Plans for a new hotel in downtown Whitefish will go before the City Council next month with a recommendation of approval from the City Planning Board.

The board voted in favor of the project after developers came back with a new design for the $10 million three-story hotel at the corner of Spokane Avenue and Second Street.

Board members Rebecca Norton and John Ellis were in opposition.

The City Council will review the project Feb. 2.

Whitefish Hotel Group — which includes local developers Sean Averill, his brother Brian Averill and an unnamed partner in Florida — is requesting a conditional use permit to construct the 89-room hotel. The permit is required because the proposed footprint of 15,000 square feet doubles the city’s 7,500 square-foot “big box” limit for downtown buildings.

The property is zoned WB-3, which allows hotels as a conditional use.

At its Dec. 18 meeting, the planning board cited concerns with the hotel’s overall mass and impact on the residential neighborhood, the amount of parking, whether it will be a chain brand hotel, and how developers plan to deal with possible groundwater pollution at the site. They asked developers to return with more information for the January meeting.

The new site plan shows 72 parking spaces, five more than originally proposed. The developers are also entering into a lease agreement for a dozen off-site spaces for employee parking and plan to shuttle employees to the hotel during peak seasons.

About 37 employees are anticipated at the hotel, with 10 to 15 on duty at a time.

“I really think we have a handle on the parking situation,” Sean Averill told the board.

The planning staff noted there are no parking requirements in the WB-3 zone.

Access to the hotel parking is proposed be from alleys off Third Street and Kalispell Avenue. The alley access onto Spokane Avenue will be closed.

According to a traffic study, the hotel will produce 727 daily vehicle trips. The study does not recommend any improvements at intersections to improve capacity. Both the Montana Department of Transportation and the Public Works Department agree with the study findings.

Architects presented a refined design of the hotel that breaks from the “mountain modern” style previously touted.

“After hearing comments, we felt it would be nice to go back to a timeless look,” said Arron Wallace of Montana Creative Architecture and Design.

Changes were made to building materials, lighting and patterning. A rotating door and front steps were added at the corner entry, while the facade will now feature natural stone, tumbled brick and brick accents.

The plan also includes 15-foot setbacks along Spokane Avenue to allow for a future bike and pedestrian path.

“We worked hard to make sure the heights and setbacks are met,” Wallace said. “This gives it a much more pedestrian friendly environment.”

In voting to approve the project, chairman Ken Meckle said the board should consider that the property is zoned for high-density uses.

“It’s important to consider what happens if this [hotel] doesn’t happen,” he said. “There could be no setbacks and we would still have the issues we’re dealing with. No other entity is asked to provide parking in WB3.”

The board and some members of the public remained concerned about whether the hotel will be a franchise brand Marriott. The city has standards pertaining to “formula” franchises in Whitefish, but they only apply to retail and restaurants.

Brian Averill says they remain undecided about whether the hotel will be a franchise and asked the board for its input.

“If there are concerns about it being a franchise — if it’s a deal-breaker — we want to know,” he said.

He said they’re considering a franchise because it could increase occupancy by about 12 percent and eliminate “upfront risk” in the business venture.

Council member Richard Hildner said the franchise issue will be an important discussion point when the project goes up for final review.

“Exactly what will be inside and who will control and operate what’s inside — those will be major concerns of council,” Hildner said.

Citizens for a Better Flathead director Mayre Flowers told the board that allowing a franchise would go against the city growth policy.

“It’s splitting hairs to say a franchise for a hotel is OK, but not for a restaurant,” she said.

“Hold tight to your growth policy.”

Architectural Review Committee member Ian Collins noted that Whitefish’s downtown master plan calls for a boutique hotel, but that a franchise is “a totally different animal.”

“The intent of the growth policy is clear,” he said. “What people value is local.”

Some residents still questioned the overall mass of the project and it’s fit with the neighborhood.

“I couldn’t think of a worse location for it,” said Lauren Walker.

“If the goal is to make this a beautiful, amazing, wonderful town, we need to work holistically. A hotel would be great, but this is the wrong place.”

CMG Engineering supplied a report detailing drainage and water removal to address concerns about contaminated soils on the former gas station site.

Still, Norton remained concerned and cited it as a reason she voted against the project.

“I’m afraid of damaging other people’s property,” she said. “What if we get a high water year?”

Board member Jim Laidlaw countered that Public Works and the Department of Environmental Quality both will be involved in reviewing drainage plans.

“I don’t know if it’s in our expertise to make a decision on [groundwater],” he said.

Developers plan to offer limited food and beverage service — including beer and wine — but those plans weren’t included in the applicaiton.

If developers obtain a beer and wine license from the state, a conditional use permit isn’t required by the city.