[Federal Register Volume 70, Number 21 (Wednesday, February 2, 2005)]
[Proposed Rules]
[Pages 5393-5397]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-1875]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[Notice No. 32]
RIN: 1513-AA90


Proposed Establishment of the Covelo Viticultural Area (2003R-
412P)

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

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau proposes to 
establish the 38,000-acre ``Covelo'' viticultural area in Mendocino 
County, California, about 150 miles north of San Francisco. We 
designate viticultural areas to allow vintners to better describe the 
origin of their wines and to allow consumers to better identify wines 
they may purchase. We invite comments on this proposed addition to our 
regulations.

DATES: We must receive written comments on or before April 4, 2005.

ADDRESSES: You may send comments to any of the following addresses:
     Chief, Regulations and Procedures Division, Alcohol and 
Tobacco Tax and Trade Bureau, Attn: Notice No. 32, P.O. Box 14412, 
Washington, DC 20044-4412.
     202-927-8525 (facsimile).
     [email protected] (e-mail).
     http://www.ttb.gov/alcohol/rules/index.htm. An online 
comment form is posted with this notice on our Web site.
     http://www.regulations.gov (Federal e-rulemaking portal; 
follow instructions for submitting comments).
    You may view copies of this notice, the petition, the appropriate 
maps, and any comments we receive about this proposal by appointment at 
the TTB Library, 1310 G Street, NW., Washington, DC 20220. To make an 
appointment, call 202-927-2400. You may also access copies of the 
notice and comments online at http://www.ttb.gov/alcohol/rules/index.htm.
    See the Public Participation section of this notice for specific 
instructions and requirements for submitting comments, and for 
information on how to request a public hearing.

FOR FURTHER INFORMATION CONTACT: N. A. Sutton, AVA Program Manager, 
Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade 
Bureau, 925 Lakeville Street, No.158, Petaluma, CA 94952; telephone 
415-271-1254.

SUPPLEMENTARY INFORMATION: 

Background on Viticultural Areas

TTB Authority

    Section 105(e) of the Federal Alcohol Administration Act (the FAA 
Act, 27 U.S.C. 201 et seq.) requires that alcohol beverage labels 
provide the consumer with adequate information regarding a product's 
identity and prohibits the use of misleading information on those 
labels. The FAA Act also authorizes the Secretary of the Treasury to 
issue regulations to carry out its provisions. The Alcohol and Tobacco 
Tax and Trade Bureau (TTB) administers these regulations.
    Part 4 of the TTB regulations (27 CFR part 4) allows the 
establishment of definitive viticultural areas and the use of their 
names as appellations of origin on wine labels and in wine 
advertisements. Part 9 of the TTB regulations (27 CFR part 9) contains 
the list of approved viticultural areas.

Definition

    Section 4.25(e)(1)(i) of the TTB regulations (27 CFR 4.25(e)(1)(i)) 
defines a viticultural area for American wine as a delimited grape-
growing region distinguishable by geographical features, the boundaries 
of which have been recognized and defined in part 9 of the regulations. 
These designations allow vintners and consumers to attribute a given 
quality, reputation, or other characteristic of a wine made from grapes 
grown in an area 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 
wines they may purchase. Establishment of a viticultural area is 
neither an approval nor an endorsement by TTB of the wine produced in 
that area.

Requirements

    Section 4.25(e)(2) of the TTB regulations outlines the procedure 
for proposing an American viticultural area and provides that any 
interested party may petition TTB to establish a grape-growing region 
as a viticultural area. Section 9.3(b) of the TTB regulations requires 
the petition to 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 supports setting the 
boundary of the proposed viticultural area as the petition specifies;

[[Page 5394]]

     Evidence relating to the geographical features, such as 
climate, elevation, physical features, and soils, that distinguish the 
proposed viticultural area from surrounding areas;
     A description of the specific boundary of the proposed 
viticultural area, based on features found on United States Geological 
Survey (USGS) maps; and
     A copy of the appropriate USGS map(s) with the proposed 
viticultural area's boundary prominently marked.

Covelo Petition

    Ralph Carter of Sonoma, California, submitted a petition to 
establish the ``Covelo'' viticultural area in northern Mendocino 
County, California. The proposed Covelo area is about 150 miles north 
of San Francisco and 45 miles north of Ukiah. The proposed boundary 
encompasses Round Valley, Williams Valley, and the surrounding 
foothills. The small, rural town of Covelo lies within Round Valley, 
and a portion of the Round Valley Indian Reservation overlaps the 
proposed area's northern end.
    This 38,000-acre area currently has 2 acres of planted grape vines, 
with the potential for more vineyard development in the valley and on 
the surrounding hillsides, according to the petition. The petition does 
not document a history of grape growing in the proposed area.
    According to the petition, the bowl-shaped basin of Round Valley, 
which lies within the proposed Covelo viticultural area, is distinctly 
different from the long, narrow valleys more commonly found in 
Mendocino County. In addition, the petition notes that the soils in the 
proposed Covelo area are, for the most part, very deep, nearly level 
loam, which differ significantly from the soils in the surrounding 
areas. The proposed Covelo area has a shorter growing season when 
compared with other Mendocino County viticultural areas, the petition 
states, along with comparatively high annual rain levels and some snow.

Name Evidence

    Covelo is the name of a small, rural town within Round Valley in 
Mendocino County, California. The town appears on the United States 
Geological Survey (USGS) quadrangle maps of Covelo East and Covelo 
West, and on the 2002 Rand McNally California map provided with the 
petition. The California State Automobile Association's Mendocino and 
Sonoma Coast map identifies Covelo as a rural township in northwest 
California. The 1988 DeLorme Northern California map also shows the 
town of Covelo and ``Covelo Road'' (State Highway 162), which runs 
through the proposed viticultural area.
    The National Oceanic and Atmospheric Administration's California 
Climatological Data report of October 1999 includes temperature data 
for the Covelo weather station. The Covelo East USGS quadrangle map 
shows that the Covelo Ranger Station is about a mile north of the town.

Boundary Evidence

    The distinctive elements of the proposed Covelo viticultural area, 
the petition states, are its geography, climate, and growing season. 
The proposed Covelo area, as described in the petition and noted on 
USGS maps, is largely a round, flat valley isolated from surrounding 
regions by a ring of foothills and mountains. The petitioner included 
the foothills immediately adjacent to valley floor within the proposed 
area because of the hillside's viticultural potential, but excluded the 
higher and steeper mountainous terrain beyond the proposed area's 
boundary since that mountainous terrain is less suitable for commercial 
viticulture.
    The petition explains that the proposed area's boundaries encompass 
Covelo's microclimate, which is created by the distinct combination of 
the area's geographic self-containment and its inland location. The 
area's climate has significant day and night temperature differences, 
and a short grape-growing season. This isolated valley climate differs 
from the marine-influenced climate found in most of the surrounding 
regions of Mendocino County.
    The petitioner drew the proposed area's boundary using a series of 
peaks and elevation benchmarks in the hills surrounding the Round and 
Williams Valleys. These elevation points vary from a low of 1,762 feet 
on the proposed area's southern boundary to a high of 2,792 feet on its 
northern boundary.

Growing Conditions

Geography
    The proposed Covelo viticultural area's boundary surrounds Round 
Valley, the bowl-shaped basin in which the town of Covelo lies. This 
broad, round, and flat-floored valley differs significantly from the 
long, narrow valleys commonly found in mountainous areas of Mendocino 
County, according to the petition. The proposed area also includes the 
smaller Williams Valley, located to Round Valley's northeast, and the 
hillsides that surround the two valleys. The provided USGS maps note 
that Round Valley's floor varies from 1,310 feet in elevation in the 
southeast to 1,480 feet in elevation in the northwest, while the 
surrounding hillsides are less than 2,800 feet high.
    As noted above, the petitioner used a series of peaks and elevation 
points under 2,800 feet in elevation to draw the boundary of the 
proposed Covelo viticultural area. In contrast to the proposed area, 
the higher elevations of the mountains that surround it vary between 
4,000 and 7,000 feet in elevation, according to the petition. These 
higher mountains, the petition explains, geographically and 
climatically isolate the proposed Covelo viticultural area from 
surrounding regions.
Climate
    The high mountain peaks that surround the proposed area, and the 
Coast Range, which parallels the Pacific Ocean to the area's west, 
block the inland flow of climate-moderating marine air and fog into the 
proposed Covelo viticultural area, according to the petition. Given 
this geographic isolation, the petition notes, the proposed Covelo 
viticultural area has a continental climate, which has greater 
temperature swings and a shorter growing season than the marine-
influenced climate commonly found in the surrounding regions of 
Mendocino County.
    The proposed Covelo viticultural area's short growing season, the 
petition emphasizes, may be its most distinguishing characteristic. The 
frost-free growing season is commonly 125 days, or about four months, 
long. Covelo's average growing season minimum temperature is also 
significantly lower than that of the established Potter Valley 
viticultural area (27 CFR 9.82), which is about 33 miles to the 
proposed area's south.
    The petition states that with 3,000 degree days, the Covelo 
viticultural area marginally falls into Region 3, of Winkler's climate 
classification system. (During the growing season, one degree day 
accumulates for each degree Fahrenheit that a day's average temperature 
is above 50 degrees, which is the minimum temperature required for 
grapevine growth. See ``General Viticulture,'' by Albert J. Winkler, 
University of California Press, 1974.) The table below shows the 
petitioner's comparison of degree day for grape-growing regions near 
the proposed Covelo viticultural area.

[[Page 5395]]



------------------------------------------------------------------------
                                                              Summation
                                                              of growing
              Mendocino grape-growing  regions                  season
                                                              degree-day
                                                                units
------------------------------------------------------------------------
Covelo.....................................................        3,000
Hopland....................................................        3,313
Potter Valley viticultural area (27 CFR 9.82)..............        3,341
Redwood Valley viticultural area (27 CFR 9.153)............        2,914
Ukiah......................................................        3,460
Willits....................................................        2,224
------------------------------------------------------------------------

    According to the petition, the proposed Covelo viticultural area's 
summer temperatures have greater day-to-night variations (between 40 
and 66 degrees in the valley) than the areas surrounding it. Also, in 
October (the final month of the summer growing season) the proposed 
viticultural area has 90 fewer degree-day units of heat than other 
Region 3 viticultural areas in the Mendocino region.
    The proposed Covelo viticultural area, the petition notes, receives 
an average of 40 inches of rain a year, which is the highest average of 
any valley in northern Mendocino County. The petition explains, 
however, that annual rainfall in the proposed area varies widely. In 
1998, the proposed Covelo viticultural area received 65 inches of rain, 
while in 2000, it received 36 inches, according to the National Oceanic 
and Atmospheric Administration's Climatological Data Annual Summary 
reports of California for 1997 through 2001, which were included in the 
petition. In addition, the proposed Covelo viticultural area's valley 
basin receives about 7 inches of snow annually, with higher amounts 
falling on the surrounding hillsides.
Geology and Soils
    The petition notes that the proposed Covelo viticultural area is 
composed of alluvial plains, alluvial fans, and a valley basin, which 
are geographically younger than the surrounding higher elevations. 
While the alluvial deposits on the valley floor share the mineralogy of 
the Franciscan rocks of the surrounding hills, the petition explains 
that Covelo's valley basin soils differ distinctly from the soils found 
in the foothills surrounding the valley.
    As noted in the petition, Feliz-Russian-Cole soils cover about 50 
percent of the proposed Covelo viticultural area. These soils, which 
are found in the Round Valley basin, have neutral-to-alkaline soil pH 
chemistry, in contrast with the acidity found in the hillside soils.
    The Sanhedren-Speaker-Kekawaka association, which is a deep to very 
deep, well-drained loam and gravelly loam, predominates in the 
northern, eastern, and western foothills surrounding Round Valley, 
according to the petition. In the southern foothills, the Dingman-
Beaughton-Henneke association (a well-drained, gravelly loam and cobbly 
clay loam) and the Hopland-Yorktree-Witherell association (a well-
drained loam and sandy loam) predominate.
    The petition adds that soils of the Franciscan Formation, a blue 
schist and semi-schist of Franciscan Complex, cover the mountainous 
terrain above the proposed area's boundary.

Boundary Description

    See the narrative boundary description of the petitioned-for 
viticultural area in the proposed regulatory text published at the end 
of this notice.

Maps

    The petitioner(s) provided the required maps, and we list them 
below in the proposed regulatory text.

Impact on Current Wine Labels

    Part 4 of the TTB regulations prohibits any label reference on a 
wine that indicates or implies an origin other than the wine's true 
place of origin. If we establish this proposed viticultural area, its 
name, ``Covelo,'' will be recognized as a name of viticultural 
significance. Consequently, wine bottlers using ``Covelo'' in a brand 
name, including a trademark, or in another label reference as to the 
origin of the wine, will have to ensure that the product is eligible to 
use the viticultural area's name as an appellation of origin. The 
proposed part 9 regulatory text set forth in this document specifies 
the ``Covelo'' name as a term of viticultural significance for purposes 
of part 4 of the TTB regulations.
    For a wine to be eligible to use as an appellation of origin the 
name of a viticultural area specified in part 9 of the TTB regulations, 
at least 85 percent of the grapes used to make the wine must have been 
grown within the area represented by that name, and the wine must meet 
the other conditions listed in 27 CFR 4.25(e)(3). If the wine is not 
eligible to use the viticultural area name as an appellation of origin 
and that name appears in the brand name, then the label is not in 
compliance and the bottler must change the brand name and obtain 
approval of a new label. Similarly, if the viticultural area name 
appears in another reference on the label in a misleading manner, the 
bottler would have to obtain approval of a new label. Accordingly, if a 
new label or a previously approved label uses the name ``Covelo'' for a 
wine that does not meet the 85 percent standard, the new label will not 
be approved, and the previously approved label will be subject to 
revocation, upon the effective date of the approval of the Covelo 
viticultural area.
    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)(2) for details.

Public Participation

Comments Invited

    We invite comments from interested members of the public on whether 
we should establish the proposed viticultural area. We are also 
interested in receiving comments on the sufficiency and accuracy of the 
name, boundary, climactic, and other required information submitted in 
support of the petition. Please provide any available specific 
information in support of your comments.
    Because of the potential impact of the establishment of the 
proposed Covelo viticultural area on brand labels that include the 
words ``Covelo'' as discussed above under Impact on Current Wine 
Labels, we are particularly interested in comments regarding whether 
there will be a conflict between the proposed area name and currently 
used brand names. If a commenter believes that a conflict will arise, 
the comment should describe the nature of that conflict, including any 
negative economic impact that approval of the proposed viticultural 
area will have on an existing viticultural enterprise. We are also 
interested in receiving suggestions for ways to avoid any conflicts, 
for example by adopting a modified or different name for the 
viticultural area.

Submitting Comments

    Please submit your comments by the closing date shown above in this 
notice. Your comments must include this notice number and your name and 
mailing address. Your comments must be legible and written in language 
acceptable for public disclosure. We do not acknowledge receipt of 
comments, and we consider all comments as originals. You may submit 
comments in one of five ways:
     Mail: You may send written comments to TTB at the address 
listed in the ADDRESSES section.
     Facsimile: You may submit comments by facsimile 
transmission to 202-927-8525. Faxed comments must--
    (1) Be on 8.5- by 11-inch paper;

[[Page 5396]]

    (2) Contain a legible, written signature; and
    (3) Be no more than five pages long. This limitation assures 
electronic access to our equipment. We will not accept faxed comments 
that exceed five pages.
     E-mail: You may e-mail comments to [email protected]. Comments 
transmitted by electronic mail must--
    (1) Contain your e-mail address;
    (2) Reference this notice number on the subject line; and
    (3) Be legible when printed on 8.5- by 11-inch paper.
    Online form: We provide a comment form with the online copy of this 
notice on our Web site at http://www.ttb.gov/alcohol/rules/index.htm. 
Select the ``Send comments via e-mail'' link under this notice number.
     Federal e-Rulemaking Portal: To submit comments to us via 
the Federal e-rulemaking portal, visit http://www.regulations.gov and 
follow the instructions for submitting comments.
    You may also write to the Administrator before the comment closing 
date to ask for a public hearing. The Administrator reserves the right 
to determine, in light of all circumstances, whether to hold a public 
hearing.

Confidentiality

    All submitted material is part of the public record and subject to 
disclosure. Do not enclose any material in your comments that you 
consider confidential or inappropriate for public disclosure.

Public Disclosure

    You may view copies of this notice, the petition, the appropriate 
maps, and any comments we receive by appointment at the TTB Library at 
1310 G Street, NW., Washington, DC 20220. You may also obtain copies at 
20 cents per 8.5- x 11-inch page. Contact our librarian at the above 
address or telephone 202-927-2400 to schedule an appointment or to 
request copies of comments.
    For your convenience, we will post this notice and any comments we 
receive on this proposal on the TTB Web site. We may omit voluminous 
attachments or material that we consider unsuitable for posting. In all 
cases, the full comment will be available in the TTB Library. To access 
the online copy of this notice, visit http://www.ttb.gov/alcohol/rules/index.htm. Select the ``View Comments'' link under this notice number 
to view the posted comments.

Regulatory Flexibility Act

    We certify that this proposed regulation, if adopted, would not 
have a significant economic impact on a substantial number of small 
entities. The proposed regulation 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 proposed rule is not a significant regulatory action as 
defined by Executive Order 12866, 58 FR 51735. Therefore, it requires 
no regulatory assessment.

Drafting Information

    N.A. Sutton of the Regulations and Procedures Division drafted this 
notice.

List of Subjects in 27 CFR Part 9

    Wine.

Proposed Regulatory Amendment

    For the reasons discussed in the preamble, we propose to amend 
title 27, chapter I, part 9, Code of Federal Regulations, as follows:

PART 9--AMERICAN VITICULTURAL AREAS

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

    Authority: 27 U.S.C. 205.

    2. Amend subpart C by adding Sec.  9.---- to read as follows:

Subpart C--Approved American Viticultural Areas


Sec.  9.----  Covelo.

    (a) Name. The name of the viticultural area described in this 
section is ``Covelo''. For purposes of part 4 of this chapter, 
``Covelo'' is a term of viticultural significance.
    (b) Approved Maps. The appropriate maps for determining the 
boundaries of the Covelo viticultural area are four United States 
Geological Survey (USGS) 1:24,000 scale topographic maps. They are 
titled:
    (1) Dos Rios, California Quadrangle--Mendocino Co., 7.5 Minute 
Series, edition of 1967, revised 1994;
    (2) Covelo West, California Quadrangle--Mendocino Co., 7.5 Minute 
Series, edition of 1967, photoinspected 1973;
    (3) Covelo East, California Quadrangle--Mendocino Co., 7.5 Minute 
Series, edition of 1967, revised 1994; and
    (4) Jamison Ridge, California Quadrangle--Mendocino Co., 7.5 Minute 
Series, edition of 1967, revised 1994.
    (c) Boundary. The Covelo viticultural area surrounds the town of 
Covelo in northern Mendocino County, California, about 30 miles east of 
the Pacific Coastline. The area's boundaries are defined as follows--
    (1) Beginning on the Dos Rios Quadrangle map at the intersection of 
State Highway 162 and the section 25 and 36 boundary line, T22N, R13W 
(labeled Inspiration Point on the map), proceed west 0.3 miles on 
Highway 162 to BM 2006 in section 36, T22N, R13W; then
    (2) Proceed straight west-northwest 1.5 miles to the 2,537-foot 
elevation point in the northwest quadrant of section 26, T22N, R13W, 
Dos Rios Quadrangle; then
    (3) Proceed straight northwest 1.6 miles to the 2,488-foot peak in 
the northwest quadrant of section 22, T22N, R13W, Covelo West 
Quadrangle; then
    (4) Proceed straight north-northwest 0.75 miles to the 2,262-foot 
peak on the section 15 and 16 boundary line, and continue straight 
north 1.6 miles to the 2,247-foot peak on the section 3 and 4 boundary 
line; then
    (5) Proceed straight northerly 1 mile to the 1,974-foot peak on the 
shared T22N and T23N boundary line, Covelo West Quadrangle, and 
continue straight north 1.6 miles to the 2,290-foot peak in the 
northwest quadrant of section 27, T23N, R13W, Covelo West Quadrangle; 
then
    (6) Proceed straight northeast 1.2 miles to the 2,397-foot peak in 
the northeast quadrant of section 22, and continue straight northeast 
1.5 miles to BM 2210 in the northeast quadrant of section 14, T23N, 
R13W, Covelo West Quadrangle; then
    (7) Proceed straight east-southeast 1.75 miles to the 2,792-foot 
peak in the southwest quadrant of section 18, T23, R12W, Covelo East 
Quadrangle; then
    (8) Proceed straight north-northeasterly 0.9 mile to the 2,430-foot 
elevation point in the southeast quadrant of section 7, T23N, R12W, 
Covelo East Quadrangle; then
    (9) Proceed straight east-northeast 1.6 miles to the peak of Coyote 
Rock in section 9, T23N, R12W, Covelo East Quadrangle; then
    (10) Proceed straight east-southeast 1.55 miles to the 2,435-foot 
elevation point in the northern half of section 15, and continue 
straight southeast 2.3 miles to the 2,066-foot peak in the southwest 
quadrant of section 24, T23N, R12W, Covelo East Quadrangle; then
    (11) Proceed straight south-southwest 0.6 mile to the 2,024-foot 
peak near the

[[Page 5397]]

section 26 eastern boundary line, T23N, R12W, Covelo East Quadrangle; 
then
    (12) Proceed straight west-southwest 1.9 miles to the 2,183-foot 
peak in the northwest quadrant of section 34, T23N, R12W, Covelo East 
Quadrangle; then
    (13) Proceed straight south-southeast 1.2 miles to the 1,953-foot 
peak in the northeast quadrant of section 3, T22N, R12W, Covelo East 
Quadrangle; then
    (14) Proceed straight southerly 0.9 mile to the 2,012-foot peak in 
the northeast quadrant of section 10, T22N, R12W, Covelo East 
Quadrangle; then
    (15) Proceed straight south-southeast 1.4 miles along Dingman Ridge 
to the 2,228-foot peak along the section 14 and 15 boundary line, T22N, 
R12W, Covelo East Quadrangle; then
    (16) Proceed straight southeast 0.95 mile to the 2,398-foot peak in 
the northeast quadrant of section 23, T22N, R12W, Covelo East 
Quadrangle; then
    (17) Proceed straight south-southeast 1.75 miles to the 2,474-foot 
elevation point along the section 25 and 26 boundary line, T22N, R12W, 
Jamison Ridge Quadrangle; then
    (18) Proceed straight west-southwest 0.9 mile to BM 2217 in the 
southwest quadrant of section 26, and continue straight westerly 1.5 
miles to the 2,230-foot peak northwest of Iron Spring, in the southeast 
quadrant of section 28, T22N, R12W, Jamison Ridge Quadrangle; then
    (19) Proceed straight southwest 0.65 mile to the 2,022-foot peak 
along the unimproved road in section 33, T22N, R12W, Jamison Ridge 
Quadrangle; then
    (20) Proceed straight west-northwest 1.5 miles to the 1,762-foot 
peak in the northeast quadrant of section 31, and continue in the same 
line of direction 1.1 miles to the beginning point at the intersection 
of State Highway 162 and the section 25 and 36 boundary line, T22N, 
R13W (labeled Inspiration Point), on the Dos Rios Quadrangle map.

    Signed: January 25, 2005.
John J. Manfreda,
Administrator.
[FR Doc. 05-1875 Filed 2-1-05; 8:45 am]
BILLING CODE 4810-31-P