[Federal Register Volume 89, Number 169 (Friday, August 30, 2024)]
[Rules and Regulations]
[Pages 70487-70490]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-19578]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[Docket No. TTB-2023-0007; T.D. TTB-195; Re: Notice No. 225]
RIN 1513-AD03


Establishment of the San Luis Rey 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 97,733-acre ``San Luis Rey'' American viticultural 
area (AVA) in San Diego County, California. The San Luis Rey 
viticultural area lies entirely within the established South Coast 
viticultural area. 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 30, 2024.

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 
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 has delegated 
the functions and duties in the administration and enforcement of these 
provisions to the TTB Administrator 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 boundary;
     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;
     If the proposed AVA is to be established within, or 
overlapping, an existing AVA, an explanation that both identities 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; and
     A detailed narrative description of the proposed AVA 
boundary based on USGS map markings.

San Luis Rey Petition

    TTB received a petition from Rebecca Wood, managing member of 
Premium Vintners, LLC on behalf of Fallbrook Winery and other local 
vineyard owners and winemakers proposing the establishment of the ``San 
Luis Rey'' AVA in San Diego County, California. Premium Vintners, LLC, 
operates Fallbrook Winery and farms several vineyards within the 
proposed AVA. The proposed San Luis Rey AVA is located entirely within 
the established South Coast AVA (27 CFR 9.104) and covers approximately 
97,733 acres. There are 44 commercially-producing vineyards covering a 
total of approximately 256 acres, along with 29 acres of planned 
vineyards. There are also 23 wineries within the proposed AVA.
    According to the petition, the distinguishing features of the 
proposed San Luis Rey AVA are its topography, climate, and soils. The 
proposed AVA has low elevations that allow cool marine air from the 
Pacific Ocean to flow through the region, moderating temperatures. The 
mean elevation within the proposed AVA is 563 feet, and the average 
slope angle is 10 degrees. The low elevations and a terrain of gently 
rolling hills that are open to marine air almost eliminate the spring 
frosts that can affect vine growth at the beginning of the growing 
season. The petition also notes that afternoon breezes help to prevent 
fungal diseases resulting from the morning's low cloud cover.
    In the region north of the proposed San Luis Rey AVA, elevations 
are higher and slope angles are similar to those in the proposed AVA. 
In the region to the south, average elevations are lower and

[[Page 70488]]

slope angles are shallower than within the proposed AVA. Also, in the 
area to the southeast, elevations are higher with steeper slope angles 
than the proposed AVA. The petition did not provide elevation ranges 
for the area east of the proposed AVA but did include a graphic 
indicating higher elevations to the east of the proposed AVA. The 
Pacific Ocean is west of the proposed AVA, so the petition did not 
provide distinguishing feature information for this area.
    The petition provided climate data, specifically the average annual 
mean temperature, average annual maximum temperature, average peak 
ripening and harvest season maximum temperature, and growing degree day 
\1\ (GDD) accumulations for the proposed AVA and surrounding regions. 
According to the petition, the proposed AVA generally has mild winters 
and summers with lower maximum temperatures than regions farther inland 
due to the proposed AVA's proximity to the Pacific Ocean. The petition 
notes that the proposed AVA has lower average annual mean and maximum 
temperatures and fewer GDDs than the regions to the north and south. 
The proposed AVA has a greater number of mean GDDs but lower minimum 
GDDs and a lower average annual maximum temperature than the area to 
the southeast. Additionally, the proposed San Luis Rey AVA has lower 
annual precipitation amounts than the regions to the north and 
southeast and slightly higher amounts than the region to the south.
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    \1\ See Albert J. Winkler, General Viticulture (Berkeley: 
University of California Press, 1974), pages 61-64. In the Winkler 
climate classification system, annual heat accumulation during the 
growing season, measured in annual GDDs, defines climatic regions. 
One GDD accumulates for each degree Fahrenheit that a day's mean 
temperature is above 50 degrees F, the minimum temperature required 
for grapevine growth.
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    The petition notes that nearly 50 percent of the soils in the 
proposed San Luis Rey AVA are Alfisols soils with high concentrations 
of essential plant nutrients. Approximately 69 percent of the soils in 
the proposed AVA are sandy loams that can hold water while draining and 
aerating well and prevent overly vigorous growth. Soils to the north 
are 48 percent Alfisols and also contain more Entisols and Mollisols 
soils than the proposed AVA. To the south, soils are primarily Alfisols 
but in lower amounts than the proposed AVA. This area also has more 
Entisols and Mollisols soils than the proposed AVA. To the southeast, 
soils are 46 percent Alfisols, but contain more Entisols than are found 
in the proposed AVA.

Notice of Proposed Rulemaking and Comments Received

    TTB published a notice of proposed rulemaking (NPRM) (Notice No. 
225) in the Federal Register on August 30, 2023 (88 FR 59820), 
proposing to establish the San Luis Rey AVA. In the NPRM, TTB 
summarized the evidence from the petition regarding the name, boundary, 
and distinguishing features for the proposed AVA. The NPRM also 
compared 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 the NPRM.
    In the NRPM, 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 San Luis Rey AVA's location 
within the South 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 
South Coast AVA. Finally, TTB requested comments on whether the 
geographic features of the proposed AVA are so distinguishable from the 
South Coast AVA that the proposed San Luis Rey AVA should no longer be 
part of the established AVA. The comment period closed October 30, 
2023.
    In response to the NPRM, TTB received one comment. The commenter is 
a wine reviewer who supported the establishment of the proposed San 
Luis Rey AVA, stating that its proposed boundaries encompass a 
subregion with soils compositions, temperature patterns, and acidity 
profiles that set the proposed AVA apart from neighboring AVAs. The 
commenter also stated that significant coastal influence on acidity 
profiles, in particular, invites the planting of grape varieties not 
otherwise found in the South Coast AVA.
    TTB did not receive any comments in response to its question of 
whether the proposed San Luis Rey AVA is so distinguishable from the 
established South Coast AVA that the proposed AVA should not be part of 
the established AVA.

TTB Determination

    After careful review of the petition and the comment received in 
response to the NPRM, TTB finds that the evidence provided by the 
petitioner supports the establishment of the San Luis Rey 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 ``San Luis Rey'' AVA in San Diego 
County, California, effective 30 days from the publication date of this 
document.
    TTB has also determined that the San Luis Rey AVA will remain part 
of the established South Coast AVA. As discussed in the NPRM, the 
proposed AVA shares the marine-influenced climate of the larger South 
Coast AVA. However, in general, the proposed San Luis Rey AVA has a 
lower mean elevation and more consistent terrain than the South Coast 
AVA. Additionally, the three most common soil series in the proposed 
AVA make up 34.9 percent of the total soils in the proposed AVA, but 
only comprise 20.3 percent of the total South Coast AVA soils.

Boundary Description

    See the narrative description of the boundary of the San Luis Rey 
AVA in the regulatory text published at the end of this final rule.

Maps

    The petitioner provided the required maps, and they are listed 
below in the regulatory text. The San Luis Rey 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 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 San Luis Rey AVA, its name, ``San 
Luis Rey,'' will be recognized as a name of

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viticultural significance under Sec.  4.39(i)(3) of the TTB regulations 
(27 CFR 4.39(i)(3)). The text of the regulation clarifies this point. 
Consequently, wine bottlers using the name ``San Luis Rey'' 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 San Luis Rey AVA will not affect any 
existing AVA, and any bottlers using ``South Coast AVA'' as an 
appellation of origin or in a brand name for wines made from grapes 
grown within the South Coast AVA will not be affected by the 
establishment of this new AVA. The establishment of the San Luis Rey 
AVA will allow vintners to use ``San Luis Rey'' and ``South Coast AVA'' 
as appellations of origin for wines made primarily from grapes grown 
within the San Luis Rey AVA if the wines meet the eligibility 
requirements for 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 requirement. 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, as amended. Therefore, no regulatory assessment is required.

Drafting Information

    Vonzella C. Johnson of the Regulations and Rulings Division drafted 
this final rule.

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.  9.295 to read as follows:


Sec.  9.295  San Luis Rey AVA.

    (a) Name. The name of the viticultural area described in this 
section is ``San Luis Rey''. For purposes of part 4 of this chapter, 
``San Luis Rey'' is a term of viticultural significance.
    (b) Approved maps. The eight United States Geological Survey (USGS) 
1:24,000 scale topographic maps used to determine the boundary of the 
viticultural area are as follows:
    (1) Oceanside, CA, 2018;
    (2) San Luis Rey, CA, 2018;
    (3) San Marcos, CA, 2018;
    (4) Valley Center, CA, 2018;
    (5) Bonsall, CA, 2018;
    (6) Temecula, CA, 2018;
    (7) Fallbrook, CA, 2018; and
    (8) Morro Hill, CA, 2018.
    (c) Boundary. The San Luis Rey viticultural area is located in San 
Diego County, California. The boundary of the San Luis Rey viticultural 
area is described as follows:
    (1) The beginning point is on the Oceanside map at the intersection 
of Interstate 5 and the Marine Corps Base (MCB) Camp Pendleton 
boundary. From the beginning point, proceed northeast for a total of 
11.21 miles along the MCB Camp Pendleton boundary, crossing over the 
San Luis Rey map and onto the Morro Hill map, and continuing along the 
MCB Camp Pendleton boundary to its intersection with the Naval Weapons 
Station (NWS) Seal Beach Fallbrook California boundary; then
    (2) Proceed east along the NWS Seal Beach Fallbrook California 
boundary for a total of 6.85 miles, crossing onto the Bonsall map and 
continuing north, then west along the boundary, and crossing back onto 
the Morro Hill map and continuing northerly along the boundary, 
crossing onto the Fallbrook map, and continuing along the boundary as 
it becomes concurrent with the MCB Camp Pendleton boundary, and 
continuing along the boundary to its intersection with De Luz Road; 
then
    (3) Proceed east along De Luz Road for 0.38 mile to its 
intersection with Sandia Creek Drive; then
    (4) Proceed northerly along Sandia Creek Drive for a total of 3.98 
miles, crossing onto the Temecula map and continuing along Sandia Creek 
Drive to its intersection with an unnamed road known locally as Rock 
Mountain Road; then
    (5) Proceed east along Rock Mountain Road for 0.21 mile to its 
intersection with the San Diego County line; then
    (6) Proceed south then east along the San Diego County line for 
6.72 miles to its intersection with an unnamed road known locally as 
Old Highway 395; then
    (7) Proceed south along Old Highway 395 for a total of 14.9 miles, 
crossing onto the Bonsall map and continuing south along Old Highway 
395 to its intersection with an unnamed road known locally as Old 
Castle Road; then
    (8) Proceed east on Old Castle Road for a total of 0.59 mile, 
crossing onto the San Marcos map and continuing east along Old Castle 
Road to its intersection with Gordon Hill Road; then
    (9) Proceed southeasterly along Gordon Hill Road for 0.92 mile to 
its intersection with the 800-foot elevation contour; then
    (10) Proceed east along the 800-foot elevation contour for a total 
of 2.5 miles, crossing onto the Valley Center map and continuing east 
along the 800-foot elevation contour to its intersection with Canyon 
Country Lane; then
    (11) Proceed northwest and then south along Canyon Country Lane for 
0.83 mile to its intersection with the 1,240-foot elevation contour; 
then
    (12) Proceed east along the 1,240-foot elevation contour for 2.90 
miles to its intersection with Cougar Pass Road; then
    (13) Proceed west then south along Cougar Pass Road for 0.4 mile to 
its intersection with Meadow Glen Way East; then
    (14) Proceed south along Meadow Glen Way East for 0.46 mile to its 
intersection with Hidden Meadows Road; then
    (15) Proceed southwest along Hidden Meadows Road for 0.73 mile to 
its intersection with Mountain Meadow Road; then
    (16) Proceed southwest along Mountain Meadow Road for a total of 
1.44 miles, crossing onto the San Marcos map and continuing along 
Mountain Meadow Road to the point where Mountain Meadow Road becomes 
known as Deer Springs Road just west of Interstate 15; then
    (17) Proceed southwest along Deer Springs Road for 2.42 miles to 
its intersection with an unnamed road known locally as North Twin Oaks 
Valley Road; then
    (18) Proceed south along North Twin Oaks Valley Road for 3.01 miles 
to its intersection with an unnamed road known locally as West Mission 
Road; then
    (19) Proceed northwest along West Mission Road (which becomes South

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Santa Fe Avenue) for a total of 3.9 miles to its intersection with 
Robelini Drive; then
    (20) Proceed southwest along Robelini Drive (which becomes Sycamore 
Avenue) for a total of 0.55 mile to its intersection with State Highway 
78; then
    (21) Proceed northwest, then westerly along State Highway 78 for a 
total of 9.09 miles, crossing onto the San Luis Rey map and continuing 
westerly along State Highway 78 to its intersection with Interstate 5; 
then
    (22) Proceed northwest along Interstate 5 for a total of 3.14 
miles, crossing onto the Oceanside map and returning to the beginning 
point.

    Signed: August 19, 2024.
Mary G. Ryan,
Administrator.

    Approved: August 20, 2024.
Aviva R. Aron-Dine,
Acting Assistant Secretary (Tax Policy).
[FR Doc. 2024-19578 Filed 8-29-24; 8:45 am]
BILLING CODE 4810-31-P