Cirrus calls it quits

Cirrus Health Group, the Texas company that bought the option on 22 acres on Eighth Street East and wanted to invest $100 million in a new Sonoma community hospital, along with an adjacent medical spa, has withdrawn its proposal after its latest overture to the hospital board rejected by a 2-2 vote Wednesday night.
“Cirrus is through; they’re done. They are removing themselves,” Henry Grause, the developer of the proposed medical spa, said Thursday.
A private-public “hybrid” option was put forth in a resolution made Wednesday by new hospital board member Bill Boerum. The proposed resolution would have directed Carl Gerlach, the hospital’s chief executive officer.
Gerlach identified a number of possible benefits from “a partner like Cirrus.” He also discussed several potential negatives of the proposed negotiations, including a delay in securing the land for the Broadway site and, especially, a big delay if the partnership option were selected but the UGB amendment was not approved by the City of Sonoma voters.
About a dozen people spoke Wednesday, mostly in favor of having the board negotiate with Cirrus.
Steve Kyle said that it was the board’s fiduciary responsibility, and if board members didn’t negotiate, “You will have done a disservice to the community.”
Citing bad experiences in their discussions earlier with Cirrus, hospital board members Mike Nugent and Arnie Riebli both voted against Boerum’s resolution.
“I’m going to vote no,” Riebli said, allowing that he was still “not opposed to listening to what they have to say.”
Nugent said, “I have heard so much legal argle-bargle from Cirrus.”
With Board member Mike Smith absent, those votes effectively killed that option, at least with Cirrus as the private partner. Both board chairman Dick Kirk and Nugent questioned Cirrus’ good faith, Nugent noting that “a political process in going on,” referring to the current petition drive for signatures to put the UGB amendment before the voters in the City of Sonoma.
“This could be a shot in the arm for that process,” Nugent said.
Grause said Thursday that, “Cirrus was rewarded for its largesse… by being maligned by the district board.”
Grause said that Cirrus was only 50 votes short of getting enough signatures put the its UGB proposal on the ballot in August.
Meanwhile, Cirrus opponent Larry Barnett said Thursday, “I am delighted to hear of Cirrus’ decision. It’s probably the best business decision they have made all year. The proposed UGB expansion would have gone down to a resounding defeat.”