Star Plunge owner sues after state picks new pool operator

by Katie Klingsporn, WyoFile.com

via Wyoming News Exchange

The longtime operator of Star Plunge aquatic center in Hot Springs State Park has sued the state after Wyoming State Parks selected a new concessionaire to run the hot-spring facility.

The complaint, filed Aug. 5 in Laramie County District Court, accuses the Wyoming Department of State Parks of exceeding its authority and violating regulations when it selected the new operator this spring.

That selection essentially evicts the Luehne family from Star Plunge, a popular Wyoming tourist attraction it has run since 1975. At the end of 2024 — when Roland Luehne’s current management agreement expires — the new company, Wyoming Hot Springs LLC, will take over.

Wyoming State Parks intends to make the handoff without properly compensating Luehne’s company, C & W Enterprises, for the improvements it’s made to the facility, the complaint alleges. The suit requests that a judge declare the state’s actions null and void.

“C & W has invested millions of dollars into the Star Plunge facilities over the past several decades,” the suit reads. “Despite those investments and C & W’s ownership of all improvements at the Star Plunge, State Parks deprived C & W of a fair opportunity to compete in the bidding process and seeks to deprive C & W of its property without compensation and any meaningful public notice or due process.”

The suit is the latest in a chain of landlord-tenant disagreements between the state and Star Plunge involving lease terms, contract language and deferred maintenance.

Since the new operator was announced, Luehne and loyal Star Plunge patrons have expressed outrage that the state would boot a family business in favor of an operator they fear will raise prices.

State Parks defends its process as transparent, above board and in the best interests of the community and state. Hot Springs State Park is the gem of the state’s system, and it’s time to update the aging infrastructure to meet modern demands, State Parks officials and supporters say.

In a state where generations of families grew up visiting the pools, the issue has sparked debates that pit nostalgia and local-business values against modernity and outsider ideas.

Nearly 50 years of business

Hot Springs State Park is centered on the banks of the Bighorn River, where mineral-rich water gushes from several springs and over terraces.

The original 1-square-mile park land was established through a treaty between the Shoshone and Arapaho tribes and the U.S. government. The feds purchased the land in 1896, and ceded the “Big Horn Reserve” to the state in 1897 on the stipulation that there always be free public access to the waters. It operated as a reserve for more than three decades before becoming Hot Springs State Park, and predated the nearby town of Thermopolis.

Unlike parks that offer wilderness experiences, Hot Springs’ eponymous springs were long ago developed into indoor and outdoor pools with steam rooms and slides, while parking lots and paved roads encircle the grounds. Two hotels today occupy its 1,100 acres, and it hosts an assortment of built infrastructure, including a hospital, county library, fairgrounds and schools.

The park tallies more than 1.5 million annual visits, more than double any other in Wyoming’s system. And in a state with no permanent amusement parks, Hot Springs’ two aquatic facilities — Star Plunge and Tepee — have long drawn families with kids.

As landlord, Wyoming holds concessionaire agreements with park operators. That includes the Star Plunge, Tepee and the two hotels. Wyoming also operates a state bathhouse, which is free and open to the public.

Wolfgang and Christine Luehne bought the Star Plunge in 1975, taking over a 50-year lease from the previous owner. Roland Luehne bought the Star Plunge from his parents in 2012. Their lease expired in 2008, and the Star Plunge has been operating on short-term agreements since.

Attempts to ink a long-term contract were unsuccessful, but a 2019 law mandates that State Parks secure long-term leases with concessionaires.

In 2020, Wyoming put out a request for proposals for parties interested in operating new or improved lodging and aquatic facilities in the park. The idea was to secure long-term leases that support the 2016 Hot Springs State Park Master Plan, which envisions a more polished destination with modern recreation offerings.

“Today, some concessionaire operated facilities are deteriorated with extensive need for improvement and redevelopment,” the plan reads. “This plan encourages reinvestment in public and private facilities, replacing outdated features to prioritize life, health and safety; and offers opportunities for collaborative partnerships to meet the Division’s key mission of public benefit, resource protection, and high-quality visitor experiences.”

Luehne was the sole applicant in that initial round, but he and the state failed to reach an agreement. He was one of three applicants in round two, which opened in November. This time, the state opted for another applicant, Wyoming Hot Springs LLC.

That company’s bid proposes transforming Tepee into a spa and wellness center while enhancing facilities and the mid-century character of the Star Plunge with new slides, pools and a poolside diner. It also proposes rebuilding or renovating the Hot Springs Hotel with more rooms and upgraded dining areas.

In the wake of the announcement, Luehne and supporters have cried foul. His family has poured all its energy into Star Plunge, he said; to be stripped of it without any compensation for that work is unjust. He called the process “a nightmare.”

However, others have celebrated the new operator as a way to bring forth needed improvements for facilities that haven’t changed much in generations. Swimmers at Star Plunge still splash down original slides built decades ago, for example.

The state also wants to ensure critical deferred maintenance items that have gone for years unaddressed are taken care of, officials say.

“If Mr. Luehne had addressed all the issues we brought forward immediately over the years, and had attempted to negotiate in good faith with us on a lease … he could have been in the midst of a 25-year lease right now,” Outdoor Recreation Office and Division of State Parks Deputy Director Nick Neylon told WyoFile in June. “But he chose not to.”

Null and void

The lawsuit claims State Parks in 2021 essentially strong-armed Luehne into signing an agreement by threatening to close the Star Plunge over the busy July 4th holiday weekend. “You cannot operate the Star Plunge in the absence of a lease or agreement with State Parks,” that correspondence said.

The state then violated its concession regulations when it put out its second RFP bid and did not require a new concessionaire to pay the former one for the value of the property, the suit says. That requirement was in the first RFP, the suit maintains, and set the minimum value at $1.4 million.

The suit asks that State Parks start over and re-bid C & W’s concession prior to the expiration of the existing contract in “a manner that complies with the Concession Rules, and include a minimum amount that a successful bidder must pay to C & W as the current concessionaire.”

Wyoming’s response to the lawsuit will be included in official court filings in the near future, Wyoming State Parks Bighorn Region District Manager Brooks Jordan told WyoFile in an email. The state is proceeding with the new operator, he said, with which it’s begun negotiations.

“We continue to move forward with the process related to concession improvements at Hot Springs State Park,” Jordan wrote.

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