By Zach Hagadone
Reader Staff
In its first meeting of 2026 — and including newcomers Joe Tate and Joshua Torrez — the Sandpoint City Council made what Mayor Jeremy Grimm called “one of the most consequential votes that I’ve seen up here since I’ve been mayor.”
In a 4-2 vote, the council decided Jan. 7 to reject a land use agreement with Bridge Street LLC, which for years has been planning to develop the corner of Bridge Street and First Avenue, where several buildings were destroyed following a devastating downtown fire in 2019.
Councilors Pam Duquette, Kyle Schreiber, Tate and Torrez voted against the agreement, which would have given the city access to the private property on the corner in order to expand the sidewalk leading to City Beach in exchange for guaranteed vehicular access for the developer on the north side of Gunning’s Alley.
Council President Deb Ruehle and Councilor Joel Aispuro voted in favor.
The sidewalk project has been in the works since a land swap in 2020, following Bridge Street LLC’s acquisition of the fire-gutted property and later announcement in 2022 of plans for a 65-foot-tall, mixed-use development including condos and commercial uses billed as “small town luxury living.”
As part of the initial development process, Bridge Street LLC negotiated a land swap with the city of Sandpoint, trading the city’s property encompassing 13,634 square feet — with 6,649 square feet underwater — for a six-foot-wide strip of right of way along Bridge Street amounting to 890 square feet.
In addition, the city and developer partnered to construct a new retaining wall with stairs and landscaping along Bridge Street to improve access to the waterfront boardwalk and adjacent businesses along Gunning’s Alley — also referred to as Farmin’s Landing — in addition to widening the sidewalk, which serves as the only pedestrian access to City Beach.
However, the developer failed its contractual obligation to construct the widened sidewalk and sought a land use agreement that would grant the city permission to access its property in order to build the sidewalk.
Meanwhile, Bridge Street LLC posted a performance bond of $385,000, which was meant as a guarantee that it would perform the agreed-to work. Now, with the developer having failed to live up to the terms of the original agreement, the city would use those dollars to build the improvements.
“[U]nder that agreement, Bridge Street LLC was required to construct sidewalk along Bridge Street. They have not completed that requirement,” said Public Works Director Holly Ellis. “In that land swap agreement … it held a provision where the city was allowed to step in and build those improvements. …
“[T]he bond is expected to cover 90% of the project. I say 90%, roughly, because the project is not complete yet,” she said, later adding, “The remainder of the project would be covered by our resort city tax sidewalk fund. It’s unfortunate that we don’t have enough funds to cover the full project, but that’s where our pricing landed.”
Tate described the land use agreement as “bowing down to the developer again for another agreement.”
“I’m just representing constituents … [who are] not very happy about that,” Tate said.
Ellis said that rejecting the land use agreement would bring on financial consequences, stemming from the cancellation of the existing construction contract, though no hard figures were shared at the meeting.
Schreiber was the most forceful voice against the land use agreement, saying:
“We originally entered into an agreement with this developer to benefit our downtown. Has that happened? No, we still have blight. We actually just applied for a grant using this property as the example of blight in our downtown. This land swap has not benefited us at all. When [the developer] didn’t perform, we came back to the table and said, ‘You know what, we’ll give you another year.’
“Did we ask for anything from him at that point? No, we didn’t,” Schreiber continued. “We said, ‘Here’s another year.’ He still didn’t do it. And so now, when we’re finally sick of waiting and we’re going to spend our money — including taxpayer dollars — to do the work that he agreed to do in exchange for this land, now he’s saying, ‘No, you have to give me more in order to do the work that I agreed to do.’ And there’s no guarantee that that is going to fix our blight. Nothing we’ve done with this developer so far has done anything. So there’s nothing requiring this guy to do anything valuable for our community by giving him this vehicular access.”
