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###### Department of the Treasury

###### Alcohol and Tobacco Tax and Trade Bureau 

          - 27 CFR Part 9 
          - [Notice No. 25] 
          - RIN 1513-AA77 

# AGENCY:

Alcohol and Tobacco Tax and Trade Bureau, Treasury. 

# ACTION:

Notice of proposed rulemaking. 

# SUMMARY:

The Alcohol and Tobacco Tax and Trade Bureau proposes to establish the “Texoma” viticultural area in north-central Texas in Montague, Cooke, Grayson, and Fannin Counties. The proposed area consists of approximately 3,650 square miles on the southern side of Lake Texoma and the Red River, along the Texas-Oklahoma State line. We designate viticultural areas to allow bottlers to better describe the origin of wines and allow consumers to better identify the wines they may purchase. We invite comments on this proposed addition to our regulations. 

# DATES:

We must receive written comments on or before January 31, 2005. 

# ADDRESSES:

You may send comments to any of the following addresses: 
      - Chief, Regulations and Procedures Division, Alcohol and Tobacco Tax and Trade Bureau, Attn: Notice No. 25, P.O. Box 14412, Washington, DC 20044-4412.
      - 202-927-8525 (facsimile).
      -  nprm@ttb.gov                          (e-mail).                     
      -  http://www.ttb.gov/​alcohol/​rules/​index.htm . An online comment form is posted with this notice on our Web site.                     
      -  http://www.regulations.gov                          (Federal e-rulemaking portal; follow instructions for submitting comments).                     

                        You may view copies of this notice, the petition, the appropriate maps, and any comments we receive about this notice by appointment at the TTB Library, 1310 G Street, NW., Washington, DC 20220. To make an appointment, call 202-927-2400. You may also access copies of the notice and comments online at                         *http://www.ttb.gov/​alcohol/​rules/​index.htm*.                     

See the Public Participation section of this notice for specific instructions and requirements for submitting comments, and for information on how to request a public hearing. 

# FOR FURTHER INFORMATION CONTACT:

                        Jennifer Berry, Alcohol and Tobacco Tax and Trade Bureau, Regulations and                               ( print page 69558)                            Procedures Division, P.O. Box 18152, Roanoke, VA 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 the consumer with adequate information regarding a product's identity and prohibits the use of misleading information on such labels. The FAA Act also authorizes the Secretary of the Treasury to issue regulations to carry out its provisions. The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers these regulations.                 

Part 4 of the TTB regulations (27 CFR part 4) allows the establishment of definitive viticultural areas and the use of their names as appellations of origin on wine labels and in wine advertisements. Part 9 of the TTB regulations (27 CFR part 9) contains the list of approved viticultural areas. 

### Definition 

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

### Requirements 

Section 4.25(e)(2) of the TTB regulations outlines the procedure for proposing an American viticultural area and provides that any interested party may petition TTB to establish a grape-growing region as a viticultural area. Section 9.3(b) of the TTB regulations requires the petition to include— 
    - Evidence that the proposed viticultural area is locally and/or nationally known by the name specified in the petition;
    - Historical or current evidence that supports setting the boundary of the proposed viticultural area as the petition specifies;
    - 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 found on United States Geological Survey (USGS) maps; and
    - A copy of the appropriate USGS map(s) with the proposed viticultural area's boundary prominently marked.

## Texoma Petition 

                    The Texoma Appellation Committee, Denison, Texas, has petitioned TTB to establish the “Texoma” viticultural area in north-central Texas. Located along the Texas-Oklahoma State line on the southern side of Lake Texoma and the Red River, the proposed area covers 3,650 square miles, or about 2.3 million acres, in Montague, Cooke, Grayson, and Fannin Counties. According to the petitioners, the area contains four wineries and a number of small vineyards with approximately 55 acres planted to vines. The petitioners state that both                     *Vitis vinifera*                     and native Texas grape varieties thrive in Texoma.                 

### Name Evidence 

The name “Texoma” originates with Lake Texoma, a large Army Corps of Engineers lake on the Texas-Oklahoma State line. According to the petitioners, people have referred to the proposed area as “Texoma” for over 60 years, roughly since the completion of Lake Texoma in 1938. 

The petition included numerous examples of the use of the name “Texoma” by businesses and governments serving the four-county (Montague, Cooke, Grayson, and Fannin) area. Examples include: the Texoma Regional Health Care system, the Texoma Association of Realtors, the Texoma Council of Governments, the Texoma Women's and Children's Center, Texoma Workforce Commission, Texoma Center for Family Medicine, Texoma Christian Middle School, and the Texoma Council for the Deaf. 

The petitioners state that an Internet search for the word “Texoma” returned 6,407 pages of references. None refers to a location outside the four-county area. 

The petitioners note that several counties in southern Oklahoma are usually included in the Texoma region. However, the petitioners state that Oklahoma State winery fees have prevented the establishment of a successful wine district on the northern side of the State line. 

### Boundary Evidence 

The petitioners state that the proposed Texoma viticultural area's boundaries encompass the sloping pastureland in this portion of the Red River drainage basin. While the Red River and Lake Texoma form the proposed area's northern boundary, the ridge between the Red River drainage basin and the Trinity River drainage basin form its southern boundary. The Montague County line forms most of the western boundary, while the Fannin County line forms most of the eastern boundary. 

The petitioners assert that the proposed area's boundaries correspond to those of the Texoma region of Texas. The petitioners further state that Texoma has unique growing conditions—soils, topography, and climate—that are advantageous for grape growing. 

As historical evidence for the proposed boundaries, the petitioners cite Texoma's contributions to world viticultural history. Renowned 19th-century viticulturalist Thomas Volney (T.V.) Munson chose Texoma as the site for his experimental vineyards. An expert on native American grape varieties, he was particularly excited by Texoma's varieties of native grapes, calling the area his “grape paradise.” He developed over 300 new grape varieties from the wild grapes growing along the bluffs of the Red River and its tributaries. When phylloxera threatened to destroy French vineyards, Munson shipped thousands of phylloxera-resistant Texas rootstocks to France and had them grafted with European vinifera varieties. In 1888, the French government awarded Munson the French Legion of Honor for his role in saving their wine industry. 

Today, the T.V. Munson Memorial Vineyard at Grayson County College in Denison, Texas, carries on Munson's legacy. The vineyard grows 65 of the 300 grape varieties developed by Munson, and the college, unlike most junior colleges in the nation, bestows associate degrees in viticulture. 

                    Because of the importance of native grape species to the viticultural history and identity of the Texoma region, the petitioners based their southern boundary in part on the distribution of wild grapevines through the area. Because wild grapevines generally do not grow on the south-facing slopes beyond the ridge dividing the Red River and Trinity River drainage basins, the petitioners excluded certain southern portions of the four counties from the proposed Texoma area.                           ( print page 69559)    

### Growing Conditions 

#### Soils 

The petitioners state that Texoma soils differ from the soils in surrounding areas. Texoma contains sandy, loamy soils that provide good drainage for vineyards. Surrounding areas contain black-land soils, which do not provide good drainage for vineyards. The petitioners note that some areas south and southwest of the proposed viticultural area also have sandy, loamy soils, but that these soils lie outside the boundaries of the Texoma area. The petitioners state that, unlike the soils of surrounding areas, Texoma's soils, because of their sandiness, contain practically no phylloxera. 

The petitioners submitted a detailed soil report on the Texoma area prepared by a committee of soil scientists: Maurice Jurena and Jerry Rives of the U.S. Department of Agriculture's Natural Resources Conservation Service, Dr. George McEachern of Texas A&M University, and Dr. Charles E. Pehl, a private consultant. The report lists 36 soil series suitable for viticulture in the proposed area. Maps show these soil series throughout the Texoma area. According to the authors, these soils have the characteristics needed for productive vineyards—good internal drainage, adequate soil depth, and good water-holding capacity. Based on available soil surveys of the area, the authors state that approximately one-third of the proposed area, an estimated 690,000 acres (1,078 sq. miles), should be suitable for productive viticulture. The report describes three soils of particular interest: 

The Hicota series consists of fine sandy loams that are deep, moderately well drained, slowly permeable, and have good water holding capacity. These soils are found on the high terraces mainly along the Red River. Formed in loamy alluvium, their slopes range from 0 to 3 percent * * *. 

The Freestone series consists of fine sandy loams that are very deep, moderately well drained, slowly permeable, and have good water holding capacity. These soils are found on Pleistocene terraces of remnant terraces on upland positions. Formed in loamy and clayey sediments, their slopes vary from 0 to 5 percent. The soils have aquic soil moisture conditions due to an extremely thin area of episaturation above the clay layer in the spring at a depth of 20 to 40 inches during most years. 

The Frioton series consists of silty clay loams that are very deep, well drained, moderately slowly permeable, with good water holding capacity. Formed in loamy and clayey Pleistocene sediments on nearly level flood plains, their slopes range from 0 to 1 percent. They may be flooded for very brief periods during the months of February to July. 

As additional soil evidence, the petitioners submitted soil survey maps published by the Natural Resources Conservation Service, U.S. Department of Agriculture, for each of the four counties in the proposed area. These maps consistently describe the various soils of Texoma, including those detailed in the petitioner's soil report, as either “loamy and sandy” or “loamy and clayey.” 

#### Topography 

The petitioners state that much of Texoma's land slopes downward and northward toward the Red River. The elevation ranges from a low of 597 feet above sea level in northeast Fannin County to a high of 1,271 feet on ridges in southeast Montague County. Evening breezes drain the intense heat of the day off Texoma's bluffs and rolling hillsides, cooling the vineyards. Numerous small creeks flow northward to Lake Texoma and the Red River throughout Texoma. Several varieties of wild grapes grow in these creek beds, just as they did in the days of T.V. Munson. 

According to the petitioners, Texoma's north-facing slopes (3 percent to 12 percent slope) diminish the power of the summer sun and thus provide excellent vineyard sites. The petitioners state that recent research indicates that, in June, 15-degree north-facing slopes can reduce the sunlight index from 107 to 86. (The sunlight index is a scale measuring the amount of solar radiation received by plants.) This results in significantly less heat stress on the vines. In September, the effect is even greater, with the sunlight index reduced from 122 to 70. The petitioners contrast this with land south of Texoma in the Dallas-Fort Worth area. There the land slopes south, resulting in a much higher sunlight index and greater heat stress on grape vines. 

The petitioners note that, in addition to Lake Texoma, the Texoma area has numerous lakes and ponds. These bodies of water provide a large reserve for irrigating the area's vineyards. The petitioners also believe that sunlight reflecting off these bodies of water helps to ripen grapes. They note that a similar effect occurs in New York's Finger Lakes region and in Germany's Mosel and Rhine River valleys. Gentle breezes off Lake Texoma provide advection warming to the surrounding hillsides during cool autumn nights. 

#### Climate 

According to the petitioners, Texoma's climate is favorable for grape growing, while the climate of surrounding areas is not. Texoma's temperatures for November through February generally are 5.3 to 6.7 degrees cooler than those in areas to the south and southeast, such as the Dallas-Fort Worth area (which averages 33.6° F) and Greenville, Texas (which averages 34.9° F). Texoma's winter temperatures in the mid- and upper-20s are cold enough to kill the insect that causes Pierce's disease, while causing no damage to vineyards. The petitioners state that vineyards in the Dallas-Fort Worth area have, in contrast, suffered extensive damage from Pierce's disease. 

Areas north and west of Texoma, such as Oklahoma and northwestern Texas, have winter temperatures that are 4 to 6 degrees colder than Texoma's. These temperatures increase the risk of damage to vines. Freeze and thaw cycles in these areas can split vine trunks, while the milder winter temperatures of Texoma prevent such damage. 

The petitioners assert that Texoma's precipitation is also favorable for grape growing. While its vineyards rely to some extent on irrigation, Texoma receives an annual rainfall of 30 to 40 inches, which is close to sufficient. As one heads west from Texoma, the climate is increasingly drier. Wichita Falls, Texas, for example, receives only 28 inches of rain a year, an amount that cannot sustain vineyards. Few sources of water for irrigation, such as Lake Texoma, exist west of Texoma. Areas east of Texoma receive much heavier rainfall, as much as 51 inches annually in Texarkana. Such heavy rainfall often results in standing water, which can cause root rot and kill vines. 

### Boundary Description 

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

### Maps 

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

## Impact on Current Wine Labels 

                    Part 4 of the TTB regulations prohibits any label reference on a wine that indicates or implies an origin other than the wine's true place of origin. If we establish this proposed viticultural area, its name, “Texoma,” will be recognized as a name of viticultural significance. Consequently, wine bottlers using “Texoma” in a brand name, including a trademark, or in another label reference as to the origin of the wine, will have to ensure that the product is eligible to use the viticultural area's name as an appellation of origin. The proposed part 9 regulatory text set forth in this                           ( print page 69560)                        document specifies the “Texoma” name as a term of viticultural significance for purposes of part 4 of the TTB regulations.                 

For a wine to be eligible to use as an appellation of origin the name of a viticultural area specified in part 9 of the TTB regulations, at least 85 percent of the grapes used to make the wine must have been grown within the area represented by that name. If the wine is not eligible to use the viticultural area name as an appellation of origin and that name appears in the brand name, then the label is not in compliance and the bottler must change the brand name and obtain approval of a new label. Similarly, if the viticultural area name appears in another reference on the label in a misleading manner, the bottler would have to obtain approval of a new label. Accordingly, if a new label or a previously approved label uses the name “Texoma” for a wine that does not meet the 85 percent standard, the new label will not be approved, and the previously approved label will be subject to revocation, upon the effective date of the approval of the Texoma viticultural area. 

Different rules apply if a wine has a brand name containing a viticultural area name that was used as a brand name on a label approved before July 7, 1986. See 27 CFR 4.39(i)(2) for details. 

## Public Participation 

### Comments Invited 

We invite comments from interested members of the public on whether we should establish the proposed viticultural area. We are also interested in receiving comments on the sufficiency and accuracy of the name, climactic, boundary, and other required information submitted in support of the petition. Please provide any available specific information in support of your comments. In addition, TTB is interested in comments concerning the exclusion of those counties in Oklahoma that are considered to be within the Texoma region from the petitioned viticultural area. This includes information on any wine grape growing in those Oklahoma counties. 

Because of the potential impact of the establishment of the proposed Texoma viticultural area on brand labels that include the words “Texoma” as discussed above under Impact on Current Wine Labels, we are particularly interested in comments regarding whether there will be a conflict between the proposed area name and currently used brand names. If a commenter believes that a conflict will arise, the comment should describe the nature of that conflict, including any negative economic impact that approval of the proposed viticultural area will have on an existing viticultural enterprise. We are also interested in receiving suggestions for ways to avoid any conflicts, for example by adopting a modified or different name for the viticultural area. 

### Confidentiality 

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

## Submitting Comments 

Please submit your comments by the closing date shown above in this notice. All comments must include this notice number and your name and mailing address. Your comments must be legible and written in language acceptable for public disclosure. We do not acknowledge receipt of comments, and we regard all comments as originals. 

You may submit comments in any of five ways:
    -  Mail:                      You may send written comments to TTB at the address listed in the                      ADDRESSES                      section.                 
    -  Facsimile:                      You may submit comments by facsimile transmission to 202-927-8525. Faxed comments must—                

(1) Be on 8.5- by 11-inch paper; 

(2) Contain a legible, written signature; and 

(3) Be no more than five pages long. This limitation assures electronic access to our equipment. We will not accept faxed comments that exceed five pages. 
    -  E-mail:                      You may e-mail comments to                      nprm@ttb.gov . Comments transmitted by electronic mail must—                

(1) Contain your e-mail address; 

(2) Reference this notice number on the subject line; and 

(3) Be legible when printed on 8.5- by 11-inch paper. 
    -  Online form:                      We provide a comment form with the online copy of this notice on our Web site at                      http://www.ttb.gov/​alcohol/​rules/​index.htm . Select the “Send comments via e-mail” link under this notice number.                 
    -  Federal e-Rulemaking Portal:                      To submit comments to us via the Federal e-rulemaking portal, visit                      http://www.regulations.gov                      and follow the instructions for submitting comments.                 

You may also write to the Administrator before the comment closing date to ask for a public hearing. The Administrator reserves the right to determine, in light of all circumstances, whether to hold a public hearing. 

### Public Disclosure 

You may view copies of this notice, the petition, the appropriate maps, and any comments we receive by appointment at the TTB Library at 1310 G Street, NW., Washington, DC 20220. You may also obtain copies at 20 cents per 8.5 x 11-inch page. Contact our librarian at the above address or telephone 202-927-2400 to schedule an appointment or to request copies of comments. 

                    For your convenience, we will post this notice and any comments we receive on the TTB Web site. We may omit voluminous attachments or material that we consider unsuitable for posting. In all cases, the full comment will be available in the TTB Library. To access the online copy of this notice, visit                     *http://www.ttb.gov/​alcohol/​rules/​index.htm*. Select the “View Comments” link under this notice number to view the posted comments.                 

## Regulatory Flexibility Act 

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

## Executive Order 12866

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

## Drafting Information 

Jennifer Berry of the Regulations and Procedures Division drafted this notice. 

# List of Subjects in 27 CFR Part 9

      - Wine

## Proposed Regulatory Amendment 

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

# PART 9—AMERICAN VITICULTURAL AREAS 

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

Authority:27 U.S.C. 205. 

2. Amend subpart C by adding § 9.___ to read as follows: 

      ( print page 69561)    

# Subpart C—Approved American Viticultural Areas 

## § 9.___  Texoma. 

                        (a)                         *Name.*                         The name of the viticultural area described in this section is “Texoma”. For purposes of part 4 of this chapter, “Texoma” is a term of viticultural significance.                     

                        (b)                         *Approved maps.*                         The two USGS, 1:250,000 scale, topographic maps used to determine the boundaries of the Texoma viticultural area are titled—                    

(1) Sherman, Texas; Oklahoma, 1954, revised 1977; and 

(2) Texarkana, Tex.; Ark.; Okla.; La., 1953, revised 1972. 

                        (c)                         *Boundary.*                         The Texoma viticultural area is located in Montague, Cooke, Grayson, and Fannin counties, Texas. The area's boundaries are defined as follows—                    

(1) The point of beginning is the northwest corner of Montague County on the Sherman map. From this point, the boundary line—

(2) Follows the Red River eastward along the Texas-Oklahoma State line to the northeast corner of Fannin County on the Texarkana map; 

(3) Continues southward along the eastern Fannin County line to a point, approximately three miles west of Petty, Texas, where a power line crosses the county line; 

(4) Continues southwest in a straight line for approximately 13 miles to the intersection of State Routes 34 and 50 in Ladonia, Texas; 

(5) Follows State Route 34 west to its intersection with State Route 68 on the Sherman map; 

(6) From that intersection, continues west-southwesterly in a straight line to the intersection of U.S. Highway 69 and State Route 78 at Leonard, Texas; 

(7) Continues northwest on U.S. Highway 69 for approximately 6 miles to its intersection with State Route 121 at Trenton, Texas; 

(8) From that intersection, continues westerly in a straight line to the intersection of State Routes 160 and 121, and continues west on State Route 121 to its intersection with U.S. Highway 75 at Van Alstyne, Texas; 

(9) Continues south along U.S. Highway 75 to the Grayson County line; 

(10) Continues west along the southern Grayson County line and then the southern Cooke County line to the line's intersection with Interstate 35; 

(11) Continues north along Interstate 35 to its intersection with State Route 922 at Valley View, Texas; 

(12) Follows State Route 922 west for approximately 17 miles to Rosston, Texas; 

(13) Continues west-southwest from Rosston in a straight line for approximately 19 miles to the intersection of U.S. Highway 287 and State Route 101 at Sunset, Texas; 

(14) Follows U.S. 287 northwest approximately 17 miles to the western Montague County line; and 

(15) Continues north along the western Montague County line to the starting point at the northwest corner of Montague County. 

Signed: November 10, 2004. 

Arthur J. Libertucci, 

Administrator. 

[FR Doc. 04-26329 Filed 11-29-04; 8:45 am] 

BILLING CODE 4810-31-P