Former manager Tom Geaslen has reimbursed the district $36,962 as stipulated in the agreement, board member Matthew Guerrero said.
The reason for the reimbursement was not disclosed in the agreement, and the document states that neither district officials nor Geaslen will discuss the disputes between them, or make any disparaging remarks or comments about the other.
The board voted 4-0 during a special meeting Thursday, with board member Karen White absent, to approve the final settlement agreement.
Geaslen started with the district as an interim general manager in June 2011, and in March 2012 was made a permanent employee at a base salary of $126,000 a year.
He had replaced previous general manager Raffaele Montemurro, who was hired in October 2009 as the districts fifth general manager in four years, including two interim managers. Montemurro was dismissed without cause May 31, 2011.
The board will hold a special meeting Monday morning to discuss appointing an interim manager to serve until a permanent replacement can be found, Guerrero said. He said its likely the district board will choose a current employee to temporarily fill the position.
The board on Wednesday approved a new job description and plans to expand its search for a permanent manager throughout California, with the salary to be set depending on experience.
Guerrero said he hopes the district can hire someone in June to start at the services district July 1. It provides water, sewer, fire protection and street lighting services to more than 7,200 people in the South County community.