Morgan Memorial Hospital

The former Morgan Memorial Hospital property, located at 1077 South Main Street in Madison, is at the center of a new lawsuit launched by the Morgan Medical Center Hospital Authority against the City of Madison over a zoning dispute concerning a proposed drug rehab facility.

A lawsuit is underway as Morgan Medical Center launches a legal battle to supersede the City of Madison’s zoning ruling in order to sell the old hospital property to an upscale drug rehabilitation company.

The Morgan Medical Center Hospital Authority is moving forward with the lawsuit against the City of Madison, asking the courts to clarify the parameters of the city’s zoning ordinances in hopes of selling the old Morgan Memorial Hospital property to Flashpoint Recovery to transform the old hospital into a resort-like drug rehab.

The dispute centers around the city’s zoning ordinance and whether or not a drug rehabilitation hospital can operate out of the old Morgan Memorial Hospital building without a zoning change or conditional use permit.

“More than two years after first approaching Madison city officials regarding the zoning of the former Morgan Memorial Hospital site, the Morgan County Hospital Authority will be filing an action asking the Court to issue a ruling interpreting the zoning laws governing the use of the property,” said an MMC press release. “If granted, the ruling could pave the way for the sale of the site to Flashpoint Recovery, an upscale drug rehabilitation hospital that will bring new jobs and significant economic impact to Madison.”

MMC had threatened to file such a lawsuit months ago when the Madison Mayor and City Council declined to issue a certification letter requested by the Hospital Authority and Flashpoint Recovery to preemptively approve the use of a drug rehabilitation facility at the site of the old Morgan Memorial Hospital at 1077 South Main Street in Madison.

Madison Mayor Fred Perriman indicated that the city would not rollover in the face of a lawsuit.

“The city would vigorously oppose such a lawsuit,” warned Perriman.

However, hospital authority leaders believe legal recourse is their only option left in the matter.

“While we regret this action has become necessary, we’re hopeful it will provide the clarity needed to move forward. After more than two years of back and forth with no progress, we can’t continue to stand idly by and lose yet another opportunity because the city refuses to act,” said Morgan County Hospital Authority Chairman John Moore. “Continuing to spend taxpayer dollars to maintain an aging, underutilized property just doesn’t make sense – especially when we have a responsible buyer ready to make significant investments that will benefit our community.”

The Hospital Authority says that a drug rehab is a legitimate and proper use under the current zoning. “Madison’s zoning ordinance allows the Hospital Authority to transfer the property and allow a new owner to continue a hospital use. Madison has issued a letter agreeing that a rehabilitation facility is a hospital use. Unfortunately, the city contradicted this statement in that same letter, making the zoning letter too confusing to utilize,” said the press release from MMC. “Despite these facts and the Hospital Authority’s repeated attempts to address city officials’ concerns, the city has refused to issue a corrected zoning letter that would allow the sale to move forward.”

City officials beg to differ, arguing that the hospital must go through zoning procedures before a drug rehab can be approved.

According to Perriman, the Hospital Authority and the prospective buyer, Mitch Baumann of Flashpoint Recovery, want to bypass the city’s zoning process by pressing city leaders to issue a “certification letter” declaring a drug rehabilitation hospital an automatic allowable use for the property.

The Hospital Authority believes they have a legal right to automatically transfer the “non-conforming use,” which allowed the old hospital to operate in the city’s P1 zone, to a drug rehabilitation hospital, claiming it is a “continuation” since some drug rehabilitation treatment was conducted at the old hospital.

But city leaders aren’t so sure.

“Is stabilizing patients and transferring them out for further drug treatment the same use as inpatient drug rehabilitation?” asked a skeptical Perriman. “The city again disagrees with that argument for the reason that there is no evidence that Morgan Memorial conducted in-house drug rehabilitation at the old hospital.”

Perriman said the city would not compromise its zoning process at the behest of a prospective buyer who is “unwilling to comply” with the city’s regulations and standards.

“Based on the law and the facts as we understand them, the mayor and council believe that a drug rehabilitation hospital in P1 would require either a zoning change or a conditional use permit,” said Perriman. “We believe we owe it to our citizens to defend our right to have public input on whether or not to allow a drug rehabilitation hospital to operate in the P1 district.”

MMC leaders dispute this characterization.

“It’s disappointing the city has chosen to create the false narrative that the Hospital Authority is doing ‘an end around’ to circumvent zoning laws. This could not be further from the truth,” said Sarah Burbach, vice chair of the Morgan Medical Center Hospital Authority. “From our very first outreach more than two years ago, we have approached our discussions with the city in good faith and with a strong desire to do the right thing for our community. We are hopeful the court’s decision will allow the sale to move forward in a way that benefits taxpayers and protects the interests of those who live nearby.”

MMC is standing by Flashpoint Recovery, arguing that the luxury drug rehab facility would be a welcomed addition to Madison’s tax base and to the community as a whole.

“A prospective buyer, Flashpoint Recovery, will make new investments in the hospital to deliver medical services that have historically been provided there. Morgan Memorial provided inpatient drug rehabilitation as a core service in the 1990s with the majority of its beds used to provide these services to Medicaid patients. More recently, the hospital has cared for an average of 450 patients a year with a drug or alcohol diagnosis,” said the MMC press release. “Flashpoint Recovery would provide inpatient drug and alcohol rehabilitation services to high-net-worth individuals voluntarily seeking care. Treatment costs are expected to range from $30,000 to $40,000 per patient, per month.”

MMC points to the hefty financial investment into the old Morgan Memorial Hospital property that will revitalize the building and ultimately improve the city.

“Flashpoint Recovery has committed to investing $3 million to make renovations and additions to the facility. Flashpoint has also agreed to work with the city to develop reasonable but effective requirements for the future sale of the building to ensure continued community friendly use,” said the MMC press release. “Unlike the hospital, Flashpoint Recovery will not be serviced by ambulances or operate an ER that draws traffic at all hours of the day and night. Patients will remain on campus for the duration of their treatment, minimizing traffic and noise in the area. Flashpoint’s purchase promises a safer and more attractive alternative for our community.”

Now, the city and the hospital will have to make their case for the courts to decide. This is a developing story. Follow the Morgan County Citizen at or the Morgan County Citizen Facebook page to read updates as they unfold.

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