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After pressure by Gallahers, deal struck to use Sonoma County opioid settlement funds to build sober living homes
Brooke Ross, left, development and site acquisition specialist with Gallaher Companies and a Buckelew Programs board member, and Cindy Gallaher, founding partner of Gallaher Companies, at the proposed site of a residential treatment facility, along Doyle Park Drive, in Santa Rosa on Thursday, December 4, 2025. (Christopher Chung/The Press Democrat)
After teetering on the brink of collapse two months ago, a $7.7 million deal has been struck to provide Sonoma County with four new, sorely needed substance use recovery residences.
On Jan. 28, the county signed a funding agreement with Buckelew Programs, a nonprofit provider of mental health and substance use services across the North Bay. The county agreed to put up $3.87 million, drawn from its pool of California Opioid Settlement Funds, for the construction of up to four new supportive recovery sober living environments, or SLEs, with a total of 68 beds.
The deal came after significant pressure and public outcry from Bill and Cindy Gallaher, the founding couple behind one of the county’s most prominent development firms, who complained of legal red tape and bureaucratic delays and threatened to walk away from the project.
Under the unusual public-private partnership meant to leverage the public funds — a fraction of the county’s $43 million share from a landmark, nationwide lawsuit and settlement with drug companies behind some of the most addictive and deadly painkillers — Buckelew agreed to match the county’s commitment with its own $3.7 million, via a low-interest loan from Poppy Bank.
Bill Gallaher is founder and chairman of the bank, based in Santa Rosa. Gallaher Companies, the couple’s Windsor-based development firm, is poised to build Buckelew’s new sober living facilities at cost.
The couple has spearheaded in recent years the rescue and rebuilding of Athena House and Hope Village, a residential treatment center and transitional housing facility in Rincon Valley. Gallaher Companies also served as the developer in those projects.
Brooke Ross, a Gallaher acquisition specialist, who for months pushed for a breakthrough from her side, hailed the new project in December as an “incredible, innovative” partnership “to build something that will serve people for 40, 50, 60 years.”
The first two buildings will rise on what is now a vacant lot on Doyle Park Drive, off Sonoma Avenue. By mid-December the developer had finished the architectural drawings, site plans and landscape design for the SLEs, which it will deliver fully furnished.
Site of a proposed residential treatment facility by Buckelew Programs in partnership with Gallaher Companies and Poppy Bank in Santa Rosa on Thursday, December 4, 2025. (Christopher Chung/The Press Democrat)
But the deal was nearly sunk by sharp disagreements between Sonoma County and Poppy Bank.
Sometime in the fall, the county inserted language into the funding agreement that was a dealbreaker for the bank. That language called for a deed restriction and subordination clause that were so constraining, Ross said, that “no financial institution can lend on it.”
Poppy Bank and the Gallahers said the county was being overcautious, excessively risk-averse. The county, for its part, wanted the bank to shoulder more of that risk, in the unlikely event that Buckelew — now in its 56th year of operation — should go under.
Jennifer Solito, interim director of the Sonoma County Department of Health Services, co-sponsor with Face to Face of the International Overdose Awareness Day event in Santa Rosa on Aug. 31, 2024. (Abraham Fuentes/For The Press Democrat)
Yes, Buckelew is rock solid for now. However, noted Assistant Sonoma County Administrator Jennifer Solito, due to the current “federal funding environment” in Washington, D.C., “the situation is going to get tight” for many nonprofits.
“The risk is, we give Buckelew $4 million, and what if they go under in a year? We have no recourse to get those funds back.”
In that dire scenario, Solito said, “Poppy Bank would own the property, and could sell it, and then it’s not an SLE anymore.”
That could put the county on the hook “to pay back money we don’t have,” she said, “but it would also be a huge loss to the community.”
The need for addiction treatment facilities and sober living homes is pressing across the whole state, “but particularly in our community,” Solito said, “where we have high need, but we just don’t have the beds.”
Sonoma County faces “a public health emergency,” according to a statement from Buckelew Programs, “driven by rising overdose rates and limited access to treatment. In 2023, opioids were implicated in 80% of all overdoses, with fentanyl detected in 90% of those cases, contributing to 91 out of 131 overdose fatalities.”
The monitored SLEs that have now been funded, it said, “will provide structured, substance-free environments for residents, along with wraparound services and life skills development.”
Sonoma County health officials estimate that an average of 12 people die each month from overdoses, the third-highest rate among all nine Bay Area counties.
The Gallahers repeatedly questioned the county’s conservative approach to the financial agreement, with Cindy Gallaher pointing out that Buckelew, Gallaher Companies and Poppy Bank are “all known quantities.”
Sylvie De La Cruz, right, program director of Athena House and Hope Village shows a garden sign to Bill and Cindy Gallaher bearing their name during the Athena House and Hope Village open house in Santa Rosa, Thursday, June 27, 2024. (Christopher Chung / The Press Democrat)
Bill Gallaher vented his frustration in a biting Dec. 8 letter to the Board of Supervisors, arguing that the county’s conditions “make it unfeasible for any bank to loan under their terms.”
As a result of the county’s “intransigence” and “unwillingness to find a path forward” despite “the minuscule risk,” he continued, “we have reached the end of our willingness to engage in the never-ending, non-productive circular machinations thrown up to make this offer impossible to execute.”
Not long after Gallaher sent that philippic, and after The Press Democrat chronicled the stalemate on Dec. 13, the logjam was broken.
“We are pleased to report that we have reached agreement with the project partners,” county spokesperson Matt Brown wrote in an email two days before Christmas.
The agreement, he said, was “a win for all involved, especially for the community, which will get badly needed treatment beds.”
It took another five weeks for the parties to get from that verbal agreement to a written one.
In the end, the county relented, somewhat, settling for a deed restriction of eight years, down from the 30 years it had previously suggested.
Poppy Bank decided it could live with that scaled-down restriction, meaning that even if the bank acquired the facility, it would have to remain an SLE “or similar substance-abuse and opioid-allowable expense facility.
“This requires the bank to sell the property with this use restriction should Buckelew default in the first eight years,” Brown said.
The parties also agreed on a second deed of trust for years nine to 20, giving the county “first right of refusal” should Buckelew default during that time. In that case, Brown said, “The county could opt to take on the loan and facility and find an operator, or find an operator to also purchase and assume the loan.”
As Ross put it, “The county gave a little, and the bank gave a little.”
Despite the signed agreement, Cindy Gallaher and Ross were less than ebullient Thursday, as they discussed a recent email from a county official, copied to some two dozen people, Ross said, seeking to schedule a “kickoff meeting” for the project, and inviting “review” and “comment” from recipients, Gallaher lamented, “who have no knowledge of construction or lending.”
With an agreement reached, and a site purchased and already permitted by the city, they’re raring to go, hoping to break ground in early March.
Incessant plans for “multiple meetings with multiple people,” Gallaher said, will needlessly slow the process.
“I mean, the reason (Gallaher Companies) can do it as efficiently — in cost and time — is that we don’t meet all the time.
“Kickoff meeting? The ball has already been kicked off. We’re running.”
While some friction surely lies ahead, the deal is done.
“The agreement has been executed,” said Solito, who expressed appreciation for this “rare” opportunity to work with “a private partner that’s willing to sort of deal with our bureaucracy, and make it work.
“I’m hoping this might be a model for other projects in the future.”
You can reach Staff Writer Austin Murphy at [email protected] or on Twitter @ausmurph88.
