After Wyoming State Parks settled with the former owner of the popular Star Plunge hot springs facility in August for $1.8 million, inspectors discovered gas leaks, sagging beams and “significant problems with the pools,” Wyoming State Parks Deputy Director Nick Neylon told lawmakers Tuesday.
The findings throw a wrench into the state’s plans for the Hot Springs State Park pools and water slides in Thermopolis, Neylon told the Legislature’s Joint Travel, Recreation, Wildlife and Cultural Resources Committee.
“We’re at the point now where we need to decide whether we want to continue to put money into this facility that is in really poor shape, or do we want to just build something new, something first class for the people of Wyoming and the people of Thermopolis,” Neylon said.
It’s the latest twist for the embattled Star Plunge, a mineral-springs-fed destination of pools, tubs and slides that has been closed to the public for nearly two years while a lawsuit filed by former owner Roland Luehne against the state was argued in court.
Wyoming and Luehne reached a settlement in August that concluded all litigation and stipulated the state reimburse Luehne’s company $1.8 million for capital investment and ongoing business concerns at the facility.
The agency reached a similar settlement with a second concessionaire in the state park, Big Springs Spa, Inc., which operated the Hot Springs Hotel. The state agreed to pay the company $1.2 million.
The settlements resulted from Wyoming State Parks’ years-long effort to update and modernize the park’s aging facilities. Critics have accused the state of attempting to Disney-fy the park and warn that the efforts will price out many loyal patrons. Supporters say improvements at Wyoming’s most popular state park are long overdue.
When the state announced the Star Plunge settlement, Neylon said the facility could soon reopen to the public.
Now, however, the agency is not so sure, he said Tuesday. The parks department is waiting for inspection reports on the facility’s electric system before it makes a determination on what to do next, he said.
“We’re going to take a look at that electrical report when we get it and move forward from there,” Neylon said.
Replacement dispute
The spring-fed mineral waters of Star Plunge and Hot Springs State Park have been a destination for residents and visitors for centuries. Native Americans visited the waters, which they prized for their healing qualities, long before white settlers. The original 1-square-mile park was established through a treaty.
The public park, which sits on the banks of the Bighorn River, features playgrounds, a boardwalk over mineral terraces, multi-use trails and aquatic facilities along with numerous buildings.
As landlord, Wyoming holds concessionaire agreements with park operators. That includes the Star Plunge and Teepee aquatic facilities and two hotels. All four were built decades ago and are in various stages of aging. Wyoming also operates a state bathhouse, which is free and open to the public per the treaty language.
The Luehne family had operated the Star Plunge since 1975, when Wolfgang and Christine Luehne bought it and took over a 50-year concessionaire lease. Their son, Roland, bought it from them in 2012.
In 2024, Wyoming State Parks selected Wyoming Hot Springs LLC to take over running Star Plunge after requesting proposals from interested operators. The company’s primary representative, Mark Begich, a former U.S. senator from Alaska, also purchased the nearby Tepee Pools in late 2023. Hot Springs LLC’s application laid out plans for significant upgrades and renovations.
The state’s selection promised to effectively evict the Luehne family from Star Plunge. Luehne had been operating on a string of short-term management agreements since 2008.
Luehne contested the process in a pair of lawsuits filed by his company, C&W Enterprises. They accused Wyoming State Parks of exceeding its authority and violating regulations. Luehne argued the state was attempting to dislodge him without fairly compensating him for the improvements.
The Star Plunge closed in early 2025 after Luehne’s most recent management agreement expired.
The state, meanwhile, defended its process in court filings and statements. The court dismissed Luehne’s first lawsuit, and the second one, over compensation, was set for an October trial.
In the spring, lawmakers earmarked $3 million in the budget bill for “concessionaire remedies” at Hot Springs State Park and mandated the state appraise the businesses.
That led to this summer’s settlements.
Good news, bad news
During an agency update before the travel committee Tuesday, Neylon started with what he described as the good news.
“As of today, we own the Star Plunge,” he said, and “we’ve come to an agreement with the owner of the Hot Springs Hotel, the former Days Inn.”
With the litigation over, “we are able to move forward developing these properties with a new concessionaire, like we’ve always hoped that we could, that’s the exciting part of the news,” he said.
But the infrastructure problems pose new questions about how best to proceed with the historic facility.
The state now owns a hotel and a “facility that’s kind of falling apart,” said Co-Chair Sen. Bill Landen, R-Casper. “If you could get all the resources you needed, what is the vision there?”
Wyoming State Parks has been “disappointed” with the quality of three of the four Hot Springs State Park concessionaire properties for some time, Neylon said: the Star Plunge and Teepee pools and the Hot Springs Hotel.
“We’re now in a position where one concessionaire can operate all three of those for us,” Neylon said, referring to Begich’s Wyoming Hot Springs LLC.
“This is a company that has developed quality facilities in other parts of the country, and is interested in coming here and spending a considerable amount of money to renovate and potentially expand the hotel and to do something with the water park situation at Hot Springs.”
The state has yet to finalize what that “something” is, Neyon added.
“We know that there will be something new there,” he said. “We’re just not sure where it will be. Will both locations continue to have a water park where the Teepee is and where the Star Plunge is? Maybe, but maybe not. That’s going to be part of that negotiation and discussion that we have with the concessionaire.”
