‘I feel like we’re being played’

Council rejects Averill hotel proposal to lease or buy City Beach RV park, but sets workshop for future plans on the site

By Zach Hagadone
Reader Staff

Emotions ran high at the Nov. 5 regular meeting of the Sandpoint City Council, as a capacity crowd filled the City Hall chambers — with more residents waiting in the lobby — and the body considered whether to pursue discussions with Averill Hospitality about a planned fronted by the Whitefish, Mont.-based corporation to lease or purchase the publicly owned property south of its proposed resort hotel on Bridge Street adjacent to City Beach.

Councilors took in several hours of presentations, including from Brian Averill and local company representative Ben McGrann, as well as public comment — the latter which was overwhelmingly against the proposal.

Councilors voted unanimously to reject the lease or sale of the RV park parcel to Averill in a motion from Councilor Pam Duquette and seconded by Council President Deb Ruehle, though approved an amendment from Councilor Justin Dick directing city staff to organize a workshop inviting the company, community and Sandpoint officials to brainstorm how the property should best be used. Councilor Rick Howarth seconded the motion, which drew “no” votes from Duquette and Ruehle.

“I feel like we’re being played by Averill,” Duquette said ahead of the vote, adding, “I think we’ve heard pie crust promises” and expressing that she’d lost faith in the company’s expression of its intentions not only at the current site of the Best Western Edgewater Resort, but the beach area as a whole.

Her sentiment was echoed by the crowd in attendance, members of which testified one after another that Averill had overstepped the mark with a pair of letters sent in recent weeks to City Hall officials claiming that if the RV park property wasn’t either offered for lease or sale to the company, it would pull out of its multi-million dollar proposed development at 56 Bridge St.

Former-Sandpoint Mayor Carrie Logan called Averill’s proposal “rude and arrogant” and called on Dick to recuse himself from any votes related to the development, owing to his previous occupancy at the Edgewater as owner-operator of Trinity at City Beach and the potential that his popular eatery may find a new home with the Averill development in the future.

For his part, Dick said he has “no deals with the Averills; I have no conflict of interest.”

Multiple other speakers blasted Averill Hospitality not only for the tone of its most recent communications with the city, but for what many perceived as a pattern of accommodations for the developer, which has more than once warned that unless certain concessions were offered by the city, the project would be “unviable.”

In particular, community members and some councilors were upset by an Oct. 15 email sent to the city from the company that stated, “the Sandpoint Lakeside Resort project will not proceed if the city redevelops the existing City Beach RV park into any use other than parking. The character, density and proximity of an active RV park are incompatible with the level of guest experience, design quality and market positioning of the proposed four-star waterfront resort. Proceeding with the RV park redevelopment would jeopardize the hotel’s feasibility and eliminate the economic and community benefits this project is poised to deliver.”

According to the city’s staff report, Averill offered the options to lease the 2.29-acre property either through a 30-year agreement with renewal options and annual rent equal to 110% of the projected net revenues from the RV park following its redevelopment — an amount estimated at more than $100,000 per year — or to purchase the parcel outright “at fair market value.”

“To be clear, the Sandpoint Lakeside Resort cannot move forward without a binding agreement that the adjacent parcel will be reserved exclusively for parking use serving City Beach and the marina,” Averill wrote.

In subsequent conversations, those uses were described as including boat trailer parking, recreational watercraft storage and new public restrooms.

At the same time, a covenant dating back about 100 years with what is today BNSF dictates that the current RV park property must be used solely for “park purposes” or else its ownership will revert to the railroad. As such, councilors and Sandpoint Mayor Jeremy Grimm were unanimous in their statements that regardless of what happens on that land, it will remain public access.

The city stated in its staff report that, as of Oct. 21, no permits had been applied for or issued for Averill’s project.

In his presentation to the council, Brian Averill said, “I’d like to apologize” for the tenor of the communications, adding that there had been “misunderstanding and misrepresentation” of the intent of those statements to the city.

“The second letter [in October] might not have been the best way to say what our intent was,” he said, going on to claim that Averill’s goal at the Bridge Street location, current RV park location and City Beach at large is to “help create a city park that fulfills the needs of the community. That is our one and only intent.”

While several councilors expressed willingness to consider alternative uses for the RV park property — which the city recently secured $1 million in funding to redevelop, including from an Idaho Department of Parks and Recreation grant — others like Duquette and Ruehle, and to an extent Councilors Joel Aispuro and Howarth, took Averill to task for its messaging.

“Many in the community took the letter as a threat or intimidation,” Aispuro said.

“Your letter was very clear,” Howarth added. “It said if we don’t cave to your demands, your project won’t be done. You come here tonight with a different tone, so help us all reconcile what are the true intentions of Averill.”

While Averill repeated that the email wasn’t “a true representation of what our intent was,” Ruehle wasn’t buying it.

“I’m not going to be gentle; I’m going to be direct. I have German and Russian roots, and I’m frustrated,” she said. 

“I’ve experienced two threats from Averill,” she added, referring first to the company’s argument earlier this year that increased impact fees would make the project financially impossible and helping inform a council decision to defer those fees until after the turn of the new year in 2026, and the second being the October letter. 

“I really wish that you could see the public out here … they are not happy with you, and who I represent is them,” Ruehle said, later adding, “I’m not trying to be mean or disrespectful to you … you kind of stepped in the wrong direction.”

Given Averill’s apology and description of the company’s desire to help the community — all while stating that the content and timbre of the October letter was unrepresentative — Aispuro asked if it was still true that if the RV park wasn’t offered for lease or sale the hotel project would not go forward.

“We don’t 100% have an answer for that. They do work in conflict to some extent,” Averill said, later adding, “It’s not the best thing for the resort, no, so I’m not sure how that ends.”

“I feel like I’m listening to a teenager and I want a straight answer,” Ruehle said later.

Other speakers from the public doubted the sincerity of Averill’s statements, with many also pointing to past comments that are “far different than what we just heard,” as resident Pat Holland said.

“I trust the council — I don’t necessarily trust them,” said resident Tari Pardini, pointing to Averill company representatives in the audience.

Resident Bill Litsinger called the Averill presentation “corporate crapola” and “corporate greed, and as far as I’m concerned, if their lips are moving they’re lying.”

It was unclear by press time when the workshop might be scheduled. Watch the entire meeting at the city of Sandpoint’s YouTube channel.