[Federal Register Volume 87, Number 156 (Monday, August 15, 2022)]
[Rules and Regulations]
[Pages 49986-49990]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17508]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[Docket No. TTB-2021-0009; T.D. TTB-184; Ref: Notice No. 206]
RIN 1513-AC72


Establishment of the Gabilan Mountains Viticultural Area

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

ACTION: Final rule; Treasury decision.

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SUMMARY: The Alcohol and Tobacco Tax and Trade Bureau (TTB) establishes 
the approximately 98,000-acre ``Gabilan Mountains'' viticultural area 
in Monterey and San Benito Counties, in California. The newly-
established Gabilan Mountains viticultural area is located entirely 
within the existing Central Coast viticultural area and entirely 
encompasses the existing Mt. Harlan and Chalone viticultural areas. TTB 
designates viticultural areas to allow vintners to better describe the 
origin of their wines and to allow consumers to better identify wines 
they may purchase.

DATES: This final rule is effective September 14, 2022.

FOR FURTHER INFORMATION CONTACT: Karen A. Thornton, Regulations and 
Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G 
Street NW, Box 12, Washington, DC 20005; phone 202-453-1039, ext. 175.

SUPPLEMENTARY INFORMATION: 

Background on Viticultural Areas

TTB Authority

    Section 105(e) of the Federal Alcohol Administration Act (FAA Act), 
27 U.S.C. 205(e), authorizes the Secretary of the Treasury to prescribe 
regulations for the labeling of wine, distilled spirits, and malt 
beverages. The FAA Act provides that these regulations should, among 
other things, prohibit consumer deception and the use of misleading

[[Page 49987]]

statements on labels, and ensure that labels provide the consumer with 
adequate information as to the identity and quality of the product. The 
Alcohol and Tobacco Tax and Trade Bureau (TTB) administers the FAA Act 
pursuant to section 1111(d) of the Homeland Security Act of 2002, 
codified at 6 U.S.C. 531(d). In addition, the Secretary of the Treasury 
has delegated certain administrative and enforcement authorities to TTB 
through Treasury Order 120-01.
    Part 4 of the TTB regulations (27 CFR part 4) authorizes TTB to 
establish definitive viticultural areas and regulate 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) sets 
forth standards for the preparation and submission to TTB of petitions 
for the establishment or modification of American viticultural areas 
(AVAs) and lists the approved AVAs.

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 having distinguishing features as described in part 9 of 
the regulations and, once approved, a name and a delineated boundary 
codified 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 the 
wine's geographic origin. The establishment of AVAs allows vintners to 
describe more accurately the origin of their wines to consumers and 
helps consumers to identify wines they may purchase. Establishment of 
an AVA 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 (27 CFR 4.25(e)(2)) 
outlines the procedure for proposing an AVA and allows any interested 
party to petition TTB to establish a grape-growing region as an AVA. 
Section 9.12 of the TTB regulations (27 CFR 9.12) prescribes standards 
for petitions to establish or modify AVAs. Petitions to establish an 
AVA must include the following:
     Evidence that the area within the proposed AVA boundary is 
nationally or locally known by the AVA name specified in the petition;
     An explanation of the basis for defining the boundary of 
the proposed AVA;
     A narrative description of the features of the proposed 
AVA affecting viticulture, such as climate, geology, soils, physical 
features, and elevation, that make the proposed AVA distinctive and 
distinguish it from adjacent areas outside the proposed AVA;
     If the proposed AVA is to be established within, or 
overlapping, an existing AVA, an explanation that both identifies the 
attributes of the proposed AVA that are consistent with the existing 
AVA and explains how the proposed AVA is sufficiently distinct from the 
existing AVA and therefore appropriate for separate recognition;
     If the petition proposes the establishment of a new AVA 
that is larger than, and encompasses, one or more existing AVAs, the 
evidence submitted under paragraph (a) of Sec.  9.12 must include 
information addressing whether, and to what extent, the attributes of 
the proposed AVA are consistent with those of the existing AVA(s);
     The appropriate United States Geological Survey (USGS) 
map(s) showing the location of the proposed AVA, with the boundary of 
the proposed AVA clearly drawn thereon; and
     A detailed narrative description of the proposed AVA 
boundary based on USGS map markings.

Gabilan Mountains Petition

    TTB received a petition from Parker Allen of Coastview Vineyards, 
proposing to establish the ``Gabilan Mountains'' AVA. The proposed AVA 
is located in Monterey and San Benito Counties, in California, and lies 
entirely within the established Central Coast AVA (27 CFR 9.75). 
Additionally, the proposed AVA encompasses the established Mt. Harlan 
(27 CFR 9.131) and Chalone (27 CFR 9.24) AVAs. Within the proposed AVA, 
there are 6 commercial vineyards, which cover a total of approximately 
436 acres, as well as 4 wineries. The distinguishing features of the 
proposed Gabilan Mountains AVA are its elevation, climate, and soils.

Elevation

    The proposed Gabilan Mountains AVA is located in a mountainous 
region with high elevations. According to the petition, the average 
elevation within the proposed AVA is 2,370 feet. By contrast, all 
surrounding regions have lower elevations. To the north of the proposed 
AVA, the average elevation in the Santa Clara Valley AVA (27 CFR 9.126) 
is 345 feet. The average elevation within the established Arroyo Seco 
AVA (27 CFR 9.59), located to the south of the proposed AVA, is 331 
feet. To the east of the proposed AVA, the average elevation ranges 
from 778 feet within the established Paicenes AVA (27 CFR 9.39) to 
1,105 feet within the established Cienega Valley AVA (27 CFR 9.38). 
West of the proposed AVA, the average elevation ranges from 480 feet 
within the established Monterey AVA (27 CFR 9.98) to 512 feet within 
the established Santa Lucia Highlands AVA (27 CFR 9.139).
    According to the petition, the proposed AVA's higher elevations 
place it above the heavy fog and marine layer. As a result, the 
proposed AVA has a cool air climate without the humidity from the fog 
and low-lying clouds. The petition claims that the lower humidity 
levels significantly reduce mildew pressure in the proposed AVA, which 
allows growers to use less fungicide and pursue more organic practices 
during the growing season.

Climate

    The petition states that the climate of the proposed Gabilan 
Mountains AVA distinguishes it from the surrounding regions, 
particularly with respect to fog and rainfall. According to the 
petition, the proposed AVA averages fewer than 2.5 hours of fog and low 
clouds per day each year during the months of June through September. 
The regions to the west and north of the proposed AVA each average nine 
hours of fog and low cloud cover daily, while the region to the south 
averages seven hours. Paicines, which is to the east of the proposed 
AVA and sheltered from the marine air by the Hollister Hills, receives 
an average of only 2 hours of fog and low cloud cover daily. According 
to the petition, the low amounts of fog and lack of low clouds in the 
proposed AVA allow grapevines more access to direct sunlight, which 
assists photosynthesis of the vines for proper maturation. The lack of 
fog and low clouds also reduces the amount of humidity in the proposed 
AVA, reducing the chance of mildew developing in the vineyards.
    Although the proposed AVA has less fog and low cloud cover than 
most of the surrounding regions, annual rainfall amounts within the 
proposed Gabilan Mountains AVA are higher. The proposed AVA receives an 
average of 17.24 inches of rain each year, with over 12 inches of that 
total falling during the fall and winter months. The region to the 
north of the proposed AVA averages 14.19 inches of rain annually, while 
the region to the east receives 16.06 inches. To the south of the 
proposed AVA, the average annual rainfall total is 12.06 inches, and 
the amount for the region to

[[Page 49988]]

the west is 12.83 inches. The petition states that higher rainfall 
amounts during the fall and winter months act to clear the soil and 
send nutrients and carbohydrates to the dormant vines' roots. The 
petition also states that within the AVA, the drier summers reduce the 
risk of moisture-related diseases damaging the fruit and keep the 
sugars and acids in balance closer to harvest.

Soils

    The petition describes the soils of the proposed Gabilan Mountains 
AVA as moderately coarse textured soils over a bedrock of granite. The 
soils are rich in calcium due to the high limestone content. The 
petition states that the high calcium content of the soil causes grapes 
to carry acid later into the growing season, allowing growers to let 
the grapes remain on the vines longer so that they reach physiological 
ripeness. The soils are primarily from the Sheridan-Cieneba-Auberry 
association and are well-drained to excessively drained. According to 
the petition, the quick-draining soils cause stress to the vines during 
the growing season, resulting in intense flavors and rich, hardy skins 
that are less frequently associated with vines grown in poorly drained 
soils.
    By contrast, the petition states that the soils to the east and 
west of the proposed Gabilan Mountains AVA are medium textured soils on 
floodplains and alluvial fans. The petition includes a map of the soil 
associations of San Benito County, which includes the region to the 
east of the proposed AVA. According to the map, the soils east of the 
proposed AVA are primarily from the San Benito-Gazos-Linne association. 
The petition did not include information about the soils to the north 
and south of the proposed AVA or a soil association map showing the 
specific soil associations to the west of the proposed AVA.

Notice of Proposed Rulemaking and Comments Received

    TTB published Notice No. 206 in the Federal Register on November 
10, 2021 (86 FR 62495), proposing to establish the Gabilan Mountains 
AVA. In the notice, TTB summarized the evidence from the petition 
regarding the name, boundary, and distinguishing features for the 
proposed AVA. The notice also included the information from the 
petition comparing the distinguishing features of the proposed AVA to 
the surrounding areas. For a detailed description of the evidence 
relating to the name, boundary, and distinguishing features of the 
proposed AVA, and for a detailed comparison of the distinguishing 
features of the proposed AVA to the surrounding areas, see Notice No. 
206.
    In Notice No. 206, TTB solicited comments on the accuracy of the 
name, boundary, and other required information submitted in support of 
the petition. In addition, given the proposed Gabilan Mountains AVA's 
location within the Central Coast AVA, TTB solicited comments on 
whether the evidence submitted in the petition regarding the 
distinguishing features of the proposed AVA sufficiently differentiates 
it from the established AVA. TTB also requested comments on whether the 
geographic features of the proposed AVA are so distinguishable from the 
established Central Coast AVA that the proposed AVA should no longer be 
part of the established AVA. Finally, because the proposed AVA 
encompasses the existing Mt. Harlan and Chalone AVAs, TTB requested 
comments on whether the proposed AVA is sufficiently different from the 
existing AVAs, and if the features of the proposed AVA are so different 
that one or both of the established AVAs should not be included within 
it. The comment period closed January 10, 2022.
    In response to Notice No. 206, TTB received two comments. Both 
comments support establishing the proposed AVA. Neither comment 
addressed the inclusion of the Mt. Harlan and Chalone AVAs within the 
proposed Gabilan Mountains AVA or the proposed AVA's inclusion in the 
Central Coast AVA.

TTB Determination

    After careful review of the petition and the comments received in 
response to Notice No. 206, TTB finds that the evidence provided by the 
petitioner supports the establishment of the Gabilan Mountains AVA. 
Accordingly, under the authority of the FAA Act, section 1111(d) of the 
Homeland Security Act of 2002, and parts 4 and 9 of the TTB 
regulations, TTB establishes the ``Gabilan Mountains'' AVA in portions 
of Monterey and San Benito Counties, California, effective 30 days from 
the publication date of this document.
    TTB has also determined that the Gabilan Mountains AVA will remain 
part of the established Central Coast AVA. As discussed in Notice No. 
206, the Gabilan Mountains AVA shares some broad characteristics with 
the established AVA. For example, the primary characteristic of the 
Central Coast AVA is its marine-influenced climate, which results in 
higher rainfall amounts than occur in the inland valleys on the eastern 
side of the Coastal Ranges. The Gabilan Mountains AVA also experiences 
higher annual rainfall amounts than the regions to the east of the 
Coastal Ranges. However, due to its higher elevations, the Gabilan 
Mountains AVA experiences less marine fog incursion than many of the 
lower elevations in the Central Coast AVA. Additionally, due to its 
smaller size, the soils and elevations of the Gabilan Mountains AVA are 
less varied than those of the large, multi-county Central Coast AVA.
    Finally, TTB has determined that the Mt. Harlan and Chalone AVAs 
will remain a part of the Gabilan Mountains AVA. All three AVAs are 
high elevation AVAs that experience less marine fog than the lower 
neighboring regions. Like the Gabilan Mountains AVA, the Mt. Harlan AVA 
contains soils of the Sheridan, Cieneba, and Auberry series, and the 
Chalone AVA soils contain large amounts of calcium derived from 
limestone. However, the Mt. Harlan and Chalone AVAs also have 
characteristics that distinguish themselves from the Gabilan Mountains 
AVA and justify their continued existence as AVAs within the larger 
AVA. For example, both the Mt. Harlan and Chalone AVAs contain a 
narrower range of elevations due to their smaller size. Additionally, 
due to its proximity to the Hollister and Cienega Valleys that funnel 
storms in from the Pacific Ocean, the Mt. Harlan AVA receives more 
rainfall each year than the Gabilan Mountains AVA as a whole. The 
Chalone AVA, however, is sheltered from the Pacific storms by the Santa 
Lucia Mountains and receives less rainfall annually than the Gabilan 
Mountains AVA as a whole.

Boundary Description

    See the narrative description of the boundary of the Gabilan 
Mountains AVA in the regulatory text published at the end of this final 
rule.

Maps

    The petitioners provided the required maps, and they are listed 
below in the regulatory text. The Gabilan Mountains AVA boundary may 
also be viewed on the AVA Map Explorer on the TTB website, at https://www.ttb.gov/wine/ava-map-explorer.

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. For a wine to be labeled with an AVA name or with a 
brand name that includes an AVA name, at least 85 percent of the wine 
must be derived from grapes grown within the area represented by

[[Page 49989]]

that name, and the wine must meet the other conditions listed in 27 CFR 
4.25(e)(3). If the wine is not eligible for labeling with an AVA name 
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 AVA name appears in another 
reference on the label in a misleading manner, the bottler would have 
to obtain approval of a new label. Different rules apply if a wine has 
a brand name containing an AVA 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.
    With the establishment of the Gabilan Mountains AVA, its name, 
``Gabilan Mountains,'' will be recognized as a name of viticultural 
significance under Sec.  4.39(i)(3) of the TTB regulations (27 CFR 
4.39(i)(3)). The text of the regulations clarifies this point. 
Consequently, wine bottlers using the name ``Gabilan Mountains'' 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 AVA name as an appellation of origin.
    The establishment of the Gabilan Mountains AVA will not affect the 
existing Central Coast, Mt. Harlan, or Chalone AVAs, and any bottlers 
using ``Central Coast,'' ``Mt. Harlan,'' or ``Chalone'' as an 
appellation of origin or in a brand name for wines made from grapes 
grown within those AVAs will not be affected by the establishment of 
this new AVA. The establishment of the Gabilan Mountains AVA will allow 
vintners to use ``Gabilan Mountains'' and ``Central Coast'' as 
appellations of origin for wines made primarily from grapes grown 
within the Gabilan Mountains AVA if the wines meet the eligibility 
requirements for these appellations. Additionally, vintners may use 
``Gabilan Mountains'' as an appellation of origin in addition to or in 
place of ``Mt. Harlon'' or ``Chalone'' for wines made primarily from 
grapes grown in the Mt. Harlon or Chalone AVAs if the wines meet the 
eligibility requirements for either of these appellations.

Regulatory Flexibility Act

    TTB certifies that this regulation will not have a significant 
economic impact on a substantial number of small entities. The 
regulation imposes no new reporting, recordkeeping, or other 
administrative requirements. Any benefit derived from the use of an AVA 
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

    It has been determined that this final rule is not a significant 
regulatory action as defined by Executive Order 12866 of September 30, 
1993. Therefore, no regulatory assessment is required.

List of Subjects in 27 CFR Part 9

    Wine.

The Regulatory Amendment

    For the reasons discussed in the preamble, TTB amends title 27, 
chapter I, part 9, Code of Federal Regulations, 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. Subpart C is amended by adding Sec.  9.288 to read as follows:


Sec.  9.288   Gabilan Mountains.

    (a) Name. The name of the viticultural area described in this 
section is ``Gabilan Mountains.'' For purposes of part 4 of this 
chapter, ``Gabilan Mountains'' is a term of viticultural significance.
    (b) Approved maps. The 10 United States Geological Survey (USGS) 
1:24,000 scale topographic maps used to determine the boundary of the 
Gabilan Mountains viticultural area are titled:
    (1) Hollister, CA, 2015;
    (2) Mount Harlan, CA, 2015;
    (3) Paicines, CA, 2015;
    (4) Bickmore Canyon, CA, 2015;
    (5) North Chalone Peak, CA, 2015;
    (6) Soledad, CA, 2015;
    (7) Mount Johnson, CA, 2015;
    (8) Gonzales, CA, 2015;
    (9) Natividad, CA, 2015; and
    (10) San Juan Bautista, CA, 2015.
    (c) Boundary. The Gabilan Mountains viticultural area is located in 
Monterey and San Benito Counties in California. The boundary of the 
Gabilan Mountains viticultural area is as described as follows:
    (1) The beginning point is on the Hollister map at the intersection 
of the 1,520-foot elevation contour and an unnamed local road known 
locally as San Juan Canyon Road, southeast of the southernmost 
intersection of San Juan Canyon Road and Hillside Road. From the 
beginning point, proceed south, then southeasterly along the meandering 
1,520-foot elevation contour to its intersection with a west-east 
flowing tributary of Bird Creek in Azalea Canyon; then
    (2) Proceed southeast in a straight line, crossing Azalea Canyon 
and the main channel of Bird Creek, to the intersection of the 1,520-
foot elevation contour and a southeast-northwest flowing tributary of 
Bird Creek; then
    (3) Proceed generally southeasterly along the 1,520-foot elevation 
contour to its intersection with the eastern fork of an unnamed stream; 
then
    (4) Proceed southeast in a straight line, crossing onto the Mount 
Harlan map, to the intersection of the 1,600-ft elevation contour and 
the northernmost unnamed creek; then
    (5) Proceed generally south, then north along the 1,600-foot 
elevation contour to its intersection with a north-south trending 
tributary of Pescadero Creek; then
    (6) Proceed south in a straight line, crossing Pescadero Creek, to 
the 1,520-foot elevation contour; then
    (7) Proceed easterly along the meandering 1,520-foot elevation 
contour, crossing onto the Paicines map, and continuing along the 
1,520-foot elevation contour as it meanders back and forth between the 
Mount Harlan map and the Paicines map, crossing Thompson Creek and 
continuing along the 1,520-foot elevation contour to its intersection 
with the eastern fork of an unnamed intermittent stream on the Paicines 
map north of Three Troughs Canyon; then
    (8) Proceed southeast in a straight line to a fork in a tributary 
of Stone Creek east of Three Troughs Canyon; then
    (9) Proceed east-southeast in a straight line, crossing onto the 
Bickmore Canyon map, to the intersection of an unnamed tributary of the 
San Benito River and the 1,520-foot elevation contour; then
    (10) Proceed southeasterly along the 1,520-foot elevation contour 
to a point north of the confluence of Willow Creek and the South Fork 
of Willow Creek; then
    (11) Proceed south in a straight line to the confluence of Willow 
Creek and the South Fork of Willow Creek; then
    (12) Proceed east in a straight line to State Route 25; then
    (13) Proceed southeasterly along State Route 25 to its intersection 
with the boundary of Pinnacles National Park; then
    (14) Proceed south, then east, then generally south along the 
boundary of Pinnacles National Park, crossing onto the North Chalone 
Peak map, to the intersection of the National Park boundary and the 
1,520-foot elevation contour northeast of Mann Canyon; then

[[Page 49990]]

    (15) Proceed westerly along the 1,520-foot elevation contour to its 
intersection with CA-146; then
    (16) Proceed southwest in a straight line, crossing onto the 
Soledad map, to the fork in an unnamed intermittent creek running 
parallel to Fabry Road; then
    (17) Proceed northwest in a straight line, crossing over Stonewall 
Creek, the unnamed intermittent creek and its tributaries in Bryant 
Canyon, and a second unnamed intermittent creek, to the intersection of 
the 1,480-foot elevation contour and the northern terminus of a third 
unnamed intermittent stream; then
    (18) Proceed north in a straight line to the 1,520-foot elevation 
contour; then
    (19) Proceed southwest, then generally northwest along the 
meandering 1,520-foot elevation contour, crossing over the Mount 
Johnson map and back and forth between the Gonzales map and the Mount 
Johnson map to the intersection of the 1,520-foot elevation contour and 
an unnamed tributary of Chular Creek southeast of Espinosa Canyon on 
the Gonzales map; then
    (20) Proceed northwest in a straight line, crossing Chular Creek 
and Espinosa Canyon, to the 1,520-foot elevation contour; then
    (21) Proceed generally northwesterly, then northeasterly along the 
1,520-foot elevation contour, crossing over the Mount Harlan, 
Natividad, San Juan Bautista, and Hollister maps, returning to the 
beginning point on the Hollister map.

    Signed: August 4, 2022.
Mary G. Ryan,
Administrator.
    Approved: August 5, 2022.
Thomas C. West, Jr.,
Deputy Assistant Secretary (Tax Policy).
[FR Doc. 2022-17508 Filed 8-12-22; 8:45 am]
BILLING CODE 4810-31-P