Establishment of the Eola-Amity Hills Viticultural Area (2002R-216P), 40400-40404 [E6-11077]

Download as PDF 40400 Federal Register / Vol. 71, No. 136 / Monday, July 17, 2006 / Rules and Regulations The Regulatory Amendment For the reasons discussed in the preamble, we amend title 27 CFR, chapter 1, part 9, as follows: I PART 9—AMERICAN VITICULTURAL AREAS 1. The authority citation for part 9 continues to read as follows: I Authority: 27 U.S.C. 205. Subpart C—Approved American Viticultural Areas 2. Subpart C is amended by adding a new § 9.203 to read as follows: I rmajette on PROD1PC67 with RULES § 9.203 Saddle Rock-Malibu. (a) Name. The name of the viticultural area described in this section is ‘‘Saddle Rock-Malibu’’. For purposes of part 4 of this chapter, ‘‘Saddle Rock-Malibu’’ is a term of viticultural significance. (b) Approved Map. The following United States Geological Survey, 1:24,000 scale, topographic map is used to determine the boundary of the Saddle Rock-Malibu viticultural area: Point Dume Quadrangle California, 7.5– Minute Series (Orthophotoquad), 1995. (c) Boundary. The Saddle RockMalibu viticultural area is located in Los Angeles County, California. The boundary of the Saddle Rock-Malibu viticultural area is as described below: (1) The beginning point is on the Point Dume map at the intersection of Decker Road and Mulholland Highway, section 3, T1S/R19W; (2) From the beginning point, proceed north-northeast along Decker Road approximately 0.7 mile to its intersection with the southern boundary of the El Conejo land grant, section 3, T1S/R19W; then (3) Proceed straight east-southeast along the El Conejo land grant boundary line approximately 0.4 mile to the point where the land grant boundary line changes direction to the northeast, section 2, T1S/R19W; then (4) Proceed straight northeast for approximately 0.5 mile along the El Conejo land grant boundary line to its second intersection with the 1,700-foot contour line in section 2, T1S/R19W; then (5) Proceed southeasterly along the meandering 1,700-foot contour line, crossing the R19W/R18W range line near the southwest corner of section 6, T1S/R18W, and continue along the 1,700-foot contour line to its intersection with Kanan Road near the southwest corner of section 6, T1S/ R18W; then (6) Proceed south along Kanan Road approximately 0.35 mile to its VerDate Aug<31>2005 15:22 Jul 14, 2006 Jkt 208001 intersection with the 1,800-foot contour line (very near the intersection of Kanan Road and an unnamed unimproved road), section 7, T1S/R18W; then (7) Proceed southeasterly along the meandering 1,800-foot contour line to a point approximately 200 feet due north of the intersection of Mulholland Highway and two unnamed, unimproved roads near the center of section 7, T1S/R18W, and, from that point, proceed due south in a straight line to the intersection of Mulholland Highway and the two unnamed, unimproved roads, section 7, T1S/ R18W; then (8) Following the eastern-most unimproved road, proceed southerly along the meandering unimproved road, passing to the west of a 2,054-foot peak, and continue to the road’s intersection with another unnamed, unimproved road immediately south of the section 18 north boundary line and due east of a 2,448-foot peak, section 18, T1S/ R18W; then (9) Proceed southwesterly along the unnamed, unimproved road to its intersection with the Latigo Canyon Road, just east of BM 2125, section 18, T1S/R18W; then (10) Proceed northerly then westerly along Latigo Canyon Road to its intersection with Kanan Road very near the southeast corner of section 12, T1S/ R19W; then (11) Proceed south along Kanan Road for approximately 0.6 mile to its intersection with the 1,700-foot contour line, located immediately south of the four-way intersection of two unnamed, unimproved roads and Kanan Road, section 13, T1S/R19W; then (12) Proceed 1.5 miles generally west and northwest along the unnamed, unimproved road that meanders westerly, crossing over several intermittent streams, and continues through Zuma Canyon to its intersection with Encinal Canyon Road at about the 1,806-foot elevation mark, section 11, T1S/R19W; then (13) Crossing Encinal Canyon Road, proceed northwesterly along the unnamed, unimproved road, which becomes a trail, and continue northerly to the trail’s intersection with the 1,900foot contour line, near the center of section 11, T1S/R19W; then (14) Proceed northwesterly along the meandering 1,900-foot contour line, circling to the west of the 2,189-foot peak in section 11, to the contour line’s intersection with Mulholland Highway at the northern boundary of section 11, T1S/R19W; then (15) Proceed westerly about 0.8 mile on Mulholland Highway and return to the beginning point. PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 Signed: May 9, 2006. John J. Manfreda, Administrator. Approved: June 15, 2006. Timothy E. Skud, Deputy Assistant Secretary (Tax, Trade, and Tariff Policy). [FR Doc. E6–11076 Filed 7–14–06; 8:45 am] BILLING CODE 4810–31–P DEPARTMENT OF THE TREASURY Alcohol and Tobacco Tax and Trade Bureau 27 CFR Part 9 [T.D. TTB–51; Re: Notice No. 15] RIN 1513–AA41 Establishment of the Eola-Amity Hills Viticultural Area (2002R–216P) Alcohol and Tobacco Tax and Trade Bureau (TTB), Treasury. ACTION: Final rule; Treasury decision. AGENCY: SUMMARY: This Treasury decision establishes the Eola-Amity Hills viticultural area in Oregon. The viticultural area is entirely within the existing Willamette Valley viticultural area and encompasses roughly 37,900 acres within Polk and Yamhill Counties. 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. DATES: Effective Date: August 16, 2006. FOR FURTHER INFORMATION CONTACT: Jennifer Berry, Alcohol and Tobacco Tax and Trade Bureau, Regulations and Rulings Division, P.O. Box 18152, Roanoke, Virginia 24014; telephone 540–344–9333. 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 consumers with adequate information regarding product 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 E:\FR\FM\17JYR1.SGM 17JYR1 Federal Register / Vol. 71, No. 136 / Monday, July 17, 2006 / Rules and Regulations 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 geographical 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 grapegrowing 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; • Evidence relating to the geographical features, such as climate, soils, elevation, and physical features, that distinguish the proposed viticultural area from surrounding areas; • A description of the specific boundary of the proposed viticultural area, based on features shown 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. rmajette on PROD1PC67 with RULES Rulemaking Proceedings Eola Hills Petition Mr. Russell Raney of Evesham Wood Vineyard and Mr. Ted Casteel of Bethel Heights Vineyard, both of Salem, Oregon, petitioned TTB for the establishment of a viticultural area to be called ‘‘Eola Hills.’’ The proposed viticultural area is within the State of Oregon and entirely within the existing VerDate Aug<31>2005 15:22 Jul 14, 2006 Jkt 208001 Willamette Valley viticultural area described in 27 CFR 9.90. The petitioners estimate that the proposed area encompasses 37,900 acres, about 1,244 acres of which are planted to vines. At the time of the petition, 12 wineries operated within the proposed area. We summarize below the evidence submitted with the petition. Name Evidence As historical evidence of the use of the name ‘‘Eola Hills,’’ the petitioners submitted an excerpt from ‘‘Oregon Geographic Names’’ (published by the Oregon Historical Society, 5th edition, 1982, pp. 294–295). This source states that the Eola Hills were named for the village of Eola, situated at the southern end of the ridge. On January 17, 1856, the Oregon territorial legislature incorporated the village as ‘‘Eola,’’ a name derived from Aeolus, the Classical Greek god of winds. The source further states that the Eola Hills ‘‘constitute one of the important groups of isolated hills in the Willamette Valley.’’ It goes on to explain that the hills have been known by other names, but the name ‘‘Eola Hills seems firmly established.’’ For additional name evidence, the petitioners also submitted several maps that identify the area as ‘‘Eola Hills.’’ Four of the USGS maps used to show the boundaries (Rickreall, Salem West, Mission Bottom, and Amity) identify the area as Eola Hills. The petitioners also submitted two geologic maps of the area issued by the State of Oregon’s Department of Geology and Mineral Industries. Both prominently label the area ‘‘Eola Hills.’’ According to the petitioners, Eola Hills has name recognition and a reputation for quality among wine consumers both in and outside of Oregon. For this reason, vineyards and wineries within the area utilize the name frequently in their promotional literature. The petitioners submitted two promotional maps demonstrating this fact. One map, entitled ‘‘The Wine Appellations of Oregon,’’ issued by the Oregon Wine Marketing Coalition, portrays the Eola Hills area as a subregion within the Willamette Valley. The other map, entitled ‘‘Eola Hills Winegrowing Region, Willamette Valley Oregon,’’ shows the location of all vineyards and wineries in the area. The petitioners note that a small portion of the proposed viticultural area is sometimes referred to as ‘‘Amity Hills.’’ ‘‘Oregon Geographic Names’’ describes the Amity Hills as a northern extension of the Eola Hills separated from the main ridge by a pass east of the town of Amity. USGS maps for McMinnville and Amity, Oregon, PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 40401 identify this area as Amity Hills. However, the geologic maps issued by Oregon’s Department of Geology and Mineral Industries identify this area as part of the Eola Hills. The petitioners argue that, for the purpose of wine designation, consumers in Oregon have come to recognize the entire area as a single unit known as ‘‘Eola Hills.’’ They also state that vintners in the Amity Hills portion of the area support the designation of Eola Hills for the entire area. Boundary Evidence As evidence of the boundary, the petitioners submitted with the petition six USGS topographic maps on which the Eola Hills are dominant features. The main ridge of the Eola Hills runs north to south, starting approximately 53⁄4 miles northeast of the town of Amity and extending south for 16 miles to Oregon Highway 22, just north of the Willamette River at West Salem. At their widest point, toward the southern end, the Eola Hills are about 61⁄2 miles across, from Wallace Road in the east to U.S. Highway 99 in the west. The petitioners use the 200-foot contour line as the predominant boundary marker. They note that they occasionally diverge to use roads or highways where they form a more convenient boundary and to exclude land not deemed suitable for grape cultivation due to soil type, elevation, or urban development. Distinguishing Features Soils and Geology The petitioners state that the soils and geology of the Eola Hills, compared to those of the surrounding areas, are distinctive in two regards. The petitioners note that the prevailing basalt-derived soils of the Eola Hills are shallower than the soils of other hills in the north Willamette Valley, and that these well drained basalt soils are very different from the alluvial soils of the surrounding valley floor. As evidence of these differences, the petitioners submitted two geologic maps issued by the State of Oregon’s Department of Geology and Mineral Industries. One is entitled ‘‘Geologic Map of the Rickreall and Salem Quadrangles, Oregon;’’ the other is entitled ‘‘Preliminary Geologic Map of the Amity and Mission Bottom Quadrangles, Oregon.’’ According to these documents, volcanic basalt rock from the lava flows of the Miocene epoch underlies the Eola Hills, and marine sedimentary rock of the Oligocene epoch underlies areas at the lower elevations of the ridge. The soils E:\FR\FM\17JYR1.SGM 17JYR1 40402 Federal Register / Vol. 71, No. 136 / Monday, July 17, 2006 / Rules and Regulations rmajette on PROD1PC67 with RULES at the middle and higher elevations of the Eola Hills are largely well drained silty clay loams weathered from basalt; those on the lower slopes are silt loams weathered predominantly from sedimentary rock, particularly on the west-facing slopes. According to soil survey maps issued by the U.S. Department of Agriculture, Soil Conservation Service, the dominant basalt-derived soils on the Eola Hills are Nekia soils (recently reclassified as Gelderman soils) and Ritner and Jory soils. The preponderance of the shallower Nekia and Gelderman soils in the Eola Hills differentiates the Eola Hills from the Red Hills farther north, where Jory soils are predominant. Nekia and Gelderman soils have a much lower available water capacity than Jory soils. The most common sedimentary soils on the Eola Hills are Steiwer, Chehulpum, and Helmick soils, especially on the west side of the ridge. Also in the Eola Hills are soils formed in alluvial deposits, the most common of which are the silt loam Woodburn soils. Such alluvial soils generally are only at the lowest elevations of the proposed viticultural area (below 300 feet). Like the soils mentioned above, these alluvial soils also are suitable for wine grapes if they are on slopes steep enough for good water drainage. Finally, the Eola Hills are surrounded on almost all sides by, and are easily distinguished from, terraces of the Willamette Valley. With few exceptions, the terraces lie below the 200-foot elevation line and are characterized by less drained alluvial soils. According to the petitioners, the soils on these terraces generally are not suitable for the cultivation of premium wine grapes. Therefore, land below an elevation of 200 feet is not included within the proposed Eola Hills boundary. Topography The main ridge of the Eola Hills runs north-south and has numerous lateral ridges that run east-west on both sides. Slopes on the west side of the ridge tend to be somewhat steeper and pocketed, and they fall away below an elevation of 200 feet more abruptly than the slopes on the east side, which tend to be gentler and more extensive. Both sides, however, provide vineyard sites with very similar soils and growing conditions. The highest point in the south end of the hills is 1,093 feet. In the central area, near the Polk-Yamhill County line, the ridge peaks at around 1,160 feet; in the north, it peaks at 863 feet. The majority of vineyards in the Eola Hills are at elevations ranging from 250 to 700 feet, although suitable sites, given proper sun exposure and VerDate Aug<31>2005 15:22 Jul 14, 2006 Jkt 208001 microclimate, are found above these elevations. Most vineyards in the Eola Hills have a southern, southwestern, or southeastern orientation. However, on gently sloping terrain, east- and westfacing sites are also capable of producing high quality wine grapes. Climate According to the petitioners, the Eola Hills are blessed with a temperate climate. Summers are warm, but seldom excessively hot; winters are mild, and in winter, temperatures are usually above freezing. Annual rainfall ranges from under 40 inches on the southeastern edge of the Eola Hills to more than 45 inches in the higher elevations. More important, only about 15 percent of the total annual rainfall in the midWillamette Valley occurs from April through September. Thus, rainfall averages during the growing season are uniform throughout the Eola Hills. The petitioners state that the Eola Hills are influenced more by their position due east of the Van Duzer corridor than by their location in the rain shadow of the Coast Range. Summer ocean winds vented through the corridor often cause dramatic late afternoon drops in temperature, which further distinguish the area from the hills further north. During the growing season, average maximum temperatures at the middle elevations range from 62 °F in April to 83 °F in July. These factors contribute to the ideal conditions for the ‘‘cool-climate’’ grape varieties that dominate in Eola Hills vineyards, such as Pinot Noir, Pinot Gris, and Chardonnay. The petitioners note that due to the effects of thermal inversion, during the growing season heat accumulation is greater on the slopes of the Eola Hills than on the floor of the surrounding Willamette Valley. Cool air, which drains toward the valley floor during the night, layers warmer air on the lower slopes. The petitioners submitted monthly heat accumulation data that compared a site at the Salem, OR airport on the valley floor with a site at the Seven Springs Vineyard in the Eola Hills for the years 1992–95. The data showed that, for those years, seasonal heat accumulation at the Seven Springs Vineyard site was consistently higher than that at the Salem airport site. Typically, the Seven Springs Vineyard site in the Eola Hills has, during the growing season (April 1 to October 31), a heat accumulation range of 2,300– 2,500 degree days, with a base of 60 °F. Based on standards for determining climatic regions using temperature summation, this heat accumulation range places the vineyard high in the PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 Region 1 category (2,500 degree days or less). Notice of Proposed Rulemaking On September 8, 2003, TTB published in the Federal Register (68 FR 52875) as Notice No. 15 a notice of proposed rulemaking regarding the establishment of the Eola Hills viticultural area. The comment period was originally scheduled to end on November 7, 2003. However, we received a request from a winery, Eola Hills Wine Cellars, Inc., of Salem, Oregon, to extend the comment period an additional 60 days. The winery stated it needed additional time to gather evidence to support its comment. In consideration of this and in light of the impact that the approval of the proposed Eola Hills viticultural area might have on Eola Hills Wine Cellars’ wine labels, we published Notice No. 22 on November 7, 2003 (68 FR 63042), extending the comment period to January 6, 2004. Comments Received TTB received 86 comments regarding the proposed Eola Hills viticultural area. Nearly all of the comments discussed the impact that establishment of an area named ‘‘Eola Hills’’ would have on Eola Hills Wine Cellars and its existing labels. Eola Hills Wine Cellars, in its comments, opposed the proposed name because it would severely restrict its ability to use its ‘‘Eola Hills’’ and ‘‘Eola Hills Wine Cellars’’ brand names. The winery noted that because it depends on grapes from outside the proposed Eola Hills viticultural area to produce the wines labeled with these brand names, its wines will not qualify for viticultural area labeling. At least 85 percent of the wine must be derived from grapes grown within the viticultural area in order for the winery to use its brand names. The winery stated that it must obtain some of its grapes from outside the Eola Hills area in order to maintain consistent production. Even though the winery has been using the ‘‘Eola Hills Wine Cellars’’ brand name on its labels since 1988, it is ineligible for the grandfather provision in 27 CFR 4.39(i)(2), which applies only to brand names used on certificates of label approval issued prior to July 7, 1986. The winery stated that it has worked for years building recognition for its brand names. To lose the use of these names would be, it stated, financially devastating to the winery. The winery also argued that naming the area ‘‘Eola Hills’’ will cause consumers to confuse wines labeled with the new viticultural area name with Eola Hills Wine Cellars’ wines. It E:\FR\FM\17JYR1.SGM 17JYR1 Federal Register / Vol. 71, No. 136 / Monday, July 17, 2006 / Rules and Regulations rmajette on PROD1PC67 with RULES contends that the Eola Hills area is known to consumers because of the reputation of Eola Hills Wine Cellars, and the petitioners are capitalizing on this reputation. In order to protect its name, the winery has applied for trademark status for its brand names with the U.S. Patent and Trademark Office. For these reasons, Eola Hills Wine Cellars urged that another name be used for the viticultural area. It proposed the names ‘‘Brunk House District,’’ ‘‘Eola/ Amity Hills District,’’ and ‘‘Amity Hills/ Eola Hills District’’ as alternative names. The winery also requested that it be granted an exemption under TTB regulations to continue to use its brand names, ‘‘Eola Hills’’ and ‘‘Eola Hills Wine Cellars,’’ on its wines regardless of the origin of the grapes used to produce the wine. The winery ended its comment by requesting that TTB hold a hearing regarding the naming of the viticultural area. Most of the other comments sympathized with the Eola Hills Wine Cellars position. Forty-one commenters stated that they opposed the new area unless a new name is found or some provision made allowing the winery unrestricted use of its brand names. Thirty other comments expressed support for the proposal as published, but urged that Eola Hills Wine Cellars be permitted to operate as if it were eligible for the grandfather provision of § 4.39(i). These commenters argued that the current grandfather date of July 7, 1986, is arbitrary and penalizes newer wine producing areas that have developed since that date. Several remaining comments expressed complete opposition to the proposal because of this issue, while a few expressed complete support. In an effort to find a solution to the problem, the petitioners submitted comments proposing new names for the area— Amity-Eola District, Aeolus Hills (District), and Aeolian Hills (District). They also requested that TTB create a grandfather clause that would permit Eola Hills Wine Cellars to continue using its brand names. Recently, the petitioners advised TTB by e-mail that they would accept a change in the proposed name to ‘‘Eola-Amity Hills.’’ TTB Finding After careful consideration of the evidence submitted in support of the petition and the public comments received, TTB finds that there is a substantial basis for the establishment of the viticultural area under the name ‘‘Eola-Amity Hills.’’ The petitioners submitted sufficient evidence of the viticultural distinctiveness of the VerDate Aug<31>2005 15:22 Jul 14, 2006 Jkt 208001 proposed area, and nothing in the comments contradicted that evidence. The petitioners also submitted sufficient evidence (discussed above under ‘‘Name Evidence’’) that a portion of the proposed viticultural area is known as ‘‘Amity Hills.’’ As explained earlier, the distinguishing features evidence for Eola Hills applies equally to the Amity Hills portion of the proposed area. Consumers therefore will know that the name ‘‘Eola-Amity Hills’’ refers to the area. Sufficient evidence was not submitted to support any of the other proposed alternative names. In addition, the name ‘‘Eola-Amity Hills’’ will adequately distinguish the viticultural area from the Eola Hills Wine Cellars brand name. Upon the effective date of this final rule, TTB will recognize only the entire name ‘‘Eola-Amity Hills’’ as having viticultural significance, and therefore Eola Hills Wine Cellars may continue to use its ‘‘Eola Hills’’ and ‘‘Eola Hills Wine Cellars’’ brand names on its wines. With the adoption of ‘‘EolaAmity Hills’’ as the name of the new viticultural area, it is not necessary to address the issue of a ‘‘grandfather’’ provision for Eola Hills Wine Cellars. TTB is not granting Eola Hills Wine Cellars’ request for a public hearing to discuss the name of the viticultural area. We have determined that a hearing is not necessary because the public record as described above provides a sufficient basis for a decision. Based on the above, we conclude that it is appropriate to establish the viticultural area under the name ‘‘EolaAmity Hills.’’ Therefore, under the authority of the Federal Alcohol Administration Act and part 4 of our regulations, we establish the Eola-Amity Hills viticultural area in Polk and Yamhill Counties, Oregon, effective 30 days from this document’s publication date. Boundary Description See the narrative boundary description of the viticultural area in the regulatory text published at the end of this document. Maps The maps for determining the boundary of the viticultural area are listed below in the 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. With the establishment of this viticultural area and its inclusion in part 9 of the TTB regulations, its name, ‘‘Eola-Amity PO 00000 Frm 00019 Fmt 4700 Sfmt 4700 40403 Hills’’ is recognized under 27 CFR 4.39(i)(3) as a name of viticultural significance. The text of the new regulation clarifies this point. Consequently, wine bottlers using ‘‘Eola-Amity Hills’’ 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. For a wine to be eligible to use as an appellation of origin a viticultural area name or other term specified as being viticulturally significant in part 9 of the TTB regulations, at least 85 percent of the wine must be derived from grapes grown within the area represented by that name or other term, 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 or other term as an appellation of origin and that name or term 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 or other term 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 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. Regulatory Flexibility Act We certify that this regulation will not have a significant economic impact on a substantial number of small entities. This regulation imposes no new reporting, recordkeeping, or other administrative requirements. Any benefit derived from the use of a viticultural area name is 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 Jennifer Berry of the Regulations and Rulings Division drafted this document. List of Subjects in 27 CFR Part 9 Wine. E:\FR\FM\17JYR1.SGM 17JYR1 40404 Federal Register / Vol. 71, No. 136 / Monday, July 17, 2006 / Rules and Regulations The Regulatory Amendment For the reasons discussed in the preamble, we amend 27 CFR, chapter 1, part 9, as follows: I PART 9—AMERICAN VITICULTURAL AREAS 1. The authority citation for part 9 continues to read as follows: I Authority: 27 U.S.C. 205. Subpart C—Approved American Viticultural Areas 2. Subpart C is amended by adding § 9.202 to read as follows: I rmajette on PROD1PC67 with RULES § 9.202 Eola-Amity Hills. (a) Name. The name of the viticultural area described in this section is ‘‘EolaAmity Hills’’. For purposes of part 4 of this chapter, ‘‘Eola-Amity Hills’’ is a term of viticultural significance. (b) Approved maps. The appropriate maps for determining the boundary of the Eola-Amity Hills viticultural area are six United States Geological Survey 1:24,000 scale topographic maps. They are titled— (1) Rickreall, Oregon, 1969, photorevised 1976; (2) Salem West, Oregon, 1969, photorevised 1986; (3) Mission Bottom, Oregon, 1957, revised 1993; (4) Dayton, Oregon, 1957, revised 1992; (5) McMinnville, Oregon, 1957, revised 1992; and (6) Amity, Oregon, 1957, revised 1993. (c) Boundary. The Eola-Amity Hills viticultural area is located in the State of Oregon, within Polk and Yamhill Counties, and is entirely within the Willamette Valley viticultural area. The area’s boundary is defined as follows— (1) The beginning point is on the Rickreall, Oregon, map, at the intersection of State Highways 22 and 223; (2) From the beginning point, proceed east on State Highway 22 to its intersection with Doaks Ferry Road on the Salem West, Oregon, map; then (3) Proceed northeast on Doaks Ferry Road to its intersection with the 200foot contour line southeast of Gibson Gulch, in section 65; then (4) Follow the 200-foot contour line in a westerly loop until it rejoins Doaks Ferry Road; then (5) Continue north on Doaks Ferry Road to its intersection with State Highway 221; then (6) Continue north on State Highway 221 to its intersection with the 200-foot contour line at the point where the VerDate Aug<31>2005 15:22 Jul 14, 2006 Jkt 208001 contour line departs from Highway 221 and runs southwest along the southern edge of Spring Valley (section 53 on the Mission Bottom, Oregon, map); then (7) Follow the 200-foot contour line first south onto the Salem West, Oregon, map, then northwest around the southern and western edge of Spring Valley and back on to the Mission Bottom, Oregon, map; then (8) Continue to follow the 200-foot contour line generally north on the Mission Bottom, Oregon, map, crossing onto and back from the Amity, Oregon, map and continue past the Yamhill County line and onto the Dayton, Oregon, map; then (9) Follow the 200-foot contour line from the Dayton, Oregon, map onto the McMinnville, Oregon, map and back to the Dayton, Oregon, map and continue around the northeast edge of the Amity Hills spur of the Eola Hills; then (10) Follow the 200-foot contour line onto the McMinnville, Oregon, map as it continues around the northern and western periphery of the Amity Hills spur; then (11) Follow the 200-foot contour line onto the Amity, Oregon, map as it heads first south, then generally southeast, then generally south, along the western edge of the Eola Hills until it intersects Old Bethel Road at a point just north of the Polk County line; then (12) Follow Old Bethel Road, which becomes Oak Grove Road, south until it intersects with the 200-foot contour line just northwest of the township of Bethel; then (13) Follow the 200-foot contour line around in a southeasterly loop until it again intersects Oak Grove Road where Oak Grove and Zena Roads intersect; then (14) Follow Oak Grove Road south until it intersects with Frizzell Road; then (15) Follow Frizzell Road west for three-tenths mile until it intersects with the 200-foot contour line; then (16) Follow the 200-foot contour line generally south until it intersects with the beginning point. Signed: May 9, 2006. John J. Manfreda, Administrator. Approved: June 15, 2006. Timothy E. Skud, Deputy Assistant Secretary (Tax, Trade, and Tariff Policy). [FR Doc. E6–11077 Filed 7–14–06; 8:45 am] BILLING CODE 4810–31–P PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 DEPARTMENT OF THE TREASURY Alcohol and Tobacco Tax and Trade Bureau 27 CFR Part 9 [T.D. TTB–50; Re: Notice No. 50] RIN 1513–AA82 thru 1513–AA88 Establishment of the Alta Mesa, Borden Ranch, Clements Hills, Cosumnes River, Jahant, Mokelumne River, and Sloughhouse Viticultural Areas Alcohol and Tobacco Tax and Trade Bureau, Treasury. ACTION: Final rule; Treasury decision. AGENCY: SUMMARY: This Treasury decision establishes seven new viticultural areas within the boundary of the existing Lodi viticultural area, which lies within southern Sacramento and northern San Joaquin Counties in California. The seven new areas are Alta Mesa, Borden Ranch, Clements Hills, Cosumnes River, Jahant, Mokelumne River, and Sloughhouse. 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. DATES: Effective Dates: August 16, 2006. FOR FURTHER INFORMATION CONTACT: N. A. Sutton, Alcohol and Tobacco Tax and Trade Bureau, Regulations and Rulings Division, 925 Lakeville St., 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 consumers with adequate information regarding product 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. E:\FR\FM\17JYR1.SGM 17JYR1

Agencies

[Federal Register Volume 71, Number 136 (Monday, July 17, 2006)]
[Rules and Regulations]
[Pages 40400-40404]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-11077]


-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[T.D. TTB-51; Re: Notice No. 15]
RIN 1513-AA41


Establishment of the Eola-Amity Hills Viticultural Area (2002R-
216P)

AGENCY: Alcohol and Tobacco Tax and Trade Bureau (TTB), Treasury.

ACTION: Final rule; Treasury decision.

-----------------------------------------------------------------------

SUMMARY: This Treasury decision establishes the Eola-Amity Hills 
viticultural area in Oregon. The viticultural area is entirely within 
the existing Willamette Valley viticultural area and encompasses 
roughly 37,900 acres within Polk and Yamhill Counties. 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.

DATES: Effective Date: August 16, 2006.

FOR FURTHER INFORMATION CONTACT: Jennifer Berry, Alcohol and Tobacco 
Tax and Trade Bureau, Regulations and Rulings Division, P.O. Box 18152, 
Roanoke, Virginia 24014; telephone 540-344-9333.

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 consumers with adequate information regarding product 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

[[Page 40401]]

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 geographical 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;
     Evidence relating to the geographical features, such as 
climate, soils, elevation, and physical features, that distinguish the 
proposed viticultural area from surrounding areas;
     A description of the specific boundary of the proposed 
viticultural area, based on features shown 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.

Rulemaking Proceedings

Eola Hills Petition

    Mr. Russell Raney of Evesham Wood Vineyard and Mr. Ted Casteel of 
Bethel Heights Vineyard, both of Salem, Oregon, petitioned TTB for the 
establishment of a viticultural area to be called ``Eola Hills.'' The 
proposed viticultural area is within the State of Oregon and entirely 
within the existing Willamette Valley viticultural area described in 27 
CFR 9.90. The petitioners estimate that the proposed area encompasses 
37,900 acres, about 1,244 acres of which are planted to vines. At the 
time of the petition, 12 wineries operated within the proposed area. We 
summarize below the evidence submitted with the petition.

Name Evidence

    As historical evidence of the use of the name ``Eola Hills,'' the 
petitioners submitted an excerpt from ``Oregon Geographic Names'' 
(published by the Oregon Historical Society, 5th edition, 1982, pp. 
294-295). This source states that the Eola Hills were named for the 
village of Eola, situated at the southern end of the ridge. On January 
17, 1856, the Oregon territorial legislature incorporated the village 
as ``Eola,'' a name derived from Aeolus, the Classical Greek god of 
winds. The source further states that the Eola Hills ``constitute one 
of the important groups of isolated hills in the Willamette Valley.'' 
It goes on to explain that the hills have been known by other names, 
but the name ``Eola Hills seems firmly established.''
    For additional name evidence, the petitioners also submitted 
several maps that identify the area as ``Eola Hills.'' Four of the USGS 
maps used to show the boundaries (Rickreall, Salem West, Mission 
Bottom, and Amity) identify the area as Eola Hills. The petitioners 
also submitted two geologic maps of the area issued by the State of 
Oregon's Department of Geology and Mineral Industries. Both prominently 
label the area ``Eola Hills.''
    According to the petitioners, Eola Hills has name recognition and a 
reputation for quality among wine consumers both in and outside of 
Oregon. For this reason, vineyards and wineries within the area utilize 
the name frequently in their promotional literature. The petitioners 
submitted two promotional maps demonstrating this fact. One map, 
entitled ``The Wine Appellations of Oregon,'' issued by the Oregon Wine 
Marketing Coalition, portrays the Eola Hills area as a subregion within 
the Willamette Valley. The other map, entitled ``Eola Hills Winegrowing 
Region, Willamette Valley Oregon,'' shows the location of all vineyards 
and wineries in the area.
    The petitioners note that a small portion of the proposed 
viticultural area is sometimes referred to as ``Amity Hills.'' ``Oregon 
Geographic Names'' describes the Amity Hills as a northern extension of 
the Eola Hills separated from the main ridge by a pass east of the town 
of Amity. USGS maps for McMinnville and Amity, Oregon, identify this 
area as Amity Hills. However, the geologic maps issued by Oregon's 
Department of Geology and Mineral Industries identify this area as part 
of the Eola Hills. The petitioners argue that, for the purpose of wine 
designation, consumers in Oregon have come to recognize the entire area 
as a single unit known as ``Eola Hills.'' They also state that vintners 
in the Amity Hills portion of the area support the designation of Eola 
Hills for the entire area.

Boundary Evidence

    As evidence of the boundary, the petitioners submitted with the 
petition six USGS topographic maps on which the Eola Hills are dominant 
features. The main ridge of the Eola Hills runs north to south, 
starting approximately 5\3/4\ miles northeast of the town of Amity and 
extending south for 16 miles to Oregon Highway 22, just north of the 
Willamette River at West Salem. At their widest point, toward the 
southern end, the Eola Hills are about 6\1/2\ miles across, from 
Wallace Road in the east to U.S. Highway 99 in the west.
    The petitioners use the 200-foot contour line as the predominant 
boundary marker. They note that they occasionally diverge to use roads 
or highways where they form a more convenient boundary and to exclude 
land not deemed suitable for grape cultivation due to soil type, 
elevation, or urban development.

Distinguishing Features

Soils and Geology
    The petitioners state that the soils and geology of the Eola Hills, 
compared to those of the surrounding areas, are distinctive in two 
regards. The petitioners note that the prevailing basalt-derived soils 
of the Eola Hills are shallower than the soils of other hills in the 
north Willamette Valley, and that these well drained basalt soils are 
very different from the alluvial soils of the surrounding valley floor.
    As evidence of these differences, the petitioners submitted two 
geologic maps issued by the State of Oregon's Department of Geology and 
Mineral Industries. One is entitled ``Geologic Map of the Rickreall and 
Salem Quadrangles, Oregon;'' the other is entitled ``Preliminary 
Geologic Map of the Amity and Mission Bottom Quadrangles, Oregon.'' 
According to these documents, volcanic basalt rock from the lava flows 
of the Miocene epoch underlies the Eola Hills, and marine sedimentary 
rock of the Oligocene epoch underlies areas at the lower elevations of 
the ridge. The soils

[[Page 40402]]

at the middle and higher elevations of the Eola Hills are largely well 
drained silty clay loams weathered from basalt; those on the lower 
slopes are silt loams weathered predominantly from sedimentary rock, 
particularly on the west-facing slopes.
    According to soil survey maps issued by the U.S. Department of 
Agriculture, Soil Conservation Service, the dominant basalt-derived 
soils on the Eola Hills are Nekia soils (recently reclassified as 
Gelderman soils) and Ritner and Jory soils. The preponderance of the 
shallower Nekia and Gelderman soils in the Eola Hills differentiates 
the Eola Hills from the Red Hills farther north, where Jory soils are 
predominant. Nekia and Gelderman soils have a much lower available 
water capacity than Jory soils. The most common sedimentary soils on 
the Eola Hills are Steiwer, Chehulpum, and Helmick soils, especially on 
the west side of the ridge. Also in the Eola Hills are soils formed in 
alluvial deposits, the most common of which are the silt loam Woodburn 
soils. Such alluvial soils generally are only at the lowest elevations 
of the proposed viticultural area (below 300 feet). Like the soils 
mentioned above, these alluvial soils also are suitable for wine grapes 
if they are on slopes steep enough for good water drainage.
    Finally, the Eola Hills are surrounded on almost all sides by, and 
are easily distinguished from, terraces of the Willamette Valley. With 
few exceptions, the terraces lie below the 200-foot elevation line and 
are characterized by less drained alluvial soils. According to the 
petitioners, the soils on these terraces generally are not suitable for 
the cultivation of premium wine grapes. Therefore, land below an 
elevation of 200 feet is not included within the proposed Eola Hills 
boundary.
Topography
    The main ridge of the Eola Hills runs north-south and has numerous 
lateral ridges that run east-west on both sides. Slopes on the west 
side of the ridge tend to be somewhat steeper and pocketed, and they 
fall away below an elevation of 200 feet more abruptly than the slopes 
on the east side, which tend to be gentler and more extensive. Both 
sides, however, provide vineyard sites with very similar soils and 
growing conditions. The highest point in the south end of the hills is 
1,093 feet. In the central area, near the Polk-Yamhill County line, the 
ridge peaks at around 1,160 feet; in the north, it peaks at 863 feet. 
The majority of vineyards in the Eola Hills are at elevations ranging 
from 250 to 700 feet, although suitable sites, given proper sun 
exposure and microclimate, are found above these elevations. Most 
vineyards in the Eola Hills have a southern, southwestern, or 
southeastern orientation. However, on gently sloping terrain, east- and 
west-facing sites are also capable of producing high quality wine 
grapes.
Climate
    According to the petitioners, the Eola Hills are blessed with a 
temperate climate. Summers are warm, but seldom excessively hot; 
winters are mild, and in winter, temperatures are usually above 
freezing. Annual rainfall ranges from under 40 inches on the 
southeastern edge of the Eola Hills to more than 45 inches in the 
higher elevations. More important, only about 15 percent of the total 
annual rainfall in the mid-Willamette Valley occurs from April through 
September. Thus, rainfall averages during the growing season are 
uniform throughout the Eola Hills.
    The petitioners state that the Eola Hills are influenced more by 
their position due east of the Van Duzer corridor than by their 
location in the rain shadow of the Coast Range. Summer ocean winds 
vented through the corridor often cause dramatic late afternoon drops 
in temperature, which further distinguish the area from the hills 
further north. During the growing season, average maximum temperatures 
at the middle elevations range from 62 [deg]F in April to 83 [deg]F in 
July. These factors contribute to the ideal conditions for the ``cool-
climate'' grape varieties that dominate in Eola Hills vineyards, such 
as Pinot Noir, Pinot Gris, and Chardonnay.
    The petitioners note that due to the effects of thermal inversion, 
during the growing season heat accumulation is greater on the slopes of 
the Eola Hills than on the floor of the surrounding Willamette Valley. 
Cool air, which drains toward the valley floor during the night, layers 
warmer air on the lower slopes. The petitioners submitted monthly heat 
accumulation data that compared a site at the Salem, OR airport on the 
valley floor with a site at the Seven Springs Vineyard in the Eola 
Hills for the years 1992-95. The data showed that, for those years, 
seasonal heat accumulation at the Seven Springs Vineyard site was 
consistently higher than that at the Salem airport site. Typically, the 
Seven Springs Vineyard site in the Eola Hills has, during the growing 
season (April 1 to October 31), a heat accumulation range of 2,300-
2,500 degree days, with a base of 60 [deg]F. Based on standards for 
determining climatic regions using temperature summation, this heat 
accumulation range places the vineyard high in the Region 1 category 
(2,500 degree days or less).

Notice of Proposed Rulemaking

    On September 8, 2003, TTB published in the Federal Register (68 FR 
52875) as Notice No. 15 a notice of proposed rulemaking regarding the 
establishment of the Eola Hills viticultural area. The comment period 
was originally scheduled to end on November 7, 2003. However, we 
received a request from a winery, Eola Hills Wine Cellars, Inc., of 
Salem, Oregon, to extend the comment period an additional 60 days. The 
winery stated it needed additional time to gather evidence to support 
its comment. In consideration of this and in light of the impact that 
the approval of the proposed Eola Hills viticultural area might have on 
Eola Hills Wine Cellars' wine labels, we published Notice No. 22 on 
November 7, 2003 (68 FR 63042), extending the comment period to January 
6, 2004.

Comments Received

    TTB received 86 comments regarding the proposed Eola Hills 
viticultural area. Nearly all of the comments discussed the impact that 
establishment of an area named ``Eola Hills'' would have on Eola Hills 
Wine Cellars and its existing labels.
    Eola Hills Wine Cellars, in its comments, opposed the proposed name 
because it would severely restrict its ability to use its ``Eola 
Hills'' and ``Eola Hills Wine Cellars'' brand names. The winery noted 
that because it depends on grapes from outside the proposed Eola Hills 
viticultural area to produce the wines labeled with these brand names, 
its wines will not qualify for viticultural area labeling. At least 85 
percent of the wine must be derived from grapes grown within the 
viticultural area in order for the winery to use its brand names. The 
winery stated that it must obtain some of its grapes from outside the 
Eola Hills area in order to maintain consistent production. Even though 
the winery has been using the ``Eola Hills Wine Cellars'' brand name on 
its labels since 1988, it is ineligible for the grandfather provision 
in 27 CFR 4.39(i)(2), which applies only to brand names used on 
certificates of label approval issued prior to July 7, 1986. The winery 
stated that it has worked for years building recognition for its brand 
names. To lose the use of these names would be, it stated, financially 
devastating to the winery.
    The winery also argued that naming the area ``Eola Hills'' will 
cause consumers to confuse wines labeled with the new viticultural area 
name with Eola Hills Wine Cellars' wines. It

[[Page 40403]]

contends that the Eola Hills area is known to consumers because of the 
reputation of Eola Hills Wine Cellars, and the petitioners are 
capitalizing on this reputation. In order to protect its name, the 
winery has applied for trademark status for its brand names with the 
U.S. Patent and Trademark Office.
    For these reasons, Eola Hills Wine Cellars urged that another name 
be used for the viticultural area. It proposed the names ``Brunk House 
District,'' ``Eola/Amity Hills District,'' and ``Amity Hills/Eola Hills 
District'' as alternative names. The winery also requested that it be 
granted an exemption under TTB regulations to continue to use its brand 
names, ``Eola Hills'' and ``Eola Hills Wine Cellars,'' on its wines 
regardless of the origin of the grapes used to produce the wine. The 
winery ended its comment by requesting that TTB hold a hearing 
regarding the naming of the viticultural area.
    Most of the other comments sympathized with the Eola Hills Wine 
Cellars position. Forty-one commenters stated that they opposed the new 
area unless a new name is found or some provision made allowing the 
winery unrestricted use of its brand names. Thirty other comments 
expressed support for the proposal as published, but urged that Eola 
Hills Wine Cellars be permitted to operate as if it were eligible for 
the grandfather provision of Sec.  4.39(i). These commenters argued 
that the current grandfather date of July 7, 1986, is arbitrary and 
penalizes newer wine producing areas that have developed since that 
date. Several remaining comments expressed complete opposition to the 
proposal because of this issue, while a few expressed complete support. 
In an effort to find a solution to the problem, the petitioners 
submitted comments proposing new names for the area--Amity-Eola 
District, Aeolus Hills (District), and Aeolian Hills (District). They 
also requested that TTB create a grandfather clause that would permit 
Eola Hills Wine Cellars to continue using its brand names. Recently, 
the petitioners advised TTB by e-mail that they would accept a change 
in the proposed name to ``Eola-Amity Hills.''

TTB Finding

    After careful consideration of the evidence submitted in support of 
the petition and the public comments received, TTB finds that there is 
a substantial basis for the establishment of the viticultural area 
under the name ``Eola-Amity Hills.'' The petitioners submitted 
sufficient evidence of the viticultural distinctiveness of the proposed 
area, and nothing in the comments contradicted that evidence. The 
petitioners also submitted sufficient evidence (discussed above under 
``Name Evidence'') that a portion of the proposed viticultural area is 
known as ``Amity Hills.'' As explained earlier, the distinguishing 
features evidence for Eola Hills applies equally to the Amity Hills 
portion of the proposed area. Consumers therefore will know that the 
name ``Eola-Amity Hills'' refers to the area. Sufficient evidence was 
not submitted to support any of the other proposed alternative names. 
In addition, the name ``Eola-Amity Hills'' will adequately distinguish 
the viticultural area from the Eola Hills Wine Cellars brand name.
    Upon the effective date of this final rule, TTB will recognize only 
the entire name ``Eola-Amity Hills'' as having viticultural 
significance, and therefore Eola Hills Wine Cellars may continue to use 
its ``Eola Hills'' and ``Eola Hills Wine Cellars'' brand names on its 
wines. With the adoption of ``Eola-Amity Hills'' as the name of the new 
viticultural area, it is not necessary to address the issue of a 
``grandfather'' provision for Eola Hills Wine Cellars.
    TTB is not granting Eola Hills Wine Cellars' request for a public 
hearing to discuss the name of the viticultural area. We have 
determined that a hearing is not necessary because the public record as 
described above provides a sufficient basis for a decision.
    Based on the above, we conclude that it is appropriate to establish 
the viticultural area under the name ``Eola-Amity Hills.'' Therefore, 
under the authority of the Federal Alcohol Administration Act and part 
4 of our regulations, we establish the Eola-Amity Hills viticultural 
area in Polk and Yamhill Counties, Oregon, effective 30 days from this 
document's publication date.

Boundary Description

    See the narrative boundary description of the viticultural area in 
the regulatory text published at the end of this document.

Maps

    The maps for determining the boundary of the viticultural area are 
listed below in the 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. With the establishment of this viticultural area and 
its inclusion in part 9 of the TTB regulations, its name, ``Eola-Amity 
Hills'' is recognized under 27 CFR 4.39(i)(3) as a name of viticultural 
significance. The text of the new regulation clarifies this point. 
Consequently, wine bottlers using ``Eola-Amity Hills'' 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.
    For a wine to be eligible to use as an appellation of origin a 
viticultural area name or other term specified as being viticulturally 
significant in part 9 of the TTB regulations, at least 85 percent of 
the wine must be derived from grapes grown within the area represented 
by that name or other term, 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 or other term as an appellation of origin and 
that name or term 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 or 
other term 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 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.

Regulatory Flexibility Act

    We certify that this regulation will not have a significant 
economic impact on a substantial number of small entities. This 
regulation imposes no new reporting, recordkeeping, or other 
administrative requirements. Any benefit derived from the use of a 
viticultural area name is 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

    Jennifer Berry of the Regulations and Rulings Division drafted this 
document.

List of Subjects in 27 CFR Part 9

    Wine.

[[Page 40404]]

The Regulatory Amendment

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. Subpart C is amended by adding Sec.  9.202 to read as follows:


Sec.  9.202  Eola-Amity Hills.

    (a) Name. The name of the viticultural area described in this 
section is ``Eola-Amity Hills''. For purposes of part 4 of this 
chapter, ``Eola-Amity Hills'' is a term of viticultural significance.
    (b) Approved maps. The appropriate maps for determining the 
boundary of the Eola-Amity Hills viticultural area are six United 
States Geological Survey 1:24,000 scale topographic maps. They are 
titled--
    (1) Rickreall, Oregon, 1969, photorevised 1976;
    (2) Salem West, Oregon, 1969, photorevised 1986;
    (3) Mission Bottom, Oregon, 1957, revised 1993;
    (4) Dayton, Oregon, 1957, revised 1992;
    (5) McMinnville, Oregon, 1957, revised 1992; and
    (6) Amity, Oregon, 1957, revised 1993.
    (c) Boundary. The Eola-Amity Hills viticultural area is located in 
the State of Oregon, within Polk and Yamhill Counties, and is entirely 
within the Willamette Valley viticultural area. The area's boundary is 
defined as follows--
    (1) The beginning point is on the Rickreall, Oregon, map, at the 
intersection of State Highways 22 and 223;
    (2) From the beginning point, proceed east on State Highway 22 to 
its intersection with Doaks Ferry Road on the Salem West, Oregon, map; 
then
    (3) Proceed northeast on Doaks Ferry Road to its intersection with 
the 200-foot contour line southeast of Gibson Gulch, in section 65; 
then
    (4) Follow the 200-foot contour line in a westerly loop until it 
rejoins Doaks Ferry Road; then
    (5) Continue north on Doaks Ferry Road to its intersection with 
State Highway 221; then
    (6) Continue north on State Highway 221 to its intersection with 
the 200-foot contour line at the point where the contour line departs 
from Highway 221 and runs southwest along the southern edge of Spring 
Valley (section 53 on the Mission Bottom, Oregon, map); then
    (7) Follow the 200-foot contour line first south onto the Salem 
West, Oregon, map, then northwest around the southern and western edge 
of Spring Valley and back on to the Mission Bottom, Oregon, map; then
    (8) Continue to follow the 200-foot contour line generally north on 
the Mission Bottom, Oregon, map, crossing onto and back from the Amity, 
Oregon, map and continue past the Yamhill County line and onto the 
Dayton, Oregon, map; then
    (9) Follow the 200-foot contour line from the Dayton, Oregon, map 
onto the McMinnville, Oregon, map and back to the Dayton, Oregon, map 
and continue around the northeast edge of the Amity Hills spur of the 
Eola Hills; then
    (10) Follow the 200-foot contour line onto the McMinnville, Oregon, 
map as it continues around the northern and western periphery of the 
Amity Hills spur; then
    (11) Follow the 200-foot contour line onto the Amity, Oregon, map 
as it heads first south, then generally southeast, then generally 
south, along the western edge of the Eola Hills until it intersects Old 
Bethel Road at a point just north of the Polk County line; then
    (12) Follow Old Bethel Road, which becomes Oak Grove Road, south 
until it intersects with the 200-foot contour line just northwest of 
the township of Bethel; then
    (13) Follow the 200-foot contour line around in a southeasterly 
loop until it again intersects Oak Grove Road where Oak Grove and Zena 
Roads intersect; then
    (14) Follow Oak Grove Road south until it intersects with Frizzell 
Road; then
    (15) Follow Frizzell Road west for three-tenths mile until it 
intersects with the 200-foot contour line; then
    (16) Follow the 200-foot contour line generally south until it 
intersects with the beginning point.

    Signed: May 9, 2006.
John J. Manfreda,
Administrator.
    Approved: June 15, 2006.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).
 [FR Doc. E6-11077 Filed 7-14-06; 8:45 am]
BILLING CODE 4810-31-P
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