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###### Department of the Treasury

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

          - 27 CFR Part 9 
          - [T.D. TTB-60; Re: Notice No. 58] 
          - RIN: 1513-AB18 

# AGENCY:

Alcohol and Tobacco Tax and Trade Bureau, Treasury. 

# ACTION:

Final rule; Treasury decision. 

# SUMMARY:

This Treasury decision renames the “Sonoma County Green Valley” viticultural area in northern California as the “Green Valley of Russian River Valley” viticultural area. This decision does not affect the location, size, or boundary of the viticultural area. 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:*                         This final rule is effective on April 23, 2007. Wine bottlers may continue to use approved labels bearing the former viticultural area name until April 23, 2009.                     

# FOR FURTHER INFORMATION CONTACT:

N. A. Sutton, Regulations and Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 925 Lakeville St., No. 158, Petaluma, California 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. 

### 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. Petitioners may use the same procedure to request changes involving existing viticultural areas. 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.

                    A petition requesting a change to an established viticultural area must include the appropriate evidence described above to support the requested change.                           ( print page 13691)    

## Sonoma County Green Valley Viticultural Area Background 

                    TTB's predecessor agency, the Bureau of Alcohol, Tobacco and Firearms (ATF), established the Sonoma County Green Valley viticultural area (27 CFR 9.57) in a Treasury Decision (T.D. ATF-161), published in the                     **Federal Register**                     at 48 FR 52577 on November 21, 1983. The 19,010-acre Sonoma County Green Valley viticultural area is located north of San Francisco in southern Sonoma County. The Sonoma County Green Valley viticultural area lies between the towns of Sebastopol, Forestville, and Occidental within the Russian River Valley viticultural area (27 CFR 9.66), which, in turn, lies entirely within the Sonoma Coast viticultural area (27 CFR 9.116) and the multi-county North Coast viticultural area (27 CFR 9.30).                 

(T.D. ATF-161 mistakenly stated the size of the Sonoma County Green Valley viticultural area as 32,000 acres. When this viticultural area was originally established in 1983, its total acreage was miscalculated since its boundaries did not coincide with the 640-acre sections marked on the USGS quadrangle maps, which made determining its size difficult. Since 1983, new digital technology has been developed that allows for more accurate calculations even when boundaries do not align with the section lines on USGS maps. Such technology was used to map this viticultural area and to determine its correct size—19,010 acres.) 

In 1982, the original petitioner sought to use the name “Green Valley” for this viticultural area. However, while ATF determined that the Green Valley name was appropriate for the area, ATF required the addition of “Sonoma County” to the name, and thus approved the name “Sonoma County Green Valley” as the viticultural area name. ATF took this action to avoid consumer confusion since “Green Valley” is a commonly used geographic place name in the United States. 

In approving the Sonoma County Green Valley viticultural area, ATF specifically noted its 1982 approval of the “Solano County Green Valley” viticultural area (27 CFR 9.44) with the same condition—that the county name appear in conjunction with the name proposed for the viticultural area to prevent consumer confusion with other “Green” valleys located elsewhere in the United States. The subsequent T.D. ATF-161, establishing the Sonoma County Green Valley viticultural area, stated that since both “Green Valley” viticultural areas are located in northern California, the inclusion of the county name modifier in each viticultural area name helped to avoid consumer confusion by distinguishing between the two viticultural areas. 

## Green Valley of Russian River Valley Petition 

The Winegrowers and Vintners of Sonoma County's Green Valley, an association of local winegrowers and vintners based in Sebastopol, California, petitioned TTB to change the name of the “Sonoma County Green Valley” viticultural area to “Green Valley of Russian River Valley.” The group explained in its petition that the name change is warranted because the viticultural area is commonly referred to as “Green Valley,” without the Sonoma County modifier. Also, the Green Valley area is considered by many to be a sub-appellation of the Russian River Valley viticultural area by virtue of its location and similar climate. 

                    TTB notes that the recently expanded 126,600-acre Russian River Valley viticultural area now encompasses the entire Sonoma County Green Valley viticultural area. (See T.D. TTB-32, published in the                     **Federal Register**                     at 70 FR 53297 on September 8, 2005.) We also note that the proposed name change does not affect the established boundaries of either viticultural area.                 

Three wineries located within the Sonoma County Green Valley viticultural area boundary line, according to the petition, consistently claim the “Sonoma County Green Valley” appellation on their wine labels. Other regional wineries use the Russian River Valley viticultural area name as an appellation of origin on their labels, the petition continues, but include references to the Sonoma County Green Valley viticultural area on their wines' back labels and in their promotional materials. 

Changing the viticultural area name to “Green Valley of Russian River Valley,” the petition explains, would provide greater clarity regarding the viticultural area's location and its association with the cool climate of the Russian River Valley. Thus, the petition continues, consumers would have more accurate and descriptive geographical and climatic information for the wines of the viticultural area. 

### Name Evidence 

The petition provides evidence, summarized below, to document that the Sonoma County Green Valley viticultural area is known, and referred to, simply as “Green Valley.” Also, the same evidence describes “Green Valley” as being a part of the larger Russian River Valley viticultural area. 

The Savor Wine Country magazine (winter 2003, page 78), published by the Press Democrat newspaper of Sonoma County, California, included a feature article on “Green Valley.” A map of the “Green Valley” area and the Russian River Valley area, provided with the article, is generally consistent with the boundaries of both viticultural areas, including the (at that time) proposed boundary expansion of the Russian River Valley viticultural area. The article states that “Green Valley” is a sub-appellation of the sprawling Russian River Valley viticultural area. It also describes the abundant sparkling wine production, pinot noir grapes, and other agricultural products produced in the “Green Valley” area. The article characterizes the viticultural area as a diverse farming region with cool coastal breezes, coinciding with the climatic conditions found in the Russian River Valley viticultural area. 

A Los Angeles Times article of January 14, 2004, titled “Out of the Mist, Pinots,” describes the Russian River Valley viticultural area and its “sub-regions” as having distinct wine personalities. The article states: “Russian River Valley AVA and the Green Valley AVA are primarily climate-based appellations.” While expounding on the exceptional soils of the Russian River Valley viticultural area, the article also states: “The Green Valley AVA (a part of the Russian River AVA) yields bright, bold Pinots with crystalline fruit and piercing acidity.” 

A recent “Sonoma County Wine Country Guide,” published by the Sonoma County Wineries Association and included with the petition, describes the “Green Valley” area on page 24 as a small sub-appellation of the Russian River Valley viticultural area. The article also describes Green Valley's marine-influenced climate and the Goldridge series soils, which are conducive to growing fruit. Also, the publication on page 18 contains an untitled map of Sonoma County's rural western expanse that identifies the Sonoma County Green Valley viticultural area simply as “Green Valley.” 

### Linkage of Two Viticultural Area Names 

                    By linking the name of the Green Valley viticultural area to the larger Russian River Valley viticultural area that surrounds it, the petitioners seek to prevent consumer confusion between the two established “Green Valley” viticultural areas of northern California, as well as between the Green Valley in Sonoma County and other “Green” valleys in the United States. TTB believes that adoption of the proposed                           ( print page 13692)                        new “Green Valley of Russian River Valley” name would be permissible so long as it accurately reflects the geographical location of the viticultural area and does not otherwise create confusion for the consumer.                 

                    In addition, we note that we have previously approved a viticultural area name that includes the name of a surrounding viticultural area within it in order to prevent consumer confusion. In that case, a petitioner proposed to establish the Oak Knoll District viticultural area within the larger Napa Valley viticultural area (27 CFR 9.23) in Napa County, California. In order to distinguish the proposed Oak Knoll District viticultural area from the established Oak Knoll Winery located in Oregon, TTB approved the addition of the “Napa Valley” name to the area's name, resulting in the establishment of the “Oak Knoll District of Napa Valley” viticultural area (27 CFR 9.161). (See T.D. TTB-9, published in the                     **Federal Register**                     at 69 FR 8562 on February 25, 2004.)                 

### Notice of Proposed Rulemaking 

                    On May 2, 2006, TTB published in the                     **Federal Register**                     (71 FR 25795) Notice No. 58 regarding the proposed Sonoma County Green Valley viticultural area name change. We received no comments in response to that notice.                 

## TTB Finding 

After careful review of the petition, TTB finds that the evidence submitted supports changing the name of the “Sonoma County Green Valley” viticultural area to “Green Valley of Russian River Valley,” as requested in the petition. Therefore, under the authority of the Federal Alcohol Administration Act and part 4 of our regulations, we amend our regulations to re-name the Sonoma County Green Valley viticultural area as the Green Valley of Russian River Valley viticultural area effective 30 days from the publication date of this document. 

## Impact on Current Wine Labels 

### General 

                    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 approval of this viticultural area name change, the new name, “Green Valley of Russian River Valley,” will be recognized under 27 CFR 4.39(i)(3) as a name of viticultural significance. The text of the new regulation clarifies this point. This name change will affect vintners who currently and properly use the “Sonoma County Green Valley” viticultural area name, as explained in the                     *Transition Period*                     discussion below.                 

                    We also remain of the view that it would not be appropriate to treat “Green Valley” standing alone as a term of viticultural significance due to its widespread use across the United States as a geographic place name. For example, a recent search of the USGS Geographic Names Information System (                    *http://geonames.usgs.gov/​*) found 65 entries for “Green Valley” in 23 States, including at least 13 places in California in 11 different counties.                 

Therefore, the part 9 regulatory text as amended in this document specifies that only the full “Green Valley of Russian River Valley” name is a term of viticultural significance for purposes of part 4 of the TTB regulations. Consequently, wine bottlers using the entire name, “Green Valley of Russian River Valley,” 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 labeled with a viticultural area name or with a brand name that includes a viticultural area name or other term identified as 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 viticulturally significant term and that name or other 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 or other viticulturally significant term that was used as a brand name on a label approved before July 7, 1986. See 27 CFR 4.39(i)(2) for details. 

### Transition Period 

Holders of labels approved before the effective date of this final rule that use the “Sonoma County Green Valley” name to designate a viticultural area will be permitted to continue using those approved labels during the two year transition period. At the end of that two-year period, holders of “Sonoma County Green Valley” wine labels must discontinue use of those labels and will need to secure approval of new labels reflecting the correct use of the new viticultural area name as an appellation of origin. We believe the two year period will provide such label holders with adequate time to use up their old labels. In addition, “Sonoma County Green Valley” will remain a term of viticultural significance for two years from the effective date of this final rule. 

## 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 requirement. 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 

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

# List of Subjects in 27 CFR Part 9

      - Wine

## The Regulatory Amendment 

For the reasons discussed in the preamble, we amend 27 CFR, chapter I, part 9, 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. 

# Subpart C—Approved American Viticultural Areas 

2. In § 9.57, the section heading, paragraph (a), the introductory text of paragraph (b), and the introductory text of paragraph (c) are revised and a new paragraph (d) is added to read as follows: 

§ 9.57 

                            (a)                             *Name.*                             The name of the viticultural area described in this section is “Green Valley of Russian River Valley”. For purposes of part 4 of this chapter, “Green Valley of Russian River Valley” is a term of viticultural significance. “Sonoma County Green Valley” is also                                   ( print page 13693)                                a term of viticultural significance until April 23, 2009.                         

                            (b)                             *Approved maps.*                             The appropriate maps for determining the boundary of the Green Valley of Russian River Valley viticultural area are three United States Geological Survey maps. They are titled:                         

* * * * *

                            (c)                             *Boundary.*                             The Green Valley of Russian River Valley viticultural area is located in Sonoma County, California. The beginning point is located in the northeastern portion of the “Camp Meeker Quadrangle” map where the line separating Section 31 from Section 32, in Township 8 North (T.8N.), Range 9 West (R.9W.) intersects River Road.                         

* * * * *

(d) From December 21, 1983, until April 23, 2007, the name of this viticultural area was “Sonoma County Green Valley”. Effective April 23, 2007, this viticulture area is named “Green Valley of Russian River Valley”. Existing certificates of label approval showing “Sonoma County Green Valley” as the appellation of origin will be revoked by operation of this regulation on April 23, 2009.

Signed: January 3, 2007. 

John J. Manfreda, 

Administrator. 

Approved: February 1, 2007. 

Timothy E. Skud,

Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).

[FR Doc. E7-5413 Filed 3-22-07; 8:45 am] 

BILLING CODE 4810-31-P