Reynolds quit Hayle a few weeks ago, citing work commitments and subsequently the Trevassack Park club pulled out of Carlsberg SWPL Division One West.
But now he has accepted City manager Steve Massey's invitation to return to the game as manager of the club's second team in place of Pascoe.
Massey said: "Gary has done a magnificent job and last season held the team together making sure we put a team out every week in difficult circumstances.
"But I just felt it was not going in the direction I wanted.
City Alerts Monday 22nd July:
2nd Team Manager Appointment
I am delighted to announce that Anthony Reynolds former Hayle manager for the past three years has been appointed Manager of our 2nd Team with immediate effect. Anthony comes with a wealth of experience and has the quality, drive and ambition to take the team to the very top of the League whilst playing an integral part of supporting our 1st Team in the quest of reaching Conference Premier League status. Anthony’s first match in charge will be against Saltash on Tuesday evening at Treyew Road.