Two Elk Grove council members must abstain from hospital vote, ethics watchdog says

The Fair Political Practices Commission has recommended two Elk Grove council members abstain from public discussion of a controversial hospital project and recuse themselves from the vote on its land-use application.

The government watchdog suggested council members Darren Suen and Pat Hume not vote on the project because both have spouses who work at health systems that could compete with California Northstate University’s proposed medical center in Elk Grove.

City attorney Jon Hobbs requested the agency’s advice after issuing his own legal opinion concluding there was no conflict of interest for the council members. The FPPC disagreed in a four-page letter on Sept. 30 that said both Suen and Hume have a “source of income interest” in their wives’ employers.

Councilman Suen’s wife works in a lab at St. Joseph’s Medical Center in Stockton, which is a Dignity Health member facility. Councilman Hume’s wife is the director of healthcare philanthropy and works in a Sutter Health hospital in Modesto.

Dignity Health is building a hospital on Elk Grove Boulevard and Sutter Health does not have a hospital in the city, only medical offices.

Elk Grove officials said they were surprised by the agency’s conclusion in the “advice letter” and said there was no avenue to challenge the FPPC’s reasoning. That means if the current Elk Grove City Council remains in place after the Nov. 3 election, only three members will be able to weigh-in on the hospital project. At least three people are needed to hold a vote and the decision would have to be unanimous for approval.

“I think it’s a bit of a reach and probably errs — very conservatively — on the fact of an actual conflict of interest given what our wives do for the organizations and that they don’t even work in the Elk Grove area,” Hume said. “However, now that the FPPC has gone on record that this is their determination, it is only a recommendation, but you disregard it at your own peril, potentially.”

California Northstate University, a small for-profit school focused on health professions, wants to build a 12-story medical center that could be as large as 400 beds on the west side of Elk Grove. The plans, which include a helipad for trauma services, have become increasingly controversial as residents in nearby communities have been opposed to the project, citing environmental and other concerns.

The City Council will eventually vote on a land-use application for the hospital after an environmental impact review that’s still in the early stages.

‘We never thought there was a conflict’

Councilman Suen, who represents the area where the hospital is planned, said City Attorney Jon Hobbs did a legal assessment on potential conflicts of interests after a land-use attorney for the California Northstate project raised the issue. Hobbs’ report concluded there was no conflict and the city sent it to the FPPC for confirmation, he said.

“To our surprise, the FPPC made the opinion that not just me but also councilman Hume had the conflict,” Suen said. “It all started with CNU. We did not seek it out ourselves. We never thought there was a conflict.”

Suen said California Northstate first took issue when he hosted a virtual town hall about the Dignity Health hospital. The hospital also did one with Councilwoman Stephanie Nguyen, he said. What’s more, Suen previously did the same with California Northstate and tenants who might be displaced from a shopping center near the school’s proposed hospital site.

The advice letter leaves a key voice missing from the debate since Suen represents district one where residents have been the most vocal.

Suen said he believed the school targeted him because he did not wholeheartedly embrace the project. In recent months he held a series of town halls with different communities to learn more about how residents feel.

“I’ve always been objective. At the get-go, I stated my support of the concept but that there is a process involved and they have to go through the process,” Suen said. “Of course, I support good-paying jobs but that support isn’t unconditional. You have to talk to the community and address their concerns the best that you can in an honest attempt.”

In a prepared statement, CNU spokesperson Brian Holloway said the university never sought to remove any of the lawmakers from voting on the project, adding that including Hume was unexpected. He said the school approached Suen and the city attorney out of “an abundance of caution.”

“CNU accepted the City Attorney’s determination that there was no conflict and was unaware that the letter had been sent to the FPPC,” Holloway said. “Our interest is to ensure that there is a fair, equitable, and transparent process of consideration by the government agency overseeing approval of the CNUMC project.”

This story was originally published October 9, 2020 at 5:00 AM.