Supporter News & Update

Hello Boulder Creek Brewing Company Supporters,

As some of you may recall from our last update, we have paid off the 1st TD on the brewery building, and now own the property free and clear. Much of this year, we’ve spent addressing the issues at the County and the California State Water Resources Control Board over septic requirements, which have changed significantly since the previous permits were issued.

Summary

Here’s a summary of where we are as of October, 2024 - We are in the home stretch to starting construction!

• After some delays this year, we now have have a septic design, and a path forward with the county and the CA State Water Board. TLDR, after much work: Previous septic is no longer to code and needs replacement.

• We’ve received permit extensions though Feb 2025. We will submit our septic design and county responses for approval.

• County responses - The responses to the correction letter we received, with the details of what needs to be addressed, from the 5 departments at the county - that’s my job, with the help & coaching of the rest of our team and HoganLS.

Now that things are moving again, we are ramping back up with the following:

• Builders' Bids & RFP - We have a draft RFP (Request For Proposal) to circulate to local builders for consistent, apples-to-apples formal construction bids, with schedules, details, contingencies, and proposed cost-savings improvements. We will also revisit the bids we obtained in the 2022 timeframe, before the recent Change Order responses and septic system plan.

• Business plan - Work resumes on the business plan, including restaurant planning, spreadsheets, and projections

• Construction Loan - The updated business plan will be part of the Construction Loan package to circulate to lenders - we will focus on local lenders, such as Santa Cruz County Bank - let us know if you have referrals / contacts / introductions to your favorite lender or rep. After considering the offers presented to us, we will choose the most prudent and best option taking into accounts all factors, such as lender reputation, reserve requirements, total loan amount, interest rate, points, add-on costs, and overall reputation, flexibility and impression of the lender representative(s).

• Call for Investors, Benefactors, and Community Support - The community has been great, and support has been overwhelming and unanimous from everyone – we are in the home stretch, so now is the time - We will need working capital, and ongoing reserves / funding during the buildout, even with the construction loan.

• Methods of contributing, being a benefactor, or investing, are below.

Detail

More details about the current status and what we’re working on now:

Managing the Wastewater and Septic system

Operating a brewery generates both wastewater and other waste material, and being this close to the River means more stringent wastewater requirements - so we need to replace the septic system, at significant expense. We evaluated four alternatives, all requiring costly modifications to, (or replacement of), the existing system, which is no longer approved. And because of new regulations, the “grandfathered” system is insufficient to host a restaurant with the same capacity as the business formerly had in 2015, around 65 people.

There is a silver lining - The good news is:

• Replacing the septic system will allow us to expand beyond the original seating / occupancy capped at 65 (possibly more than double). Higher seating capacity translates directly to higher revenue projections, which will mean easier approval for the construction loan.

• We’ve received permit extensions though Feb 2025. We will submit our septic design and our responses to the correction letter we received from the County on our permit Change Order application.

• We will brew on-site, and partner with local ranchers to take our spent grain from the brewing process for their farms, thereby reducing the septic load, which will likely allow us to increase our targeted restaurant capacity. This will also help the permit process with the County and the State.

Business, Restaurant, and Buildout Planning

We are finalizing the kitchen design and adding it to the plans, now that there is some clarity on the septic and wastewater plan. This also means we are finalizing the range of our menu choices, which can be prepared in said kitchen.

Work is ongoing with our business planning team, and our acting Brewmaster Jack Whybark, who has been a huge help in preparing the Business Plan spreadsheets, Restaurant planning and preparation, and Restaurant Management guidelines.

As many of you know, Jack is in Southern California, and has been vital in these the planning stages, but we’ve always known we will need local help with Brewing - with that in mind: we are now seeking local brewers or Brewmaster Apprentices, or Master Brewers - let us know if you have referrals / recommendations!

Our Request for Proposal (RFP) is presently about ready to be circulated to local builders - we always strive to go local - this will give us the ability to better compare similar proposals and bids, which all have the same structure, line items, and commitments, to better choose a partner for the build, going forward.

Construction Funding, Scheduling, Resources

The Construction loan will provide the bulk of the funding for the project buildout, typically 80-90%.

That said, lenders typically require a ~15-20% contingency, alongside their investment, during construction. This provides an allowance for unforeseen or unbudgeted expenses, which are not not listed elsewhere as line items in the Business Plan. These cash reserves need to be shown as available, either in the bank or on statements, before or during loan applications.

In the package to lenders, we will include the contractor bids and business plan, and expect financing proposals from them. Once a funder is chosen, finalized and funded, we will then be able to start construction immediately.

Regarding the resources we need, in addition to the cash reserves, recent delays have of course had costs associated with them, and the new septic system has added considerable expense (and additional permit expenses, since the septic is a separate permit).

Community Response, Buzz, Benefactors, Investors

• We have had universally positive and enthusiastic reaction from everyone in the community to our commitment to reinstate the iconic Brewery and meeting place anchoring the downtown Boulder Creek area.

• The local media has given us positive, encouraging, ongoing coverage of our saga / journey / struggle to reopen.

• We have also had outreach from many local owners / Brewmasters / other involved local industry veterans - some of whom previously worked at the brewery - all of whom have pledged their support and enthusiasm for our reopening!

• You can be a part of the rebirth of the iconic Boulder Creek Brewing company - benefactors and investors such as yourselves are vital to our success and to a timely reopening

• The headwinds have been formidable, but we can now see a light at the end of the tunnel, with a likely increased seating capacity and therefore higher potential revenue.

We can accept contributions in different forms, depending on your goals and amount:

Smaller Investments / Donations

Can easily be done online:

Patreon: https://patreon.com/BoulderCreekBrewingCo

PayPal: https://paypal.me/BoulderCreekBrewing

We are also relaunching our GoFundMe campaign, and close to releasing our IndieGogo campaign - Let us know if you prefer either of these, or if there’s another platform you like.

Larger investments / Equity ownership

We are offering Convertible Notes, which convert directly to shares of equity at the next major funding event, such as the Construction Loan Funding.

If you’re looking to purchase equity, reply and ask about our Convertible Notes offering; ask any questions you have, and we will send you the Convertible Notes paperwork package.

In Conclusion

• We’ve had some delays, but have now crossed a huge milestone and are back on track moving forward.

• We are now submitting plans and Change Order responses, and ramping back up with the Business Plan, Builders / RFPs, and Construction scheduling.

• We need your ongoing help and support going forward to complement the construction loan funding.

• We all look forward to the Reopening, now targeted for late summer / fall 2025!

Best regards,
Joe

Managing Member
Detailed Development LLC
Boulder Creek Brewing Co
joe@bouldercreekbrewing.com