George Washington University said this week that the university opposes a contentious proposal to build a new 270-bed tower at its affiliated Foggy Bottom hospital, potentially jeopardizing a deal struck between George Washington University Hospital and the District that would finance a long sought new hospital in Ward 8.

The decision now casts uncertainty over a deal brokered by the Muriel Bowser administration and GW Hospital, aimed at bringing a new hospital east of the Anacostia River, days before a crucial final vote in the D.C. Council that would accelerate the building of both projects. During negotiations, GW Hospital repeatedly asserted that it needed revenue from the new tower of beds at Foggy Bottom in order to make it financially viable to operate a new hospital in Ward 8, which it hopes to open in 2023.

The District still hopes to move forward with GW Hospital managing the new planned facility in Ward 8.

“Based on our discussions, we do not believe the concerns raised are a setback to securing a final agreement with all parties,” Interim Deputy Mayor for Health and Human Services Wayne Turnage said in a statement to City Paper. “We are confident that GW University and GW Hospital are committed to working together to address the service expansions needed to support a larger, integrated network of care that includes a new hospital east of the river.”

The unexpected twist lays bare differences between the university, which owns the land where the Foggy Bottom addition was slated to go, and GW Hospital, a separate entity that is mostly owned by a subsidiary of Universal Health Services Inc.

“We have concluded that a new bed tower on our Foggy Bottom campus is not a strategic priority for the University,” Mark Diaz, executive vice president and chief financial officer at GW, wrote in a letter on Monday.

“Accordingly, we are not supportive of its construction on our Foggy Bottom campus,” Diaz said in the letter, addressed to the chair of Advisory Neighborhood Commission 2A.

Before Monday’s letter, the university had not publicly commented on the proposed tower. In a statement to City Paper, GW Hospital CEO Kimberly Russosaid the university was fully aware of the hospital’s deal with the District.

“The University has been aware of and in agreement that our commitment to manage the East End Hospital was tied to the bed expansion at Foggy Bottom,” Russo said. “In addition, they participated in numerous discussions for months, with all parties clearly understanding this condition.”

ANC 2A and other Foggy Bottom community groups applauded the university’s move. They opposed the new tower, bringing up concerns about density and further congestion. In addition, they opposed a D.C. Council bill that would allow the project to circumvent an independent regulatory process that would determine whether the addition is needed.

GW Hospital also faced opposition from Ward 2 Councilmember Jack Evansand community leaders over the new tower in Foggy Bottom. The Bowser administration and the hospital say the facility is operating over capacity.

Criticism grew louder when the D.C. Council advanced a bill earlier this month to accelerate the construction of both the new tower and a new 150-bed Ward 8 hospital. Authored by Ward 7 Councilmember Vincent Gray, the bill waives the Certificate of Need process for the projects, a months-long study that examines all proposals from health service providers. After winning initial approval Nov. 13, the bill is set for a final vote on Dec. 4. Gray has made bringing new health care services to Wards 7 and 8 a priority and argues the waiver is needed in order to open the Ward 8 hospital sooner.

Gray’s office did not return a request for comment in time for publication. A top aide speaking on background said “As long as GW is still in the game to make sure that [the Ward 8] hospital is still built and operated, I don’t think we have any issues.” It was unclear whether the GW the aide referred to was the university or the hospital.

Diaz wrote in his letter that the university still supported building the new hospital in Ward 8. But it is unclear how GW Hospital will now finance operating the Ward 8 hospital, because the additional revenue from the new tower of beds at Foggy Bottom was projected to fund its management, as Russotestified to the D.C. Council in November.

“If we’re unable to expand [in Foggy Bottom], we will not be able to be that preferred partner” for the Ward 8 hospital, Russo told councilmembers on Nov. 1.

The university affirmed its stance in a statement to City Paper on Thursday. “The university is supportive of the East End project and hopes that it will continue to move forward,” university spokesperson Lindsay Hamilton said. “As we have said from the beginning, if the GW Medical Faculty Associates (MFA) physicians are properly compensated, we want to be part of that effort. However, the university does not support the construction of an additional bed tower on the Foggy Bottom campus.”