Angie Lottes, The Watershed Center RCDI Workshop - April 5 th , 2016 - PowerPoint PPT Presentation

Angie Lottes, The Watershed Center RCDI Workshop - April 5 th , 2016 – Sacramento, CA

Hayfork Community Enterprises

Our vision - Integral with community - An incubator for entrepreneurs - Enhancing economic opportunities - Job creation - Synergistic businesses - Access to quality infrastructure - Administrative support as needed - Servicing local and regional markets - Enhancing natural assets - Wetland enhancement - Floodplain habitat restoration Wood utilization – and so much - more

Millsite finance - Purchase cost was $370,000. - Community bank loan ($250,000) – standard 30 yr. - $170,000 loan from (Trinity Timberlands/New Island Capital) – 5 yr. - included $50,000 in additional capital improvement funds to help get the site up to standard for basic operations (roads, electrical, building improvements, etc.) - WRTC is currently sole owner - Currently developing for profit structure (likely LLC) and seeking 10-15 local investors to buy down second loan and foster community investment and wealth creation - WRTC will maintain majority position - 2016 loan (in-process) will include additional capital improvement for roads, buildings and fire control

Tule Creek Forest Products  Bundled firewood production and sales  Heat-treated, certified pest-free  Grocery, convenience, and feed stores. Campgrounds

TCFP project development  Approximately $400,000 in development and start-up costs through year 1  Combination of foundation program-related investment ($250,000) and WRTC unrestricted funds  Used and new equipment, utility upgrades, installation, fabrication, building repairs, log inventory, payroll, sales

Year-1 progress  2 full-time year-round jobs  8 full-time seasonal (5 months)  50 log loads processed  10 loads finished product sold with 10 more bundled  Markets proven and additional IDed  Production streamlined  2016 production improvements IDed

TCFP going forward  Securing $400,000 in additional financing for year 2 inventory and operations (community bank loan)  Plan to purchase 150 log loads  Sales target of 100+ finished loads – 80% hardwood/20% softwood  Projected to achieve profitability at this scale in 2017

Beyond firewood  Merchandize out higher value logs from firewood supply stream  Currently have a small sawmill operating in peeler shed  Lumber for local fencing and bee boxes  Blanks for tanoak baseball bats  Exploring composting and vermicomposting with non- local business partner for regional markets  Courting non-wood product businesses as well  We want to fully develop the potential of the site, maximizing lease income and economic activity for the community.

Challenges  Substantial debt and risk  Continuing log supply questions  Potential for markets being flooded from drought-killed timber  Seasonal inventory costs and seasonal markets  Lack of incentives for wood energy in FERC-regulated area  Transportation logistics and costs from isolated community  Future utility upgrade needs  Training and maintaining workforce

Many thanks  Contact us: Angie Lottes angie@thewatershedcenter.com and Nick Goulette nickg@hayfork.net