.Watsonville Hospital Begins Operations Under New Ownership

Pajaro Valley Health Care District oversees operations after completing $67M purchase

Thursday marked the end of an era—and the beginning of a new one—as Watsonville Community Hospital officially became a public entity, to be controlled by a local board of elected representatives.

The purchase followed a months-long fundraising campaign—the largest in Santa Cruz County history—that netted donations from more than 450 people and organizations ranging from $5 to $7.5 million.

“This milestone illustrates what is possible when we all rally around a common cause and underscores how the people of the Pajaro Valley—and beyond—deeply care for this community,” says Pajaro Valley Healthcare District Board Vice Chair Jasmine Nájera. “The completion of the transaction represents an exciting step for the future of the Hospital, which is now well-positioned to meet the ongoing needs of the community and patients it serves.”

Late last year, the Pajaro Valley Health Care District Project (PVHDP) announced its intentions to purchase the hospital and place it under local leadership. That announcement came soon after hospital officials declared bankruptcy and said it was facing closure unless a buyer came forward.

The Project also found help along the way from Sen. John Laird and Assemblymember Robert Rivas, who led the creation of the Pajaro Valley Health Care District with Senate 418. The legislators also secured a $25 million appropriation from the state to support the purchase.

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With the sale, the hospital has successfully emerged from the Chapter 11 bankruptcy process.

In a short press conference at the hospital on Thursday, CEO Steven Salyer said that he saw the hospital’s dire financial picture when he joined in July 2021 under the previous owners. As bankruptcy approached, he says he met members of PVHDP, and realized he shared a vision of a nonprofit running the hospital.

“When I explained my vision to them they made it very clear that they had this vision for a long time,” he says.

One of his first orders of business, he says, is making sure WCH is paid the same as surrounding healthcare providers. The trouble, he says, is that the hospital is in the 25th percentile nationally in the amounts it receives.

“Everybody around us is getting paid more—a lot more—for the same types of services,” he says.

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