The approval by the Board of Directors was the final step to move the 30 million dollar project forward.
Pioneer Memorial CEO Bob Gomes says they've outgrown the current facility and have struggled with how to meet the community's needs.
"You know it's an exciting day. What it says is St. Charles is investing in the community and going to provide healthcare now and into the foreseeable future. The investment in the community will hopefully spur other business and some economic growth out there."
The new hospital will be built on 20 acres on the old Ochoco Lumber site.
Construction is expected to start later this year or early next year and should be done in two years.