Is it plagiarism for my thesis advisor to publish a paper using content from my thesis without citation?
Whether or not the department holds the copyright to your thesis is irrelevant. Using someone else's ideas without appropriate attribution is plagiarism, period.

So, if your advisor used your original, non-trivial scientific ideas (or your non-trivial description of those ideas) in his paper without attributing them to you, then he has committed misconduct.

The only thing that may be questionable is whether or not your original intellectual ideas were actually used in the paper. What you describe definitely sounds pretty damning, and the more information you add, the worse it sounds; but as strangers on the Internet, we don't have the whole story.

For example: Given that the idea for the thesis was the advisor's, and the paper describes a non-trivial extension, it's possible (though perhaps not likely, depending on the scope of the work) that your advisor was working on the extended version himself independently of your thesis.

It's also possible that he considers your work to be a straightforward implementation of his idea, and not an intellectual contribution - that is, he believes you were doing the work of a staff programmer, not a scientist or engineer. In which case, an acknowledgement would probably have been appropriate, but it's not necessarily plagiarism to omit it.

The degree to which your work constitutes an intellectual contribution to your advisor's paper is impossible for strangers on the Internet to judge. 

I suggest you email your former thesis advisor, tell him you've seen the paper, and ask (in a non-confrontational way) how it relates to your thesis work. Then decide how to proceed from there.

Note that pursuing the matter beyond that (i.e. formally accusing him of plagiarism) may involve some serious negative consequences for you, so consider this carefully before proceeding. The morally just course of action may or may not actually be in your best interests.