A Gig Harbor-based substance-abuse treatment provider’s effort to obtain a necessary license from Washington state has hit a roadblock.
The Department of Health recently issued a notice of intent to deny Peninsula Counseling’s application to be credentialed as a behavioral health agency, citing the alleged involvement of a man who previously ran three recovery centers in Pierce County accused by the state of putting patient safety in immediate jeopardy.
In the state’s Oct. 15 notice, it’s alleged that former Rainier Recovery CEO Jeremiah Dunlap was listed by the Department of Labor & Industries as the owner of Peninsula Counseling and involved in its day-to-day operations, such as hiring staff, submitting insurance reimbursements and establishing facility procedures.
The Department of Health decided to deny Peninsula Counseling’s license application under state codes that allow for such decisions when an agency owner has a history of noncompliance with state or federal rules and when a business stops providing services for which it’s certified.
In an interview Monday, Dunlap said he sold Peninsula Counseling several months ago, moved out of the state and no longer works in the industry. As he had before, Dunlap denied the allegations against him and Rainier Recovery, which he said he also sold sometime after a settlement with the state in December 2024 that enabled the centers in Lakewood, Gig Harbor and Puyallup to continue operating on probation for at least a decade.
“The Department of Health is lazy,” Dunlap said. “They don’t look for facts or evidence or anything.”
Department of Health spokesperson Frank Ameduri said the agency couldn’t provide details beyond what were contained within its notice last month or in prior documents related to Rainier Recovery’s alleged violations.
Secretary of State business records show Sherilyn Finlayson, as of May, is the named CEO of Peninsula Counseling, which shares the same address as Rainier Recovery’s former site in Gig Harbor.
“The Department of Health’s core allegation — that the previous owner remains the owner and is involved in day-to-day operations — is factually baseless and is the result of a negligent investigative process,” Finlayson said in a statement Tuesday to The News Tribune. “I, Sherilyn Finlayson, am the sole owner and operator of Peninsula Counseling, LLC, having purchased the agency from the previous ownership in May 2025. I serve as the agency’s primary counselor.”
Peninsula Counseling previously had a Behavioral Health Agency license, although it expired in February 2024, according to the state health department. The facility dissolved between approximately November 2024 and January and then submitted a renewal application on Jan. 15.
In back-to-back site visits in May, a Department of Health investigator learned of Dunlap’s involvement, according to the department’s notice.
“The DOH’s finding that the former owner was involved stems from an investigator who spoke to a receptionist during the transition of ownership,” Finlayson said. “During the transition period, the previous owner was available for consultations as needed.”
Peninsula Counseling had 28 days to respond to the state’s allegations, according to an Oct. 30 news release from the Department of Health.
“I have since filed for an appeal and will continue to fully cooperate with the WA State DOH in our effort to reinstate our certification under this new administration,” Finlayson said. “As a governing entity, the Department of Health, in my opinion, has failed not only me as a treatment provider, but many individuals making efforts to save their lives and overcome the grips of addiction.”
The month before reaching an agreement with the state, Rainier Recovery had its licenses suspended following a Department of Health investigation that alleged the facilities altered patient records to maximize profits and minimize court scrutiny on court-ordered patients. Company management was accused of “corrupt practices,” including colluding with an unnamed law firm to assure clients met sobriety requirements in exchange for continued business from the firm.
Rainier Recovery was also accused of employing unqualified staff, which allegedly led to “an excessive pattern” of substandard care and one patient later dying from acute intoxication with fentanyl, according to the Department of Health.
In the interview Monday, Dunlap asserted that the allegations were never founded. The settlement, which was explicitly not an admission of wrongdoing, prohibited Dunlap’s involvement in the organization, governance or management of the three Rainier Recovery facilities. He was allowed to serve on the provider’s governing body, in a “very limited capacity.” The agreement didn’t forbid Dunlap from practicing in the field or opening a related business, he said.
Under the settlement, Rainier Recovery had agreed that the cited violations could be used against the provider in future administrative actions.
