Dozens of workers in Idaho Falls lost their jobs Tuesday after the Shilo Inn on Broadway was abruptly shut down as part of bankruptcy proceedings involving the hotel chain’s parent company.
David Rail, who owns the restaurants and bars operating inside the hotel, said he learned of the closure while driving to work from Rexburg. The hotel manager called to inform him that court-appointed officials were at the property executing the shutdown that morning.
“The hotel is being shut down right now by the courts,” Rail said, recounting the conversation. “I hadn’t heard a thing. And then I went to shock for a second.”
Bankruptcy Forces Immediate Closure
The shutdown resulted from Chapter 7 bankruptcy proceedings involving Shilo Inn’s parent company. Under Chapter 7 bankruptcy, a business liquidates assets to pay creditors before the remaining debt is discharged.
When Rail arrived at the hotel, court facilitators were already on site directing guests to check out and securing the property. The process left employees with no advance warning before losing their positions.
Rail said he was forced to lay off all 18 employees who worked in the hotel’s food and beverage operations. The hotel itself employed approximately 10 to 12 additional staff members who also lost their jobs in the closure.
Pattern Across Multiple Locations
The Idaho Falls closure mirrors similar sudden shutdowns at Shilo Inn properties in Oregon, where employees at those locations also received no advance notice before operations ceased.
The abrupt nature of the closures has left workers scrambling to find new employment and address immediate financial concerns.
Final Weekend Events Planned
Despite the hotel closure, Rail said planned events will proceed this weekend at the property. A Cinco de Mayo celebration is scheduled to run Saturday and Sunday, featuring two stages with live performances, food vendors, and community entertainment.
“Come to Cinco de Mayo this weekend,” Rail said. “It starts Saturday, goes through Sunday, and it’s going to be big. We’re setting up a massive stage inside and then a smaller stage outside.”
What Comes Next
The future of the Idaho Falls Shilo Inn property remains uncertain as the bankruptcy process continues. Court-appointed trustees will likely oversee any potential sale or liquidation of the hotel assets.
For the nearly 30 employees who lost their jobs Tuesday, the immediate concern is finding new employment in Idaho Falls’ hospitality sector. The sudden closure provides no severance period or transition time for affected workers.
The bankruptcy proceedings may take months to resolve as creditors file claims and the court determines how remaining assets will be distributed.