Aurora hospital will proceed in Summit pending zoning deal

Milwaukee Business Journal, August 15, 2006

By Ben Fischer

The city of Oconomowoc and the town of Summit both approved a complex scheme Tuesday night that will pave the way for Aurora Health Care to finally build a hospital in fast-growing, affluent western Waukesha County.

Under the pending agreement, Aurora would finally get clearance to build a $166 million, 88-bed hospital just to the south of Interstate 94. The Milwaukee health care system could break ground before the end of the year.

The deal consists of a legal agreement between Aurora, the two municipalities and Pabst Farms Development Inc. Under its terms, the city would use a rarely invoked authority called "extraterritorial zoning" to rezone the building parcel within the town.

That move would allow the town of Summit to retain jurisdiction over the land. But because the actual rezoning act would be done by an incorporated city, it would not be subject to review by the Waukesha County Board. Last year, county supervisors rejected the town's first attempt to rezone the property to allow the hospital.

It's a rarely used tool, and both Oconomowoc Mayor Maury Sullivan and Summit Town Chairman Len Susa said they've never been directly involved with such an effort.

The rezoning plan drew widespread opposition from local business leaders and Oconomowoc residents at Tuesday's Oconomowoc Common Council meeting. Public speakers repeated long-held concerns that Aurora's proposal would unnecessarily duplicate services at Oconomowoc Memorial Hospital, in the process driving up prices.

The council approved the plan without opposition, and without debate.

In exchange for the deal, Aurora has agreed to drop its two pending lawsuits against the city of Oconomowoc and Waukesha County stemming from those two entities' original attempts to stop the project.

Aurora's deep pockets and perseverance were the reasons the city of Oconomowoc, which first moved to stop construction of the hospital within the city in 2001, changed its tune and began negotiating, Sullivan said Tuesday.

In May, a judge ruled that Oconomowoc acted improperly and could be forced to pay $59 million in damages to Aurora if it ultimately lost appeals.

"Setting aside the merits of that figure, the city has a fiduciary responsibility, and as such, I had great reluctance to roll the dice," Sullivan said.

Under the plan, the Aurora campus would be bordered by Interstate 94 to the north and east, Wisconsin Highway 67 to the west and Delafield Road to the south.

Finalizing the zoning deal could take up to four months, said Sullivan. The law calls for a six-member committee, including three representatives each from the city and the town, to work out the details.