City has had its share of highs, lows

Editor’s note: This is the 13th, and last, in a series of articles exploring the history of Spirit Lake and its environs as the community celebrates its centennial. Keith Spencer became interested in local history when he came across some old photographs while remodeling his home. He and his wife, Janette, researched the photos’ origins, began collecting old documents for posterity and now can’t seem to stop.

By January 1940, things seemed to be looking up for Spirit Lake. After all, it had survived the fire; beyond that, the storm clouds of the Great Depression were beginning to lift, providing real cause for optimism.

While the snow was piled high, folks were looking forward to spring and the reopening of the Spirit Lake Panhandle mill, with its 400 jobs. About the same time, Panhandle Lumber received a huge payment from the insurance company, a sum, which took care of all losses from the fire. The people rejoiced.

In early February the mill manager John Dimeling was summoned to Williamsport, Pa., for a meeting with the Panhandle Stockholders. He was stunned to learn that as the Feb.16 Rathdrum Herald so coldly put it: “Stockholders of the Panhandle Lumber Company, meeting recently in the east, voted to quit business and sell all assets of the Corporation.” When Dimeling returned, he announced that he was negotiating with the Panhandle to purchase the mill, with the intent of continuing operations.

Negotiations with the Dimeling group continued into March, when he stated that if he failed to secure a lease, a large company would take it over and operate the mill for many years. It soon became apparent that the stockholders wanted no part of Dimeling’s proposals. He announced his resignation in late March and duly noted “that the Panhandle properties will be liquidated.”

As this was going on, the planing mill commenced operations, to fill orders, using previously cut lumber. The sawmill never cut another log. Rumors abounded; most dealt with a white knight riding in to save the day, but this didn’t happen.

The liquidation process started in early April with a Seattle party buying the LeClere Creek Logging Railroad and rolling stock. By the end of May, most of the rest of the company assets had been sold. The timberlands went to the Diamond Match and Long Lake Lumber companies. Much of the Long Lake purchase was virgin timber, which had been held in reserve by the Panhandle for future use. Alaska Junk Co., of Portland, was awarded the contract for demolition of mill properties, including purchase of all equipment.

During this period, the Panhandle received permission from the Idaho Public Utilities Commission to sell the city (Panhandle) power plant and lighting system to Washington Water Power Co. It also received permission to abandon the 11-mile long Idaho Logging Railroad, which had operated for many years bringing logs from the Upper Twin Lakes District to the Spirit Lake mill.

The Spirit Lake Land Co., organized in 1907, filed for dissolution in district court toward the end of July 1940. This was the last major component of Blackwell’s vast Panhandle Empire to die. Note that the planer continued to operate until late September 1940 and then closed forever; demolition soon followed.

In the meantime, there was a lot of ugliness in Spirit Lake. To touch the tip of the iceberg, the last remaining major hotel, the Spirit Lake Hotel, operated by Panhandle Lumber Co., closed. Dr. Condon closed the hospital and moved to Spokane. The Keeners closed their drugstore and traveled to east. Budgets for staff and operations of the Spirit Lake School System were cut in half.

According to the 1940 census, Spirit Lake’s population fell to 1,003, a drop of 1,343 in 10 years. Perhaps the unkindest cut of all was loss of the Louis LaBarge box factory. This small, but historical company burned to the ground after an electric motor failed. This last event left the town, which at one time boasted 1,500 jobs, without any visible means of support.

The rats were leaving the sinking ship. If they could, people were selling their property for a dime on the dollar. Father found a good machinist job at Puget Sound Naval Shipyard and we moved to Bremerton. It was always their intention to move back to wonderful Spirit Lake so, though quite poor, didn’t sell their lakefront home providing my family and me many years of great pleasure.

As the rats departed, a few folks continued to believe in Spirit Lake’s future. Cliff and Lester (Jum) Hohman purchased all 40 of the company houses, the Spirit Lake Hotel, the hotel annex, the bank building and the big barn. They eventually also purchased most of the mill site and a large amount of property at the head of the Lake, including the meadow (spud ranch).

It took many years, but the Hohman brothers did very well for themselves. For a few years the mill sight was converted to and used as a small airport, but the area is now fully developed and known as Spirit Shores.

Phil Dolan, soon to become a noted Coeur d’Alene lawyer, also believed in Spirit Lake. Through the years he purchased much property in the area and is still helping in any way he can. Toe Beito was another believer, converting the old Opera House and its hardwood floors into a very popular roller skating rink. He also purchased considerable property including the old Thomas Hooker homestead on Cougar/Jenkins point. While it is impossible to name all those that contributed to Spirit Lakes continued survival; Fred Lundemo must be mentioned for his many contributions, including serving as chairman of the defense council during World War II.

By 1942, to support the war, the Navy Department began construction of Farragut Naval Training Station near Bayview on the shore of Lake Pend Oreille. This provided good jobs and increased prosperity for Spirit Lake. The Spirit Lake Hotel reopened as the Spirit Lake Apartments and it and the many available rentals were fully filled with naval personnel and their families.

While Spirit Lake was not as affected as some cities by World War II, it certainly did its part, as numerous families sent their sons and daughters into peril. For its size, Spirit Lake paid a great price with Jesse Beito, Art Eftedal, Norman Kramer, John Mott and Robert Sorenson making the ultimate sacrifice. They will always be remembered. Once the war was over, Farragut shut down and the bottom really fell out of the town’s economy. Spirit Lake had always considered itself an industrial place, but there was now little hope of attracting major industry and by the early 1950s, the population had dropped to 696.

While a few people commuted to jobs in Spokane and elsewhere, most of the population didn’t have the money to meet the town’s needs and the community began to look down in the mouth. At one point there were 19 saloons in Spirit Lake and now there were just three. Hard times had really arrived.

In the ’50s, the Spirit Lake area returned to its roots; a, serene and beautiful place, where people came to enjoy the ambiance. Shortly after the war, Homer Conklin, a Spirit Lake pioneer, opened the Anchor-In Marina on the southern portion of the long forgotten Chautauqua Grounds. The rest of this historical property rebounded as the Chautauqua Resort. The old Hooker place reopened as the Millers Resort, and Ed Sedlmayer opened a dance hall and resort. Of course, the historic Silver Beach resort continued to operate. People had rediscovered that Spirit Lake was a wonderful place to be and slowly, but surely, the town and area began to recover.

By the ’60s, developers began to discover the Spirit Lake area. A developer, whose name has been long forgotten, announced plans for a 200-boat marina near Rocky Beach and a huge residential development to be called Spirit Lake East. All hell broke lose as no one wanted the pollution, noise and other deleterious effects of such a huge marina.

This quickly led to the formation of the Spirit Lake Property Owners Association aimed at killing the whole project, especially the marina. Initial work was to plat Spirit Lake East and build the associated roads.

During the summer, with the wind directly blowing across the proposed development, a fire started at the north edge of Highway 54 and burned a large swath completely across the Spirit Lake East Plat. Officials could never prove arson, but most suspected that some angry citizen set the fire to kill the entire project. Plans for the marina were quickly abandoned and the development of Spirit Lake East was set back many years.

On June 20, 1974, fire destroyed the Spirit Lake Apartments, leaving 16 families homeless. Crews from four communities fought the blaze, but what was once know as the McMahon Hotel, the fanciest of the many early Spirit Lake hotels, was for all practical purposes destroyed. Sadly, this loss left Spirit Lake without its last major tie to its historic past.

During the ’80s, a severe crisis reared its ugly head. The many pilings driven into the millpond in 1908 were rotting and the lake’s sealed bottom started to leak. The leaking increased and the startled citizenry became really worried as the millpond began to completely empty during the summer and the overall lake level dropped at least 5 feet. Most wouldn’t know that the lake level was now back to where it was before Blackwell built his dam and mill.

A number of solutions were proposed, but state and county environmental regulations stymied all fixes and the problem continued to worsen. John Sempre, a California developer, had recently purchased much of the land around the millpond to build condominiums and a golf course; he was instrumental in creating a foundation aimed at fixing the problem.

Approval was finally obtained from the state and county to remove the topsoil (mud and logs) from the entire 56-acre mil-pond, line it with a rubber-like fabric liner and then put the mud/logs back where they had been. Phil Dolan, Wayne (Ole) Hohman, Kevin Miller and Mayor Bill Moe were instrumental in leading the charge toward a fix. Jim Brown Jr. and his crew procured the materials and did the work, which cost around $500,000. The project turned out to be successful beyond anyone’s wildest dreams and the lake is now back to its normal level.