[Federal Register Volume 69, Number 124 (Tuesday, June 29, 2004)]
[Rules and Regulations]
[Pages 38834-38837]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-14652]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[T.D. TTB-14; Re: Notice No. 8]
RIN 1513-AA28


San Bernabe and San Lucas Viticultural Areas (2001R-170P)

AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.

ACTION: Final rule; Treasury decision.

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SUMMARY: This Treasury decision establishes the San Bernabe 
viticultural area and realigns the existing San Lucas viticultural 
area. Both viticultural areas are within the Monterey viticultural area 
in Monterey County, California, and within California's multi-county 
Central Coast viticultural area. The establishment of viticultural 
areas allows vintners to describe more accurately where their wines 
come from and enables consumers to better identify the wines they 
purchase.

EFFECTIVE DATE: August 30, 2004.

FOR FURTHER INFORMATION CONTACT: N. A. Sutton, Program Manager, 
Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade 
Bureau, 6660 Delmonico Dr., D422, Colorado Springs, CO 80919; 
telephone 415-271-1254.

SUPPLEMENTARY INFORMATION: 

Background on Viticultural Areas

TTB Authority

    The Federal Alcohol Administration Act (FAA Act) at 27 U.S.C. 
205(e) requires that alcohol beverage labels provide the consumer with 
adequate information regarding a product's identity, while prohibiting 
the use of misleading information on such labels. The FAA Act also 
authorizes the Secretary of the Treasury to issue regulations to carry 
out the Act's provisions. The Alcohol and Tobacco Tax and Trade Bureau 
(TTB) administers these regulations.
    Regulations in 27 CFR Part 4, Labeling and Advertising of Wine, 
allow the establishment of definitive viticultural areas and the use of 
their names as appellations of origin on wine labels and in wine 
advertisements. Title 27 CFR Part 9, American Viticultural Areas, 
contains the list of approved viticultural areas.

Definition

    Title 27 CFR 4.25(e)(1) defines an American viticultural area as a 
delimited grape-growing region distinguishable by geographic features 
whose boundary has been delineated in subpart C of part 9. The 
establishment of viticultural areas allows the identification of 
regions where a given quality, reputation, or other characteristics of 
the wine is essentially attributable to its geographic origin. The 
establishment of viticultural areas allows vintners to describe more 
accurately the origin of their wines to consumers and helps consumers 
to identify the wines they purchase. Establishment of a viticultural 
area is neither an approval nor endorsement by TTB of the wine produced 
there.

Requirements

    Section 4.25(e)(2) outlines the procedure for proposing an American 
viticultural area. Anyone interested may petition TTB to establish a 
grape-growing region as a viticultural area. The petition must 
include--
     Evidence that the proposed viticultural area is locally 
and/or nationally known by the name specified in the petition;
     Historical or current evidence that the boundaries of the 
proposed viticultural area are as specified in the petition;
     Evidence relating to the geographical features, such as 
climate, soils, elevation, physical features, etc., that distinguish 
the proposed area from surrounding areas;
     A description of the proposed viticultural area's specific 
boundaries, based on features found on maps approved by the United 
States Geological Survey (USGS); and
     A copy of the appropriate USGS map(s) with the boundaries 
prominently marked.
    A petition requesting the modification of an established 
viticultural area must include the appropriate evidence and maps as 
described above to support the requested modification(s).

Impact on Current Wine Labels

    Part 4 of the TTB regulations prohibits any label reference on a 
wine that suggests an origin other than the wine's true place of 
origin. With certain exceptions, the regulations also prohibit the use 
of brand names of viticultural significance, such as the name of a 
State, county, or viticultural area, unless the wine meets the 
appellation of origin requirements for the named geographic area.
    With the establishment of the ``San Bernabe'' viticultural area, 
its name, like that of the existing ``San Lucas'' viticultural area, 
becomes a term of viticultural significance. Wine bottlers using ``San 
Bernabe'' or ``San Lucas'' in a brand name, including a trademark, or 
in another label reference, must ensure the product is eligible to use 
that viticultural area's name as an appellation of origin.
    For a wine to be eligible to use a viticultural area name listed in 
part 9 of the TTB regulations as an appellation of origin, at least 85 
percent of the grapes used to make the wine must have been grown within 
that viticultural area. If the wine is not eligible to use the 
viticultural area name and that name appears in the wine's brand name 
or in another label reference, the label is not in compliance and the 
bottler must change the brand name or other label reference and obtain 
approval of a new label.
    Different rules apply if a wine has a brand name containing a 
viticultural area name that was used as a brand name on a label 
approved before July 7, 1986. See 27 CFR 4.39(i) for details.

San Bernabe and San Lucas Petitions

    We received two petitions from Claude Hoover of Delicato Family 
Vineyards, Monterey, California, proposing the establishment of a new 
viticultural area to be named San Bernabe, and the realignment of the 
adjacent, established San Lucas viticultural area (27 CFR 9.56). Both 
viticultural areas are located in the Salinas Valley in central 
Monterey County, California. The two areas are within the Monterey 
viticultural area (27 CFR 9.98) and the multi-county Central Coast 
viticultural area (27 CFR 9.75).
    The San Bernabe viticultural area encompasses 24,796 acres of 
predominantly rolling hills with sandy soils and 7,636 acres of 
vineyards. The realignment of the San Lucas viticultural area transfers 
1,281 acres of rolling, sandy land from the northwestern San Lucas area 
to the southern San Bernabe area. This realignment avoids splitting a 
large vineyard between the two viticultural areas, prevents overlapping 
boundary lines between the two viticultural areas, and creates one 
common boundary line between the San Bernabe viticultural area and the 
San Lucas viticultural area.

[[Page 38835]]

Name Evidence

    According to the 1991 publication of ``Monterey County Place Names, 
A Geographical Dictionary,'' by Donald Thomas Clark, Father Pedro Font, 
a member of the California expedition of Spanish explorer DeAnza, 
documented the initial reference to San Bernabe on March 8, 1776. He 
wrote in his diary, ``we had passed a spur of the Sierra de Santa Lucia 
* * *. The road at first runs through a spur of mountains, until it 
descends to a wide valley called the Ca[ntilde]ada de San Bernabe.'' 
Eventually the area became known as ``Rancho San Bernabe.''
    The Thompson Canyon and San Lucas USGS quadrangle maps prominently 
identify the area as San Bernabe. The relevant Thomas Guide labels this 
area Rancho San Bernabe. The TopoZone map Web site identifies this 
rural area as San Bernabe.
    The 13,000-acre San Bernabe vineyard estate, owned by Delicato 
Family Vineyards, has 7,636 acres planted to grapes and sits almost 
entirely within the new viticultural area. A small portion of the 
vineyard estate, outside the San Bernabe viticultural area boundaries, 
is unplanted and unsuitable for grape cultivation. According to the 
Delicato Family Vineyards petition, the San Bernabe vineyard estate is 
recognized as the largest continuous vineyard estate under a single 
ownership in the free world.

Boundary Evidence

    According to the 1991 ``Monterey County Place Names, A Geographical 
Dictionary,'' the San Bernabe area land grants were given to Jesus 
Molina in 1841 and in 1842 to Petronillo Rios. In 1842 Rios bought the 
Molina land grant and the Rios family began raising cattle and crops on 
this land and producing wine from their own grapes. The Rios ranch, 
known as Rancho San Bernabe, eventually became a successful vineyard 
and wine producing property.
    In the 1970s Prudential-Southdown purchased the San Bernabe acreage 
for vineyard development. In 1988 the Delicato family bought the San 
Bernabe vineyard for its premium and super-premium wine market 
potential. The San Bernabe vineyard estate occupies 52 percent of the 
viticultural area of the same name.
    The San Bernabe viticultural area boundary line connects 
benchmarks, mountain peaks, and other U.S.G.S. map geographical 
features by using straight lines and several roads that follow the 
hilly terrain and soil changes.
    The San Bernabe viticultural area shares portions of its west and 
southwest boundary lines with the surrounding Monterey viticultural 
area, which is, in turn, surrounded by the multi-county Central Coast 
viticultural area. The San Bernabe viticultural area shares its south 
boundary line with the realigned San Lucas viticultural area's 
northwestern boundary. The transfer of 1,281 acres of the San Lucas 
viticultural area to the San Bernabe viticultural area helps to better 
define the geographical differences between the established San Lucas 
area and the new San Bernabe area while preventing the split of an 
existing vineyard between the two viticultural areas.

Growing Conditions

Topography
    The San Bernabe viticultural area is located immediately south of 
King City in the long Salinas Valley. The approximately 9-mile-long and 
7-mile-wide viticultural area occupies the valley floor and rolling 
foothills, extending west from the Salinas River to the Santa Lucia 
Mountains. Unique viticultural qualities of the San Bernabe area 
include its climate, water quality, wind-produced eolian soils, and 
rolling hills. The 1,281 acres realigned from the San Lucas 
viticultural area possess similar eolian soils, rolling hills 
topography, and irrigation water quality as found in the new San 
Bernabe viticultural area.
Soils
    In the San Bernabe viticultural area, grapes are grown below the 
700-foot elevation level on rolling hills in wind-produced eolian 
soils. The Oceano, Garey, and Garey-Oceano complex eolian soil types, 
which are well to excessively well-drained, dominate the San Bernabe 
viticultural area. Small niches of alluvial soils, derived from the 
shale-based Santa Lucia Mountains, lie within the area and immediately 
to the north and south of the San Bernabe boundary lines.
    The larger, surrounding Monterey viticultural area consists of only 
1.6 percent eolian soils, and the alluvial Lockwood series soils 
dominate the adjacent San Lucas viticultural area. The realignment area 
possesses a predominance of the wind-produced eolian soils that 
contrast to the alluvial type soils of the San Lucas area. Above and 
west of the 700-foot contour line, the soils are derived from the 
shale-based Santa Lucia Mountains. The bench soils along the east 
boundary are common to the Salinas River area. East of the San Bernabe 
viticultural area boundary line, the Gabilan Mountain Range includes 
calcareous sandstone, shale, and siltstone, which come from a different 
source material, according to the petitioner.
Climate
    The Salinas Valley forms a broad funnel for the strong, cool, 
afternoon marine winds coming off Monterey Bay during the warm months. 
The winds are drawn inland and south through the Salinas Valley by 
rising warm air that moderates the valley's high and low temperatures 
to varying degrees, producing a graduated effect in the valley. As a 
result, the San Bernabe area is warmer than viticultural areas to the 
north, and closer to Monterey Bay, and cooler than the adjoining San 
Lucas viticultural area to the immediate south.
    The winds dissipate gradually as they travel inland from Monterey 
Bay and create a series of temperature-unique, grape-growing areas 
within the long Salinas Valley. San Bernabe, at 60 miles south of the 
Monterey Bay, averages a 30-degree daily temperature variation, while 
Salinas, at 17 miles from the Monterey Bay, averages a smaller 18-
degree daily temperature variation.
    The cool night air helps retain the grapes' acid and color, while 
the daily heat encourages ripeness and flavor. The San Bernabe area 
averages 30 frost-days annually, while Salinas, closer to Monterey Bay, 
averages only four frost-days.
    More rain falls at the Salinas Valley's extreme north and south 
ends, with less falling in the region between, which includes the San 
Bernabe viticultural area. At the valley's north end, the city of 
Salinas averages 17.5 inches of annual rainfall, and, at the valley's 
south end, Paso Robles averages 19 inches. The San Bernabe area, 
between the two ends, averages only 13 inches of annual rainfall.
Water Resources
    Irrigation water is used extensively in the San Bernabe 
viticultural area's vineyards. The water comes from area reservoirs and 
contains only small amounts of carbonates and nitrates, which benefits 
the grapevines and soil. Toward the Monterey Bay, water quality 
declines as nitrate and carbonate levels increase.

Notice of Proposed Rulemaking

Comments

    TTB published a notice of proposed rulemaking regarding the 
establishment of the San Bernabe viticultural area and the realignment 
of the San Lucas viticultural area in the May 14, 2003, Federal 
Register as Notice No. 8 (68 FR 25851). In that notice, TTB requested

[[Page 38836]]

comments by July 14, 2003, from all interested persons. No comments 
were received in response to this Notice No. 8.

TTB Finding

    TTB finds that the evidence submitted with the petition supports 
the establishment of the proposed San Bernabe viticultural area and the 
realignment of the existing San Lucas viticultural area. Therefore, 
under the authority of the Federal Alcohol Administration Act and part 
4 of our regulations, we establish the San Bernabe viticultural area 
and realign the San Lucas viticultural area as described in this final 
rule, effective 60-days from this document's publication.

Regulatory Analyses and Notices

Regulatory Flexibility Act

    We certify that this rule will not have a significant economic 
impact on a substantial number of small entities. This rule imposes no 
new reporting, recordkeeping, or other administrative requirement. Any 
benefit derived from the use of a viticultural area name would be the 
result of a proprietor's efforts and consumer acceptance of wines from 
that area. Therefore, no regulatory flexibility analysis is required.

Executive Order 12866

    This rule is not a significant regulatory action as defined by 
Executive Order 12866, 58 FR 51735. Therefore, it requires no 
regulatory assessment.

Drafting Information

    The principal author of this document is N.A. Sutton (Colorado) 
Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade 
Bureau.

List of Subjects in 27 CFR Part 9

    Wine.

Authority and Issuance

0
For the reasons discussed in the preamble, we amend 27 CFR, chapter 1, 
part 9 as follows:

PART 9--AMERICAN VITICULTURAL AREAS

0
1. The authority citation for part 9 continues to read as follows:


    Authority: 27 U.S.C. 205.

Subpart C--Approved American Viticultural Areas

0
2. Amend Sec.  9.56 to revise paragraphs (c)(24) and (c)(25) and add 
paragraphs (c)(26) and (c)(27) to read as follows:


Sec.  9.56  San Lucas.

* * * * *
    (c) Boundary. * * *.
* * * * *
    (24) Then northeasterly approximately 1.3 miles to the 595-foot 
promontory, section 13, T21S, R8E (Espinosa Canyon Quadrangle);
    (25) Then northeasterly approximately 0.6 mile to the intersection 
of a meandering, unnamed, light duty road and the fork of an 
intermittent stream, then continue meandering northeasterly, followed 
by southeasterly, approximately 1.1 miles to its intersection with an 
unnamed, light duty road south of the windmill, T21, R8E (Espinosa 
Canyon Quadrangle);
    (26) Then northeasterly along the unnamed road approximately 0.6 
mile to its intersection with the Salinas River, then continue 0.8 mile 
north in a straight line to benchmark 340, between U.S. Highway 101 and 
the Salinas River, in T21S, R9E (San Lucas Quadrangle);
    (27) Then approximately 0.4 mile northwesterly in a straight line 
to the intersection with a water tank, then continues northeasterly in 
a straight line approximately 0.7 mile, and return to the point of 
beginning in the northwest corner of section 5, in T21S, R9E (San Lucas 
Quadrangle).

0
3. Subpart C is amended by adding Sec.  9.171 to read as follows:


Sec.  9.171  San Bernabe.

    (a) Name. The name of the viticultural area described in this 
section is ``San Bernabe''.
    (b) Approved Maps. The appropriate maps for determining the 
boundary of the San Bernabe viticultural area are four 1:24,000 scale, 
USGS topographic maps. They are titled:
    (1) Thompson Canyon Quadrangle, California-Monterey County, 1949 
(photorevised 1984);
    (2) San Lucas Quadrangle, California-Monterey County, 1949 
(photorevised 1984);
    (3) Espinosa Canyon Quadrangle, California-Monterey County, 1949 
(photorevised 1979); and
    (4) Cosio Knob Quadrangle, California-Monterey County, 1949 
(photorevised 1984);
    (c) Boundary. The San Bernabe viticultural area is located in 
central Monterey County, south of King City, California, and west of 
U.S. Highway 101.
    (1) The point of beginning on the Thompson Canyon Quadrangle is 
benchmark 304, located one-half mile southwest of King City, along the 
Salinas River, in Township 20 South (T20S) and Range 8 East (R8E). 
Proceed southeast in a straight line for 2.35 miles to benchmark 304, 
at the intersection of a trail and the 300-foot contour line, between 
U.S. Highway 101 and the Salinas River, in T20S and R8E (San Lucas 
Quadrangle); then
    (2) Proceed southeast in a straight line for 2.9 miles to benchmark 
336, between U.S. Highway 101 and the Salinas River, in T20S and R8E 
(San Lucas Quadrangle); then
    (3) Proceed southeast in a straight line for 3 miles to benchmark 
340, between U.S. Highway 101 and the Salinas River, in T21S and R9E 
(San Lucas Quadrangle); then
    (4) Proceed south in a straight line for 0.8 mile to the 
intersection of the Salinas River and the Highway 198 bridge, in T21S 
and R9E (Espinosa Canyon Quadrangle); then
    (5) Proceed southwest along Highway 198 for 0.6 mile to its 
intersection with an unnamed light duty road, in T21S and R9E (Espinosa 
Canyon Quadrangle); then
    (6) Proceed northwest, followed by southwest, about 1.2 miles along 
the meandering, unnamed, light duty road to its intersection with the 
fork of an intermittent stream, in T21S and R8E (Espinosa Canyon 
Quadrangle); then
    (7) Proceed southwest in a straight line for 0.6 mile to the 595-
foot peak, Section 13, in T21S and R8E (Espinosa Canyon Quadrangle); 
then
    (8) Proceed southwest in a straight line for 1.3 miles to the 788-
foot peak, section 23, in T21S and R8E (Espinosa Canyon Quadrangle); 
then
    (9) Proceed southwest in a straight line for 0.7 mile to the 
intersection of the unimproved road and jeep trail, east of the 73-
degree longitudinal line, section 26, in T21S and R8E (Espinosa Canyon 
Quadrangle); then
    (10) Proceed northwest in a straight line for 3.2 miles to the 
northwest corner of section 16, in T21S and R8E (Espinosa Canyon 
Quadrangle); then
    (11) Proceed southwest in a straight line for 1.5 miles to the 
northeast corner of section 19, in T21S and R8E (Cosio Knob 
Quadrangle); then
    (12) Proceed southwest in a straight line for 2.2 miles to the 
southwest corner of section 24, in T21S and R7E (Cosio Knob 
Quadrangle); then
    (13) Proceed north in a straight line for 2 miles to the northwest 
corner of section 13, in T21S and R7E (Cosio Knob Quadrangle); then
    (14) Proceed east in a straight line for 1 mile to the northeast 
corner of section 13, in T21S and R7E (Cosio Knob Quadrangle); then

[[Page 38837]]

    (15) Proceed north in a straight line for 2 miles, along the R7E 
and R8E common boundary line, to the northwest corner of section 6, in 
T21S and R8E (Thompson Canyon Quadrangle); then
    (16) Proceed east in a straight line for 0.1 mile to the southwest 
corner of section 31 and continue diagonally to the northeast corner of 
section 31, in T20S and R8E (Thompson Canyon Quadrangle); then
    (17) Proceed west in a straight line for 2 miles to the southwest 
corner of section 25, in T20S and R7E (Thompson Canyon Quadrangle); 
then
    (18) Proceed due north in a straight line for 0.1 mile to the 
intersection with a light duty road, named Pine Canyon Road, in section 
25, and continue northeast along that road for 3.2 miles to its 
intersection with an unnamed secondary highway, north of benchmark 337, 
section 18, in T20S and R8E (Thompson Canyon Quadrangle); then
    (19) Proceed northwest along the unnamed secondary highway for 0.3 
mile to its intersection with U.S. Highway 101, in T20S and R8E 
(Thompson Canyon Quadrangle); then
    (20) Proceed northeast along U.S. Highway 101 for 0.7 mile to 
benchmark 304, returning to the point of beginning (Thompson Canyon 
Quadrangle).

    Signed: April 26, 2004.
Arthur J. Libertucci,
Administrator.

    Approved: May 26, 2004.
Timothy E. Skud,
Deputy Assistant Secretary, (Tax, Trade, and Tariff Policy).
[FR Doc. 04-14652 Filed 6-28-04; 8:45 am]
BILLING CODE 4810-31-P