Business Community
Neighbors battle expansion of Kensington Gardens, a luxury elder care campus
The state Department of Social and Health Services (DSHS) has determined that local elder care business Kensington Gardens is illegally operating as an unlicensed adult family home. The department sent the business a cease-and-desist letter and issued it a $5,000 civil fine in July.
Kensington Gardens co-owner Kelly Watson said she has appealed the decision. It is unclear whether the matter has been kicked up to the Attorney General’s office, which said it “doesn’t comment on potential investigations or regulatory actions.”
Community fighting development
The matter represents just a sliver of a years-long community battle over the ongoing development of Kensington Gardens, a large luxury living complex. Kensington Gardens includes two massive residential structures and one smaller house that functions as staff offices. Kensington Gardens is located on Olson Drive NW, near Artondale.
Among other concerns, neighbors worry that the complex uses septic and sits atop an aquifer recharge area. The area is surrounded by wetlands and is home to several threatened species. The development’s neighbors also all use well water. If Kensington’s septic system leaks, the consequences could be disastrous.
Pierce County also issued a letter to the Watsons in January, noting several pieces of inconsistent information they needed to correct as part of an application to subdivide the parcel. But the county reversed course following a letter from the Watsons’ attorney, Bill Lynn. Among other things, the letter appeared to tell the county’s lead planner what was and was not in his scope of work.
Despite this community opposition to the development, the DSHS investigation findings, and the county’s own initial concerns about missing documentation, the Watsons moved forward with their plan to develop the property.

The Hawksworth Villa at Kensington Gardens, as seen from the road on Aug. 17, 2025. Photo by Carolyn Bick. © Carolyn Bick
New buildings proposed
The new proposal subdivides the property to allow for four more large residential structures and two smaller, accessory buildings. This plan requires the go-ahead from Pierce County. While Pierce County’s Department of Planning & Public Works recommended approving the subdivision, planners raised red flags about the developer’s real plans.
As with a previous large residential structure, these new buildings are under review as single-family dwellings and will be used to house elders. In official testimony, planners noted that the plat application indicates “possible intentions for the plat to be used for something beyond the use of a single family dwelling.”
A plat is a map or a plan of a property. The Watsons are proposing a subdivision plat, which means the map reflects the divided pieces of their property.
The new buildings are the subject of an ongoing legal hearing, the first two days of which took place Aug. 11 and 12. The next hearing is slated for Aug. 26.
Expert witnesses testifying in support of an environmental appeal filed by Kensington neighbors Erika and Dana Zimmerman supported community fears, particularly when it came to possible septic leakage and potential danger to the wetland. The Zimmermans, who live across the street from Kensington Gardens, have raised concerns about the development for several years.
Because of this opposition, the Zimmermans also received what they felt was a threatening letter from Kelly Watson. The letter advised them to drop their appeal against the Kensington Gardens development, otherwise Watson would expose allegedly un-permitted work on the Zimmermans’ own property.
History of Kensington Gardens
Kensington Gardens has operated since 2007, though both Watsons come from a construction background. Their resumés include building design for major companies like Lockheed Martin and project management for the Tacoma Narrows Bridge.
Kelly Watson said during an Aug. 6 on-site interview with Gig Harbor Now that Kensington Gardens began as a wedding venue and became a continuing care home in 2012, when she wanted to provide care for her aging father and mother. She said that the living conditions in the assisted living facility she eventually put them in were abominable. Her parents and other residents almost never left their rooms. She also cited high turnover among caregivers, who ignored residents, favoring texting on their phones over caring for elders.
“And so my dad was sleeping 20-22 hours a day,” Watson recalled. “And he was just walking around like he was slowly dying.”
Watson said that witnessing the conditions in the available living facilities spurred her and her husband to open Kensington Gardens as a continuing care facility in 2012.
Hawksworth Villa
Kensington Gardens currently includes three buildings: Regent Park, the Carriage House, and the Hawksworth Villa.
The development originally just had the Carriage House and Regent Park, which Watson also refers to as the Manor. Watson said she and her husband lived for several years at Regent Park.
The Watsons started the permitting process for the Hawksworth Villa in 2019. The villa opened in February 2023. Due to the ongoing COVID pandemic, residents didn’t move in until July 2023, Watson said.

The Hawksworth Villa at Kensington Gardens, as seen from the road on Aug. 17, 2025. Photo by Carolyn Bick. © Carolyn Bick
Pierce County permitted the Hawksworth Villa — with more than 18,000 square feet of living space, a more than 9,000-square-foot garage and almost 3,400 square feet of decks and covered porches — as a single-family home.
Available documentation shows numerous pieces of information missing from the Hawksworth Villa proposal. By its own permitting laws, Pierce County requires those pieces of information, but does not appear to have enforced those laws, instead permitting the villa as a single-family home. Pierce County declined to comment on anything regarding Kensington Gardens, due to the ongoing legal proceedings.
Questions about villa
But a Pierce County code inspector, Nick Waggood, later discovered several problems with the villa. He concluded that he could not approve the structure as a single-family residence — the kind of structure Pierce County had specifically permitted.
Among the issues Waggood found were that the villa did not match the floor plans submitted to and approved by the county.
“Nick [Waggood] did not know how to do code,” Watson said, in the course of explaining to Gig Harbor Now why she believed Waggood was wrong in his official assessment of the villa and its layout, and his calculation of the number of rooms.
At the time he inspected the building, Waggood was Pierce County’s Building and Code Enforcement Division manager, which meant that he led the department’s Code Enforcement Division. He led the division for almost three years.
Utility issues
Waggood also flagged that the villa was not yet connected to public water, despite the stipulation that it had to be. County law requires that adult family homes be connected to public water, not well water. He also said that the villa’s septic connection needed to be reassessed, because it included more rooms than in the final plans submitted to the county. He also noted that the Watsons needed a permit for an adult family home, and that, under that permit, they could only house six people.
Watson said that it took a while to connect to public water, and that she and her husband were still in the process of doing just that when Waggood flagged the issue. She said she wanted a public water connection rather than well water, but it was “absolutely impossible” to do before the villa opened, due to COVID.
Instead, Watson said that she asked the Department of Health (DOH) if she could test the well water provided quarterly, which she said they allowed. In the meantime, she said, she hooked up to public water, which took a year.
Another issue with the villa and its permitting process is what appears to be a potential conflict of interest: Carl Halsan, the agent in charge of applying to Pierce County on the Watsons’ behalf — and, therefore, overseeing the submission of all documents — for Kensington Gardens’ permits, was and still is married to Planning & Public Works’ now-former assistant director, Melanie Davis Halsan.
Davis Halsan worked at the department when the Watsons were seeking (eventually successfully) permits for the Hawksworth Villa. She left the department in late 2023.
It’s unclear why no one at Planning & Public Works flagged this as a potential conflict of interest.
Regent Park
The Watsons had begun an application for an adult family home license for the villa at the time of Waggood’s inspection — which he stipulated in his investigative findings that they needed. They withdrew their application shortly after, in April 2023.
The Watsons had also cancelled their adult family home license for Regent Park in February 2023. Regent Park was the subject of the DSHS investigation.
In the July 11 cease-and-desist letter to the Watsons, DSHS stated that the Watsons must pay a $5,000 civil fine within 28 days of receiving the letter. DSHS also stated that the Watsons must cease operations within 30 days of receiving the letter and “ensure that individuals receiving care and services are relocated to a safe location.”
Cease and Desist letter by vince.dice
If the Watsons ignore the letter, DSHS can impose daily fines of up to $10,000, and initiate legal sanctions for continued operation.
When Gig Harbor Now visited the site on Aug. 6, elders still lived in Regent Park.
The Watsons filed their appeal of DSHS’s decision the following day, on Aug. 7.
The state defines an adult family home as “a residential home in which a person or persons provide personal care, special care, room, and board to more than one but not more than six adults who are not related by blood or marriage to the person or persons providing the services.”
The law states that an adult family home may serve up to eight people if it gets approval from DSHS.
Adult family home or not?
The Watsons claim in their appeal that no structure on the property qualifies as an adult family home, because, they said an adult family home “is a residential home where a single person or entity is licensed to provide personal care, special care, and room and board.”
Because Kensington Gardens itself doesn’t provide any special care, and the residents only rent rooms from the business, the Watsons argue it doesn’t fit the definition of an adult family home.
“Special care is offered by other licensed in-home care providers,” the appeal reads. “Residents have personal choice as to the level of in-home care and as to the specific provider.”
In a July 15 email to Amy Abbott, DSHS’s director of services and residential care, Watson further defined the grounds for her and her husband’s August appeal. Watson provided the email to Gig Harbor Now.
Email to Amy Abbott at DSHS by vince.dice
In the email, Watson specifically points to the fact that Kensington Gardens is operating as two legally distinct entities, and that the residences are not tied to any single person. Instead, Kensington Gardens Holdings, LLC, operates as the landlord of the property leasing rooms. Kensington Gardens Corp., a separate entity, is licensed as an in-home services agency, and is the entity providing care services.
According to the Secretary of State’s website, Kelly Watson is the registered agent of both entities. She and her husband Mark are the entities’ governors.
Was the state aware?
The state’s definition of an in-home services agency is one that provides non-medical services — things like providing food, assisting with bathing, and doing laundry.
Watson said that she talked on the phone with Lisa Cramer, the adult family home field manager at DSHS — the same agency that found Kensington Gardens was illegally operating Regent Park as an adult family home.
Watson said she described to Cramer how the concept of adult family homes didn’t work for what she and her husband were trying to do.
“They knew when I canceled the first one, we told her what we’re doing,” Watson recalled of her conversation with Cramer. “I said, ‘I will be canceling my next one.’ So, yes, they knew, and she even came on the [2025] inspection.”
Watson provided Gig Harbor Now an email acknowledging one of the license cancellations Watson said she spoke with Cramer about.
However, the email, dated Feb. 16, 2023, only states that DSHS will “begin the voluntary closure process of Regent Park at Kensington Gardens.”
The email does not contain mention of the specificities of the conversation Watson recalls, and does not acknowledge that Cramer either understood or agreed with “what [the Watsons]’re doing” and how the Watsons were planning to run the residences on the property.
Cramer did not return an emailed request for confirmation of Watson’s recalled conversation or confirmation that she accompanied the DSHS inspector.
Community opposition
The Zimmermans’ appeal of the project is based on years of community concern about the Kensington Gardens development. These concerns include the environmental and community safety impacts of adding to the already large complex, as well as the impact on the area’s rural character. Most of the area around the European- and English-style Kensington Gardens is populated with more rural-style houses and farmhouses.
The same community members who are concerned about the ongoing impacts of the development have also largely objected to the possibility that Pierce County could once again approve large structures as single-family units — when they are in reality much larger than a single-family home, and being operated as residential elder care facilities — just like it did with the Hawksworth Villa.

The Hawksworth Villa at Kensington Gardens, as seen from the road on Aug. 17, 2025. Photo by Carolyn Bick. © Carolyn Bick
The massive development sits atop an aquifer recharge area — an area that the state Growth Management Act requires the county to protect. The Zimmermans and their neighbors all use well water that aquifer provides. The ecosystem of the wetland around them is fragile.
In 2020, Pierce County received hundreds of comments opposing the eventually built Hawksworth Villa, including handwritten letters and a petition that more than 1,100 people signed.
Watson contended that the people signing the petition are “from all over the country — they don’t even live here.”
This is partially true. Most of the signatories appear to live in Gig Harbor, and many live in Washington. Some people do live out of state, but not many. Moreover, several people who signed and listed a residence elsewhere state that they lived in the area as children, or that it was their hometown.
New petition
The Zimmermans have launched another petition against the newly proposed structures on the property. At the time of this writing, it has a little less than 150 signatures. New public comments also express concern about the new building plans.
Several community concerns emerged during the first two days of the Kensington Gardens hearing on Aug. 11 and 12. Gig Harbor Now will break down the ongoing hearing in detail in a future article.
The Zimmermans have alleged that the environmental impact assessment the State Environmental Policy Act (SEPA) requires the Watsons to make is incomplete and, for the most part, incorrect. Because of this, they said, the submitted mitigation plan for the development is inadequate.
Expert testimony
In her expert testimony for the appellants, during the permitting hearing’s second day, wetlands expert and plant ecologist Dr. Sarah Spear Cooke not only agreed with that assessment, but explained the many ways in which the Watsons’ environmental assessment was done incorrectly. This includes the time of year the Watsons assessed the area — in the winter, outside the growing season — as well as the fact that they did not have a third-party certify their results. She also pointed out that the Watsons’ assessment failed to note a stream corridor running through the middle of the site.
The stream is listed on the county’s GIS map, and is named Murphy Creek.
Cooke has been a wetlands consultant in the Pacific Northwest for 42 years. In addition to working as a private wetlands consultant through the company she founded, Cooke Scientific, her work includes teaching the Army Corps of Engineers what would eventually become their official delineation manuals, which deal with determining what qualifies as a wetland. She has also helped the state develop its wetland ratings, including the current one the state uses and that is being used for the Kensington site.
SEPA checklist
Similarly, during his expert testimony regarding the development’s septic use, Timothy Gross — a professional engineer with more than 30 years of water and wastewater management in several states and who also served as the director of public works in Newport, Oregon — agreed with the Zimmermans.
Gross pointed out several problems in the Watsons’ sewer portion of their SEPA checklist. He said that the checklist includes directly conflicting and inconsistent information. For instance, he said, though the Watsons currently use septic and plan to use septic for the development, they checked “not applicable,” when asked about septic systems and drainfields.
Related story
The Zimmermans allege that the Watsons sent them a threatening letter following their appeal of a subdivision plat at Kensington Gardens. Read more here.
He also said that a good deal of information is missing, which makes it impossible to calculate whether the existing septic system can handle more load, as well as whether the Watsons’ plan for the development even has a plan to install equipment necessary to deal with an increased load, should the need arise.
On the whole, Gross concluded, “in my professional opinion, [the Watsons] did not provide enough information for the County to determine if they have the ability to provide the septic or the sewer capacity for the proposed preliminary plat.”
Septics at Kensington
In her interview with Gig Harbor Now, Watson said that their residences have septic flow monitors. She provided Gig Harbor Now with septic inspection reports completed by Nathaniel Lea of 4 Sight Septic, Inc., from April 2025. One report was for Regent Park, while the other was for Hawksworth Villa.
The report for Regent Park determined that the septic appeared to be operating properly, but Lea noted that he could only find and could therefore only flush one of the six lateral lines of the system. A lateral line is what evenly distributes treated septic water into the designated area of ground.
According to Lea’s report, the Regent Park system can handle 840 gallons of flow, but he did not note how much of that capacity was used.
The report for the Hawksworth Villa, however, notes that the villa has a cycle timer, which gave him the flow reading for the structure. It is unclear whether Regent Park has a cycle timer.
Lea reported no issues at the time of inspection, and that the average daily flow for the villa over the previous nine months was 426 gallons per day, based on the cycle timer’s readings. He stated that the total amount of flow the system can handle is 960 gallons per day.
Occupancy questioned
However, during the hearing testimony, Gross said that the method of calculation to arrive at this number was a “wildly inaccurate way to determine how much waste you have going into your septic system,” because proper septic calculations are based on the number of bedrooms. This is in compliance with current Washington’s Department of Health standards.
He said that Lea’s calculation was “irrelevant … because the capacity of the system is based on bedrooms, not what it’s actually receiving, because it has the potential to see more.”
In other words, more people could move into the villa, or any other building with open bedrooms. A 16-bedroom residential building would therefore require a system with at least a 1,920-gallon capacity, he said.
Erika Zimmerman also shared with Gig Harbor Now the designation of her family’s house as an historic landmark. She also said that there are several other historic properties in the area that are even older than her family’s house, but that they are not part of the Pierce County Historic Register.
However, where the SEPA assessment asks about historic properties in the area, the Watsons stated that there were none.
Additionally, the county itself appears to have found a number of what it called, in a letter sent to the Watsons, “inconsistencies between the plat application and SEPA checklist in comparison to the submitted [traffic impact analysis] and what is permitted” in the rural zone in which Kensington Gardens stands.
Watsons’ attorney responds
The county stated that it could not issue a SEPA threshold determination without those inconsistencies being resolved.
But Bill Lynn, the Watsons’ attorney, sent the county a response in which he dismissed the county’s concerns, said that the county “agreed [the Hawksworth Villa] was a single family residence,” and told the lead planner, Tony Kantas, that “[t]rip generation should not be in the purview of your review.”
The Watsons’ response by vince.dice
The statement that the county agreed the villa was a single-family residence is true — with caveats. The Watsons were required to perform mitigation work in the process of its construction, including signing an affidavit agreeing to limited occupancy, and removing permanent appliances and wiring to individual suite kitchens.
Following this letter, the county issued the Watsons a mitigated determination of non-significance (MDNS). It is unclear why they did this, given the history of concerns about the actual use of the properties.
This means that, if the hearing examiner approves the subdivision platting application, the Watsons are allowed to proceed with their proposed plans, despite the fact that the county itself already determined that certain required information was, at the very least, inconsistent.