[Federal Register Volume 60, Number 246 (Friday, December 22, 1995)]
[Proposed Rules]
[Pages 66535-66538]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31169]



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DEPARTMENT OF THE TREASURY
Bureau of Alcohol, Tobacco and Firearms

27 CFR Part 9

RIN 1512-AA07
[Notice No. 817]


The Malibu-Newton Canyon Viticultural Area (95R-014P)

AGENCY: Bureau of Alcohol, Tobacco and Firearms, Department of the 
Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Bureau of Alcohol, Tobacco and Firearms (ATF) has received 
a petition proposing the establishment of a viticultural area in the 
State of California to be known as ``Malibu-Newton Canyon.'' This 
proposal is the result of a petition submitted by Mr. George Rosenthal, 
President of Rancho Escondido, Inc.
    ATF believes that the establishment of viticultural area names as 
appellations of origin in wine labeling and advertising allows wineries 
to designate the specific areas where the grapes used to make the wine 
were grown and enables consumers to better identify the wines they 
purchase.

DATES: Written comments must be received by February 20, 1996.

ADDRESSES: Send written comments to: Chief, Wine, Beer and Spirits 
Regulations Branch, Bureau of Alcohol, Tobacco and Firearms, P.O. Box 
50221, Washington, DC 20091-0221 (Attn: Notice No. 817). Copies of the 
petition, the proposed regulations, the appropriate maps, and any 
written comments received will be available for public inspection 
during normal business hours at: ATF Reading Room, Office of Public 
Affairs and Disclosure, Room 6480, 650 Massachusetts Avenue, NW, 
Washington, DC.

FOR FURTHER INFORMATION CONTACT: David Brokaw, Wine, Beer and Spirits 
Regulations Branch, Bureau of Alcohol, Tobacco and Firearms, 650 
Massachusetts Avenue, NW., Washington, DC 20226 (202-927-8230).

SUPPLEMENTARY INFORMATION:

Background

    On August 23, 1978, ATF published Treasury Decision ATF-53 (43 FR 
37672, 54624) revising regulations in 27 CFR Part 4. These regulations 
allow the establishment of definitive viticultural areas. The 
regulations allow the name of an approved viticultural area to be used 
as an appellation of origin on wine labels and in wine advertisements. 
On October 2, 1979, ATF published Treasury Decision ATF-60 (44 FR 
56692) which added a new Part 9 to 27 CFR, for the listing of approved 
American viticultural areas.
    Section 4.25a(e)(1), Title 27 CFR, defines an American viticultural 
area as a delimited grape-growing region distinguishable by 
geographical features, the boundaries of which have been delineated in 
Subpart C of Part 9.
    Section 4.25a(e)(2) outlines the procedure for proposing an 
American viticultural area. Any interested person may petition ATF to 
establish a grape-

[[Page 66536]]
growing region as a viticultural area. The petition should include:
    (a) Evidence that the name of the proposed viticultural area is 
locally and/or nationally known as referring to the area specified in 
the petition;
    (b) Historical or current evidence that the boundaries of the 
viticultural area are as specified in the petition;
    (c) Evidence relating to the geographical features (climate, soil, 
elevation, physical features, etc.) which distinguish the viticultural 
features of the proposed area from surrounding areas;
    (d) A description of the specific boundaries of the viticultural 
area, based on the features which can be found on United States 
Geological Survey (U.S.G.S.) maps of the largest applicable scale; and
    (e) A copy of the appropriate U.S.G.S. map(s) with the boundaries 
prominently marked.

Petition

    ATF has received a petition from Mr. George Rosenthal, President of 
Rancho Escondido, Inc., proposing to establish a new viticultural 
appellation in the Malibu area of Los Angeles County, California, to be 
known as ``Malibu-Newton Canyon.'' The viticultural area, comprising 
approximately 850 acres, is located within Newton Canyon which is a 
bowl shaped valley located on the south facing side of the Santa Monica 
Mountains. Vineyards currently within the proposed viticultural area 
are located on the Rancho Escondido Estate. Rancho Escondido is 
comprised of approximately 157 acres, all of which lies within the 
proposed ``Malibu-Newton Canyon'' viticultural area. Approximately, 14 
of these acres are planted with premium wine producing vineyards. 
Varietals include Cabernet Savignon, Merlot, Cabernet Franc, Chardonnay 
and Petite Verdot. Currently, there are no wineries located within the 
proposed ``Malibu-Newton Canyon'' area. The petition provides the 
following information as evidence that the proposed area meets the 
regulatory requirements discussed previously.

Evidence That the Name of the Area Is Locally or Nationally Known

    According to the petitioner, the origin of the name Malibu comes 
from the ancient Chumash Indian word MALA I BOO, meaning ``Place on the 
Cliff,'' and was the name of an Indian village just beyond Malibu 
Beach. After the Spaniards took control of southern California, the 
encompassing Chumash ranchera UMALIBO became known as the Malibu 
Rancho. A Spanish settler, Jose Bartolome Tapia gained control of the 
rancho and was later granted the land by the Governor of the 
Californias. The present day spelling appears on the name of the 
Topanga Malibu Sequit grant dated July 12, 1805. It originally totalled 
13,315 acres, one of the largest southern California Ranchos at that 
time.
    The petitioner further states that throughout the 19th century, 
Rancho Malibu changed hands many times but remained intact. Until the 
construction of the Pacific Coast Highway in the 1930's, the privacy of 
Rancho Malibu had not been invaded. With the burgeoning economy of 
southern California, conditions greatly changed. This historic rancho 
was finally subdivided during the same decade. Following soon after, 
the famous Malibu Beach Colony was established where movie stars and 
industry moguls began constructing their homes. The Malibu area then 
quickly developed into the highly recognized community of Los Angeles 
as it is known today.
    Throughout this region there exists topography in the form of 
roads, a creek, a lake, a canyon, a beach, hiking trails, parks, 
vistas, etc. which denote the name ``Malibu.'' The region lying roughly 
from the ridge line of the Santa Monica Mountains to the ocean, and 
from Topanga Canyon to the Ventura County line is commonly known as 
Malibu, according to the petitioner. While the city of Malibu was 
incorporated in 1992, the entire surrounding area described above 
continues to be recognized as Malibu. ``Malibu'' could be applied to 
any of the hills/mountains which drain toward the ocean through the 
city of Malibu, including Newton Canyon, the location of the proposed 
viticultural area.
    The petitioner provided a 1:250,000 scale Topopgraphic-Bathymetric 
map of Los Angeles to document the use of the name, ``Malibu.'' An 
article in the October 15, 1994, issue of the ``Wine Spectator,'' 
entitled ``A Vineyard Grows in Malibu Canyon,'' refers to the area 
around ``The Malibu Estate'' (Rancho Escondido, Inc.) as ``Malibu 
Hills.'' Also, included as an exhibit was a copy of an article from, 
``The Underground Wine Journal,'' 1994, entitled, ``Distinctive New 
Wines.'' This article refers to ``The Malibu Estate'' as being located 
``in the hills above Malibu.''
    According to the petitioner, the name ``Newton Canyon'' is 
generally known as describing the specific area in which the proposed 
viticultural area is located. This is evidenced by the name of the main 
street running through the proposed viticultural area--``Newton Canyon 
Road.'' In addition, maps of the area, including the U.S.G.S. map 
referenced and shown within the petition, label the area as, ``Newton 
Canyon.'' The petitioner states that, ``'Newton Canyon alone is not 
descriptive enough to describe the general location of the proposed 
viticultural area, and further, might possibly cause public confusion 
in relation to Newton Vineyards, located in the Napa Valley.'' 
Therefore, the petitioner proposed the name, ``Malibu-Newton Canyon.''

Historical or Current Evidence That the Boundaries of the Proposed 
Viticultural Area Are as Specified in the Petition

    The boundaries of the proposed ``Malibu-Newton Canyon'' 
viticultural area follow the natural ridge lines which define Newton 
Canyon and are delineated on the U.S.G.S. Point Dume, California, 
quadrangle map.
    Newton Canyon is a bowl shaped valley located on the south facing 
side of the Santa Monica Mountains, in the Malibu area of Los Angeles 
County. The canyon is oriented along an east-west axis. The valley 
floor lies at an elevation of approximately 1,400 feet. The surrounding 
ridgeline ranges in elevation from 1,800-2,100 feet on the southern 
ocean side of the canyon, continuing to 2,100-2,800 feet on the high 
side of the canyon to the north.
    According to the petitioner, the elevation of the southern rim of 
the canyon is low enough to allow evening fog to sift into the valley, 
but high enough to keep out the marine layer that shrouds much of the 
coastline throughout the daytime. The northern rim of the canyon joins 
the crest of the Santa Monica Mountains that divides oceanside from 
leeside. Lying at the eastern most side of the canyon, Castro Peak is 
another distinguishing feature which marks one of the highest points in 
the Santa Monica Mountains at 2,824 feet.
    The petitioner further states that approximately two-thirds of the 
surrounding Malibu area contains slopes greater than 25 percent, with 
only one-fifth having relatively level terrain. Throughout the past 
several decades, most of the usable land in the Malibu area has been 
developed. Because of increasingly high land prices, very little of the 
land in the general Malibu area is still used for agriculture. The 
Santa Monica Mountains also have thousands of acres dedicated to State 
and national parks, with more acreage being aggressively acquired by 
public conservation agencies. 

[[Page 66537]]


Evidence Relating to the Geographical Features (Climate, Soil, 
Elevation, Physical Features, etc.) Which Distinguish the Viticultural 
Features of the Proposed Area From Surrounding Areas

Climate

    Based upon a 1994 climate study completed by Fox Weather, Oxnard, 
California, the petitioner asserts the following: The general climate 
of the Malibu area is typical of southern California with mild rainy 
winters, and warm dry summers. However, there are several 
climatological factors which distinguish the proposed ``Malibu-Newton 
Canyon'' viticultural area from the surrounding region.
    While summer temperatures often exceed 80 degrees in the afternoon, 
cooling ocean breezes flow into the valley in the evening, according to 
the petitioner. Moreover, during the evening and early morning a light 
fog often filters into the valley and settles along the slopes, 
creating a unique microclimate which is significantly cooler than the 
surrounding inland areas. Typically, the morning sun shines through the 
fog, which in turn is swept out by warm winds and high daytime 
temperatures. The valley enjoys southern exposure to the sun throughout 
the afternoon. According to the petitioner, these conditions are ideal 
for premium grape growing.
    Because of its high elevation and orientation, the proposed 
viticultural area does not experience the constantly overcast skies and 
cooler temperatures of the coastal region immediately below.
    Newton Canyon, within which the proposed viticultural area is 
located, is a unique pocket protected from marine influence. The 
coastline near sea level is a more temperate climate controlled by 
marine stratus with uniformly cold temperatures, fog and low clouds. 
This cooler and more humid coastal environment, mainly affecting areas 
below the 1,300 foot level, can create grape rot and delay maturation.
    The petitioner claims that the proposed ``Malibu-Newton Canyon'' 
viticultural area is, in the daytime, a sunny warm oasis for a coastal 
location. The proposed area is located at an elevation which lies just 
at the bottom of the inversion layer and just at the top of the marine 
layer. Typically, the marine layer ceiling is approximately 1,400 feet 
on average. The southern or bottom rim of the canyon acts as a barrier 
to the marine layer, preventing the bulk of the coastal fog and low 
clouds from penetrating the valley for extended periods of time. This 
allows the ``Malibu-Newton Canyon'' area to enjoy favorable cooling 
effects of the Pacific ocean and have the warm sunny daytime 
temperatures found in the adjacent interior valleys.
    Nearby inland areas experience uniformly hot summer temperatures 
similar to those experienced in the upper elevations on the oceanside 
of the Santa Monica Mountains. However, these inland areas receive 
little or no fog and much less precipitation than the oceanside regime, 
according to the petitioner.
    An additional distinctive aspect is an increasing amount of 
precipitation with increasing elevation. The petitioner states that 
upland weather stations report practically twice the mean precipitation 
of the nearby lowland stations. Furthermore, the greatest monthly 
precipitation during the rainy season is from 1.5 to 3.0 times as great 
as that for the lowland stations. Precipitation is concentrated in the 
winter months. The average annual rainfall is about 24 inches, with 
approximately 12 percent occurring from the months of April to October.
    The proposed area experiences typical low temperatures in the 
winter time, just above freezing temperatures. Infrequent winter 
freezes have been known to occur during the dormant winter growing 
cycle.
    In summary, the petitioner states that the proposed viticultural 
area is characterized by an isolated microclimate that captures the 
favorable climatic conditions necessary for premium wine grape growing. 
In contrast, the petitioner states that the surrounding areas found on 
the oceanside of the Santa Monica Mountains (i.e, Malibu, Oxnard, Santa 
Monica) are uniformly cool and overcast. Surrounding inland areas found 
on the leeside of the Santa Monica Mountains (i.e, Thousand Oaks, 
Agoura, Woodland Hills) are uniformly hot and dry. The petitioner 
provided a diagram illustrating the ``Malibu-Newton Canyon'' 
microclimate and a November 29, 1994, ``CLIMATOLOGICAL SURVEY FOR 
RANCHO ESCONDIDO VINEYARDS,'' by Alan D. Fox of Fox Weather.

Physical Features

    According to the petitioner, the primary distinction of the 
proposed viticultural area is its unique combination of shape, 
elevation, orientation and relative location to the marine influences 
of the Pacific Ocean. The proposed area lies within a clearly defined 
valley with a ``bowl'' shape resting high on the oceanside of the Santa 
Monica Mountains. These physical features create a pocket which harbors 
the distinct microclimate described above. The petitioner provided 
aerial photos to illustrate these physical features.

Drainage

    All of the proposed viticultural area drains into Newton Canyon 
Creek, continuing to Zuma Creek which then drains into the Pacific 
Ocean at Point Dume's westward beach, according to the petitioner.

Soils

    As evidence of soil types, the petitioner provided a 1994 soils 
study completed by Soil & Plant Laboratory, Inc., Orange, California, 
in addition to ``Soils of the Malibu Area California'' published by the 
Soil Conservation Service, United States Department of Agriculture.
    According to this information, major soils within the proposed 
viticultural area range from loam to clay loam in texture. Subsoil 
texture ranges from clay loam to clay. Current plantings are mainly on 
Castaic and Rincon silty clay loams and Malibu loam which are lower 
elevation terrace soils that are moderately deep, with favorable 
Capability Class ratings of II to IV. Steeper hillside soils (mostly 
above the 1,700 foot contour line) are shallower with Capability Class 
ratings ranging from IV to VIII.
    Soils in the proposed viticultural area have moderate to high 
inherent fertility. Soil reaction in surface soils ranges from 
moderately acid to slightly alkaline. Subsoil ph varies with type and 
several areas are calcareous.
    According to the petitioner, soil tests performed prior to the 
planting of vineyards in 1988 revealed that the topsoil found in much 
of lower Newton Canyon contained crushed rock, as a result of the 
construction of the nearby Kanan Dume Road tunnel, which is ideal for 
good drainage.
    The surrounding areas are mainly steep hillsides and mountainous 
uplands with poor soil capability. These soils are usually shallower 
than those found in the proposed viticultural area, and are subject to 
erosion.

Proposed Boundary

    The boundary of the proposed ``Malibu-Newton Canyon'' viticultural 
area may be found on one United States Geological Survey map, entitled 
Point Dume Quadrangle, California, 7.5 minute series, with a scale of 
1:24,000.

Public Participation--Written Comments

    ATF requests comments from all interested parties. Comments 
received 

[[Page 66538]]
on or before the closing date will be carefully considered. Comments 
received after that date will be given the same consideration if it is 
practical to do so. However, assurance of consideration can only be 
given to comments received on or before the closing date.
    ATF will not recognize any submitted material as confidential and 
comments may be disclosed to the public. Any material which a commenter 
considers to be confidential or inappropriate for disclosure to the 
public should not be included in the comments. The name of the person 
submitting a comment is not exempt from disclosure.
    Comments may be submitted by facsimile transmission to (202) 927-
8602, provided the comments: (1) are legible; (2) are 8\1/2\ x 11'' in 
size, (3) contain a written signature, and (4) are 3 pages or less in 
length. This limitation is necessary to assure reasonable access to the 
equipment. Comments sent by FAX in excess of three pages will not be 
accepted. Receipt of FAX transmittals will not be acknowledged. 
Facsimile transmitted comments will be treated as originals.
    During the comment period, any person who desires an opportunity to 
comment orally at a public hearing on the proposed regulation should 
submit his or her request, in writing, to the Director within the 60-
day comment period. However, the Director reserves the right to 
determine, in light of all circumstances, whether a public hearing will 
be held.

Executive Order 12866

    It has been determined that this proposed regulation is not a 
significant regulatory action as defined by Executive Order 12866. 
Accordingly, this proposal is not subject to the analysis required by 
this executive order.

Regulatory Flexibility Act

    It is hereby certified that this proposed regulation will not have 
a significant economic impact on a substantial number of small 
entities. The establishment of a viticultural area is neither an 
endorsement nor approval by ATF of the quality of wine produced in the 
area, but rather an identification of an area that is distinct from 
surrounding areas. ATF believes that the establishment of viticultural 
areas merely allows wineries to describe more accurately the origin of 
their wines to consumers, and helps consumers identify the wines they 
purchase. Thus, any benefit derived from the use of a viticultural area 
name is the result of the proprietor's own efforts and consumer 
acceptance of wines from that area.
    Accordingly, a regulatory flexibility analysis is not required 
because the proposal, if promulgated as a final rule, is not expected 
(1) to have significant secondary, or incidental effects on a 
substantial number of small entities; or (2) to impose, or otherwise 
cause a significant increase in the reporting, recordkeeping, or other 
compliance burdens on a substantial number of small entities.

Paperwork Reduction Act

    The provisions of the Paperwork Reduction Act of 1980, Pub. L. No. 
96-511, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR 
Part 1320, do not apply to this notice of proposed rulemaking because 
no requirement to collect information is proposed.

Drafting Information

    The principal author of this document is David Brokaw, Wine, Beer 
and Spirits Regulations Branch, Bureau of Alcohol, Tobacco and 
Firearms.

List of Subjects in 27 CFR Part 9

    Administrative practices and procedures, Consumer protection, 
Viticultural areas, and Wine.

Authority and Issuance

    Title 27, Code of Federal Regulations, Part 9, American 
Viticultural Areas, is proposed to be amended as follows:

PART 9--AMERICAN VITICULTURAL AREAS

    Par. 1. The authority citation for Part 9 continues to read as 
follows:

    Authority: 27 U.S.C. 205.

Subpart C--Approved American Viticultural Areas

    Par. 2. Subpart C is amended by adding Sec. 9.152 to read as 
follows:
* * * * *


Sec. 9.152  Malibu-Newton Canyon.

    (a) Name. The name of the viticultural area described in this 
petition is ``Malibu-Newton Canyon.''
    (b) Approved maps. The appropriate map for determining the boundary 
of the Malibu-Newton Canyon viticultural area is the U.S.G.S. map, 
``Point Dume Quadrangle, California'' (7.5 Minute Series 1:24,000 
Topographic map, photorevised 1981).
    (c) Boundary. The Malibu-Newton Canyon viticultural area is located 
in Los Angeles County, California. The boundary is as follows:
    (1) Beginning at the intersection of the Newton Canyon creek 
(lowest elevation) and an unnamed medium duty road referred to by the 
petitioner as Kanan Dume Road at the boundary of section 13 and 18 on 
the U.S.G.S. map ``Point Dume Quadrangle.''
    (2) Then south along Kanan Dume Road to the point where an unnamed, 
unimproved dirt road referred to by the petitioner as Ramerez Mountain 
Way crosses over Kanan Dume Road at the tunnel in the northwest corner 
of section 19.
    (3) Then east along Ramerez Mountain Way, following the southern 
ridgeline of Newton Canyon, to Latigo Canyon Road in the southwest 
corner of section 17.
    (4) Then south along Latigo Canyon Road to an unnamed, unimproved 
dirt road referred to by the petitioner as Newton Mountain Way at the 
southern boundary of section 17.
    (5) Then northeast along Newton Mountain Way, following the 
southeastern ridgeline of Newton Canyon, to an unnamed, unimproved dirt 
road referred to by the petitioner as Castro Mountain Way in section 
16.
    (6) Then west along Castro Mountain Way, past Castro Peak, 
following the northern ridgeline of Newton Canyon to Latigo Canyon Road 
in section 18.
    (7) Then southwest along the natural ridgeline of Newton Canyon to 
the intersection of Kanan Dume Road and the 1,600 foot contour line in 
the southeastern portion of section 13.
    (8) Then southeasterly along Kanan Dume Road to the beginning 
point.

    Signed: December 11, 1995.
Daniel R. Black,
Acting Director.
[FR Doc. 95-31169 Filed 12-21-95; 8:45 am]
BILLING CODE 4810-31-P