Water district's subsidized deliveries to Diablo Grande to be halted over unpaid debt, agency says
The Kern County Water Agency says it can no longer subsidize water deliveries to Western Hills Water District, which supplies water to Diablo Grande in Stanislaus County, citing years of unpaid bills and failed negotiations that it says have left the agency with no option but to protect its own ratepayers.
In a statement released this week, the agency said it has spent more than six years working with Western Hills to address ongoing water supply and financial problems affecting the Diablo Grande community in western Stanislaus County. During that time, the agency said, Western Hills continued receiving water at no cost, with catch-up payments beginning only in recent months.
The water agency said officials have held repeated meetings and negotiations with Western Hills over the past year to find solutions that would allow continued water deliveries while accounting for the district's financial condition.
Those efforts included proposals to better align water purchases with Diablo Grande's actual community demand. The agency also said it offered financial adjustments intended to significantly reduce Western Hills' outstanding $14 million obligation for past water deliveries.
Despite those proposals, the Kern County Water Agency said Western Hills declined the adjustments and instead requested that the agency accept payments at levels significantly below the actual cost of delivering water.
The agency said it could not agree to any arrangement that would require it to provide water at a loss or shift the financial burden to its own ratepayers or onto other public agencies.
The water agency's statement comes months after nearly 200 households in Diablo Grande received water shutoff notices after Western Hills raised monthly water rates to more than $600. Residents who spoke with CBS News Sacramento in November said they were being penalized for the district's own financial decisions, while Western Hills has maintained it was following state law.
"We recently read how Western Hills issued shut-off notices to certain residents for non-payment after 60 days and indicated they were following state law in doing so," said Gene Lundquist, Kern County Water Agency board member. "They are over six years behind on payments to the Agency and we have a fiduciary responsibility to those we represent. We are no longer able to provide water at no cost and must act to protect the interests of our constituents in Kern County."
The temporary agreement allowing Kern County to continue supplying water to Western Hills was set to expire at the end of 2025, but a November vote allowed for a three-month extension, allowing the agency to continue supplying Western Hills through March 31, 2026. The agency said another recent extension had pushed that day back to May 31.
Though the Kern County Water Agency said it could no longer deliver water to Western Hills, it was not immediately clear if that meant service would stop at that May 31 deadline or anytime sooner.
The Western District Board of Directors also passed a resolution in November that authorized a Chapter 9 bankruptcy filing.
