will be able to claim she was not fired.
    When her next unsuspecting potential employer checks her references, Los Osos can not be honest and say she’s a POS, thief, and liar–they will give the very minimum of info, anything to avoid her coming back to sue. They must protect themselves and limit their exposure.
    Thus, this POS, liar and cheat will essentially be a can who gets kicked down the road and the cycle will be repeated.
    I think this is exactly how Dianne Thompson came to be in Arroyo Grande.
    These public sector employees just keep circling the bowl and taxpayers get to keep cleaning the toilet.

    (27) 39 Total Votes - 33 up - 6 down
  6. TWEEKSBALMER says:

    Lets just disband the CSD we have proven we can’t handle our affairs (no offense Mr Hill and Mr Gibson) the county has to be better than our chosen leaders.

    (28) 32 Total Votes - 30 up - 2 down
    • falconbh says:

      When we look at Community manService Districts, like Los Osos, Oceano, etc.
      We see a historical pattern of board-management failure and financial mismanagement.

      (11) 13 Total Votes - 12 up - 1 down
  7. JB Bronson says:

    Same MO allowing Michael Blank to resign after 28 years with CRLA for “discrepancies” in his billing.

    Deceit, hypocrisy, entitlement at the expense of others…just some of the outstanding character qualities of these fine narcissists.

    (20) 28 Total Votes - 24 up - 4 down
  8. SLO_Johnny says:

    Once again, the taxpayers get cheated and then we have to pay that person to go away. It’s all too easy for government employees to get away with malfeasance, misconduct, or incompetence. They don’t work for us, we work for them. Then we pay the bill.

    (22) 36 Total Votes - 29 up - 7 down

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