Sonoma County judge finds hospital districts had no standing to sue

SANTA ROSA – Sutter Health can continue construction unabated on its $284 million hospital after a Sonoma County judge last week dismissed most of the challenges filed by opponents that centered on project’s environmental impact report.

The North Sonoma County Healthcare District, which oversees Healdsburg District Hospital, led a group of opposition that included the Palm Drive Healthcare District, the California Nurses Association and the San Rafael group Transportation Solutions.

They argued that Sutter’s new hospital — meant to replace the existing and seismically unfit Chanate facility and scheduled to open late 2014 — was not in line with the California Environmental Quality Act and therefore challenged the county’s certification of the project environmental impact report.

But Superior Court Judge Rene Chouteau, in a 12-page ruling, said the lead parties – the two health care districts – did not have legal standing to bring an environmental challenge. He also sided with all but a few elements of the EIR approved by the county last year.

"It's a ruling that we see is very supportive of the county, and we're excited that the hospital will move forward uninterrupted," said Mike Purvis, chief administrative officer of Sutter Medical Center of Santa Rosa.

Evan Rayner, chief executive officer of Healdsburg District Hospital, said it was too soon to say how the district would respond to the ruling.

"Our attorneys have acknowledged receipt of the court’s statement of decision, which found certain defects in the county’s review process," Mr. Rayner said in a statement. "They’re now in the process of analyzing the court’s decision, and it would be inappropriate for me or us to speculate on any aspect of the decision until attorneys have had adequate time to make their evaluations and recommendations."

While siding with Sutter’s final EIR, the judge ordered the Board of Supervisors to reconsider some mitigation efforts and whether further measures should be adopted. He also asked the board to clarify whether an 80,000-square-foot medical office building that will be part of the campus would be owned or operated by a government agency.

Sally McGough, deputy county counsel, said those issues are relatively minor and that the county should have the matters clarified within the next 90 days.

“In the EIR, we did not take into account that [the impact of greenhouse gas emissions] was moving from one location to another,” Ms. McGough said. “The board took into account of the fact that, in reality, the old hospital will close, so these emissions are not new. I think what [the judge] wants is the statement of overriding consideration to match the full emissions in the EIR that were not considered.”

“It’s not a big item,” she added. “He did not set aside the EIR and did not require additional analysis.”

Regarding the medical office building, Sutter owns the property and has said it may sell or lease the building to a private developer but would maintain ownership of the property, which Ms. McGough said is consistent with the county’s General Plan.

The suing parties did not ask for a restraining order in the case, Ms. McGough said.

Mr. Purvis said Sutter, while pleased with the ruling, found it disappointing that the suit was brought on in the first place.

"The competing hospitals had no legal standing, which is most unfortunate because they are taxpayer-funded hospitals," Mr. Purivis said."We really feel it's unfortunate that these small hospitals went out of their way to use taxpayer money in this fashion."

Both the Board of Supervisors and the county Health and Human Services Department signed off on the hospital plan, which calls for an 82-bed hospital on a 25-acre parcel next to the Wells Fargo Center for the Arts. The hospital possibly could expand by 27 beds.

Sutter did not dispute the California Nurses Association's or the Transportation Solutions' standing to file suit, according to the ruling. But the suit was filed by the North Sonoma County Healthcare District last September.

The judge ruled that opponents did not exhaust their "administrative remedies" in challenging the county's approval, essentially meaning they failed to raise the issues before a deadline.  Specifically, five of the seven issues raised by the filing parties were made after public comment period had closed on the issue, thus rendering them moot. Those issues included consistency with the county General Plan, inadequate consideration of alternatives, improper narrowing of the project description, greenhouse-gas analysis and an unclear project description.

Opponents had also contended the new hospital could negatively impact the delivery of health care throughout the county, possibly resulting in the closure of district hospitals, which would be a violation of the 1996 county Health Care Access Agreement. That agreement stems from Sutter taking over operations at the current Chanate facility from the county.

The judge did not address this matter specifically. He did write that the health care districts are "competitors of Sutter hospital acting for economic and competitive purposes," and therefore don't have standing to bring the suit.

Mr. Purvis said the county was ultimately vindicated in approving Sutter's plan.

"I think it's really the county that deserves the recognition," he said. "Sutter went the extra mile to address all the issues and the collaborative work done there was on target."