A long-running dispute over water deliveries to the Diablo Grande community in western Stanislaus County escalated again this month, as the Kern County Water Agency said negotiations with the community’s water provider have stalled over a $14 million debt. In a recent letter, the agency said it had proposed “certain financial adjustments in an attempt to significantly reduce Western Hills’ outstanding $14M financial obligation,” and offered to modify water purchase volumes to better align with the community’s demand. The agency said Western Hills Water District declined those proposals and instead requested payment terms “substantially below” the agency’s actual cost of delivering water.