A Snoqualmie hotel that for months had been missing payments required by its development agreement with the city has paid the $150,000 it owed.
Chun Lai Hospitality LLC, owners of the Snoqualmie Inn by Hotel America, were required under an agreement with the city to make an initial $60,000 deposit into a segregated bank beginning in December 2020. That was to be followed by monthly payments of $15,000 until funds totalled $150,000. None of those funds were deposited until last week.
“I’m a little frustrated with the folks at that hotel who didn’t get this stuff done as they originally committed to, but that’s water under the bridge now I suppose,” Mayor pro tem James Mayhew said at a community development committee meeting. “The key now is let’s live up to that agreement.”
That agreement was designed to give the city protection if the hotel, which had switched from a Hampton Inn franchise to an independent model, failed to meet quality and price-point standards of a mid-tier hotel.
Chun Lai first entered into a development agreement with the city to build its hotel on the Snoqualmie Ridge in 2017, under the requirement it remain a Hampton Inn franchise for at least 20 years in an effort to regulate prices.
At the time, the city’s closest hotel was the five-star Salish Lodge and Spa. The city was hopeful a lower-rate hotel could attract more visitors to stay in town and provide a boost to businesses.
Two years after opening the hotel, however, Chun Lai submitted a request to the city asking for an amendment to that agreement, which would allow the hotel to operate independently.
A decisive 4-3 vote by the city council in December 2020 allowed the change under the condition that Chun Lai provide $150,000 in assurance funds and perform regular audits.
Jason Rodgers, the city’s community development director, said on March 7 that $60,000 had been deposited. The remaining $90,000 was expected to clear March 10, according to city attorney Bob Sterbank, adding that the city is “bird-dogging,” the hotel owners.
“I would say the hotel folks are well aware of the city’s position at this point and the issues with timing,” Rodgers said. “We are staying very actively on top of them on this.”
Mayhew said several city council members had raised concerns about the missing payments for months. When asked how long the city had been aware of the issue, Rogers said in an email it was something they had “communicated with the owners about regularly.”
The hotel’s agreement with the city also included a provision that owners contract with an independent consultant for quarterly performance audits. Those audits were required to be shared with the city by Dec. 23, 2021. The city received those reports last week.
“They’ve been doing what they should be doing, they just haven’t shared that information with us,” Snoqualmie Mayor Katherine Ross said, adding that the hotel has seen a large amount of turnover in management.
Snoqualmie resident Ricahrd Scheel, the husband of former councilmember and mayoral candidate Peggy Sheppard – an outspoken opponent of the hotel’s development – expressed concerns about the missing funds during a public comment portion of the city council’s Feb. 28 meeting.
Scheel filed a series of public records requests, which were shared with the Valley Record, that showed no history of the deposits and no record of the hotel’s audits.
A request for comment by Chun Lai was not returned by press time. Rodgers said the city values its ongoing partnership with Chun Lai and the hotel serves as an important business institution for the community.
