[Federal Register Volume 70, Number 234 (Wednesday, December 7, 2005)]
[Rules and Regulations]
[Pages 72713-72717]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-23683]


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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[T.D. TTB-38; Re: Notice No. 25]
RIN 1513-AA77


Establishment of the Texoma Viticultural Area (2003R-110P)

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

ACTION: Final rule; Treasury decision.

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SUMMARY: This Treasury decision establishes the Texoma viticultural 
area in north-central Texas, in Montague, Cooke, Grayson, and Fannin 
Counties. The proposed area covers approximately 3,650 square miles on 
the south side of Lake Texoma and the Red River, along the Texas-
Oklahoma Stateline. 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.

EFFECTIVE DATE: January 6, 2006.

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

SUPPLEMENTARY INFORMATION:

[[Page 72714]]

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--
    <bullet> Evidence that the proposed viticultural area is locally 
and/or nationally known by the name specified in the petition;
    <bullet> Historical or current evidence that supports setting the 
boundary of the proposed viticultural area as the petition specifies;
    <bullet> Evidence relating to the geographical features, such as 
climate, soils, elevation, and physical features, that distinguish the 
proposed viticultural area from surrounding areas;
    <bullet> A description of the specific boundary of the proposed 
viticultural area, based on features found on United States Geological 
Survey (USGS) maps; and
    <bullet> A copy of the appropriate USGS map(s) with the proposed 
viticultural area's boundary prominently marked.

Texoma Petition and Rulemaking

General Background

    The Texoma Appellation Committee, in Denison, Texas, petitioned TTB 
to establish the ``Texoma'' viticultural area in north-central Texas. 
Located along the Texas-Oklahoma Stateline on the south side of Lake 
Texoma and the Red River, the proposed area covers approximately 3,650 
square miles, or about 2.3 million acres, in Montague, Cooke, Grayson, 
and Fannin Counties. The proposed viticultural area contains four 
wineries and a number of small vineyards with approximately 55 acres 
planted to vines. Both native Texas grape varieties and Vitis vinifera 
varieties thrive in the proposed area.
    Below, we summarize the evidence presented in the petition.

Name Evidence

    The name ``Texoma'' originates with Lake Texoma, a large man-made 
lake on the Texas-Oklahoma Stateline. People have referred to the 
region within the proposed viticultural area as ``Texoma'' for over 60 
years, roughly since the completion of Lake Texoma in 1938. The 
petition provided numerous examples of the use of the name ``Texoma'' 
by businesses and governments serving the four-county (Montague, Cooke, 
Grayson, and Fannin) region, including the Texoma Regional Health Care 
System, the Texoma Association of Realtors, and the Texoma Council of 
Governments.
    In addition, an Internet search of the word ``Texoma'' returned 
several thousand website listings, with references to Montague, Cooke, 
Grayson, and Fannin Counties in Texas, as well as the region of south-
central Oklahoma bordering Lake Texoma.

Boundary Evidence

    The proposed Texoma viticultural area boundary line corresponds to 
the Texoma region of north-central Texas. The Red River, Lake Texoma, 
and the Texas-Oklahoma Stateline form the proposed area's northern 
boundary. The ridge between the Red River drainage basin and the 
Trinity River drainage basin forms the southern boundary of the 
proposed area. The Montague County line forms most of the proposed 
area's western boundary, while the Fannin County line forms most of its 
eastern boundary.
    Historical evidence in the petition for the proposed boundaries 
includes the contributions of the Texoma region to world viticulture. 
Renowned 19th century viticulturalist Thomas Volney (T.V.) Munson chose 
the Texoma area as the site for his experimental vineyards. An expert 
on native grape varieties, it was reported that he was particularly 
excited by the varieties of native grapes found within the region, 
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. 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 an associate degree in viticulture.
    Because of the importance of native grape species to the 
viticultural history and identity of the Texoma region, the petitioner 
bases the southern boundary in part on the distribution of wild 
grapevines through the area. The proposed Texoma viticultural area 
southern boundary excludes some southern portions of the four counties 
since wild grapevines generally do not grow on the south-facing slopes 
beyond the ridge that divides the Red River and Trinity River drainage 
basins.

Distinguishing Features

Topography
    Much of the terrain in the Texoma region 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 off the Texoma 
bluffs and rolling hillsides temper the intense heat of the day, and 
cool the vineyards. Numerous small creeks flow northward to Lake Texoma 
and the Red River throughout the Texoma area. Several varieties of wild 
grapes grow freely in these creek beds, just as they did in the days of 
T.V. Munson.
    The north-facing slopes (3 percent to 12 percent incline) in the 
proposed Texoma viticultural area diminish the power of the summer sun 
and thus provide excellent conditions for vineyards. Recent research 
indicates that 15-degree north-facing slopes can reduce the sunlight 
index in June from 107 to 86. (The sunlight index is a scale

[[Page 72715]]

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 petitioner contrasts the sunlight index with land south of the 
proposed Texoma viticultural area. For example, in the Dallas-Fort 
Worth area, the land slopes south, resulting in a much higher sunlight 
index and greater heat stress on grape vines.
    The Texoma area has numerous lakes and ponds, including Lake 
Texoma, all of which provide ample irrigation sources. The numerous 
bodies of water also provide sunlight reflection, which helps to ripen 
grapes. A similar reflective effect occurs in the Finger Lakes region 
of New York and in the Mosel and Rhine River valleys of Germany. 
Additionally, gentle breezes off Lake Texoma provide advection warming 
to the surrounding hillsides during cool autumn nights.
Climate
    Nighttime temperatures in the proposed Texoma viticultural area 
from 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 [deg]F) and Greenville, Texas (which 
averages 34.9 [deg]F). The nighttime winter temperatures in the Texoma 
region, ranging in the mid- to upper-20s, are cold enough to kill the 
insect that spreads the toxic Pierce's disease, but are not cold enough 
to cause damage to the vines. Vineyards to the south with warmer winter 
temperatures, specifically in the Dallas-Fort Worth area, typically 
suffer extensive damage from Pierce's disease.
    Areas north and west of the Texoma area, including Oklahoma and 
northwestern Texas, have winter temperatures that are 4 to 6 degrees 
colder than in the proposed Texoma viticultural area. Colder 
temperatures increase the risk of damage to vines. Freeze and thaw 
cycles in these areas can split vine trunks, while the milder winter 
temperatures in the Texoma area prevent such damage.
    The Texoma region receives an annual rainfall of 30 to 40 inches, 
which is sufficient when coupled with the ample sources of irrigation 
in the region. To the west of the Texoma region, the climate is 
increasingly dry. 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 the 
Texoma region. Areas east of the Texoma region 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.
Soils
    The soils found in the proposed Texoma viticultural area differ 
from the soils in surrounding areas. The proposed Texoma area contains 
sandy, loamy soils that provide good drainage for vineyards. 
Conversely, the surrounding areas outside the proposed Texoma 
viticultural area boundary line contain black-land soils, which do not 
provide good drainage for vineyards. The sandy soils found in the 
proposed viticultural area are also a natural deterrent to phylloxera.
    The petitioner submitted a detailed soil report on the proposed 
Texoma viticultural area prepared by a committee of soil scientists 
consisting of Maurice Jurena and Jerry Rives from the Natural Resources 
Conservation Service of the U.S. Department of Agriculture, 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 and refers to maps that show these soil series 
throughout the Texoma area. According to the soil report 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 region, the soil 
report authors specify that about one-third of the proposed 
viticultural 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 petitioner 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 
the proposed Texoma viticultural area, including those detailed in the 
soil report submitted with the petition as either ``loamy and sandy'' 
or ``loamy and clayey.''

Boundary Description

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

Maps

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

Notice of Proposed Rulemaking and Comments Received

    On November 30, 2004, TTB published in the Federal Register (69 FR 
69557) a notice of proposed rulemaking regarding the establishment of 
the Texoma viticultural area as (Notice No. 25). In that notice, TTB 
requested comments by January 31, 2005, from all interested persons. 
TTB received three comments in response.
    A Montague County vineyard owner opposed the petition on several 
grounds. Regarding the petition's name and boundary evidence, the 
commenter states that his region of Montague County, which is within 
the proposed viticultural area, is not known by the Texoma name. He 
also notes that T.V. Munson chose ``the Denison area to do his 
research, not Texoma,'' a name which ``did not exist until 1938.'' 
While acknowledging that a north Texas radio station does identify its 
listening area as ``Texoma Land,'' the commenter states that this name 
usage is not adequate justification to propose a viticultural area. In 
addition, the commenter notes the dual Texas/Oklahoma nature of the 
Texoma name and contends that Oklahoma vineyards ``would not want to be 
confused with Texas vineyards.''
    The commenter also states that Montague County has two soil types 
suitable for viticulture, including the Antlers Sands, which, he 
states, ``do not exist in Fannin or Grayson Counties.'' The comment 
also contends that the climate and elevation of the proposed area are 
``simply too diverse'' to be included within one viticultural area.
    In response to the opposing comment regarding name and boundary 
evidence,

[[Page 72716]]

a petitioner submitted a rebuttal providing additional information to 
demonstrate the use of the ``Texoma'' name in Montague County. The 
petitioner also expressed concern over the accuracy of the opposing 
comment's soil and climatic information, calling the opposing comment a 
matter of personal opinion that lacked substantiating facts.
    TTB has carefully evaluated these two comments with reference to 
the submitted supporting information. Regarding the proposed name and 
boundary evidence, the opposing comment provided no specific evidence 
to show that Montague County is not part of the generally recognized 
``Texoma'' area. We believe the petitioner's evidence supports the use 
of the Texoma name in the portion of Montague County that lies within 
the proposed viticultural area.
    In response to the comment regarding T.V. Munson, we note that the 
purpose of presenting the grape-growing history of a proposed 
viticultural area is to document previous grape growing in the area. 
Reference to the innovative individuals responsible for the early 
plantings in the area is of some historical viticultural interest, but 
grape-growing history is not an absolute requirement for the 
establishment of an American viticultural area. In response to the 
commenter's statements on the subject of Oklahoma vineyards, we note 
that we did not receive any comments from Oklahoma vineyard industry 
members regarding the proposed Texoma viticultural area.
    We also note that the Montague County soil, elevation, and climate 
information offered in the opposing comment generally conforms to the 
overall petition evidence, except for the lower annual precipitation 
rate in Montague County. TTB believes that the variances referred to by 
the commenter are minor differences that should not affect the decision 
on whether to establish the proposed viticultural area. With regard to 
comments on soils that were submitted, we note that while soil 
characteristics are an important factor in assessing a proposed 
viticultural area, it would be overly restrictive and thus 
inappropriate to require uniformity of soil types throughout a proposed 
viticultural area.
    The third comment expresses concern over a possible name conflict 
between the proposed Texoma viticultural area and the commenter's 
planned ``Texoma Vineyards'' and ``Texoma Winery.'' The commenter 
supports the viticultural area's establishment as long as his future 
business is allowed to use the Texoma Vineyard or Texoma Winery names 
``in the name and address area of the label'' regardless of the wine's 
origin.
    With regard to this third comment, TTB does not believe that the 
commenter's future winery operations should have any bearing on the 
establishment of the proposed Texoma viticultural area. We make our 
decision based on the facts presented to us, not based on hypothetical 
future events. It was for this purpose that, in the comment 
notification of Notice No. 25, we specifically invited comments on the 
impact that the proposed viticultural area might have on an existing 
(not future) viticultural enterprise. According to the information 
provided by the commenter, he has not commenced winery operations and 
has not filed for label approvals using the ``Texoma Vineyard'' or 
``Texoma Winery'' brand names. In the future, should the commenter wish 
to bottle and label wine using those names, he must ensure that the 
wine meets the appellation of origin requirements set forth in 27 CFR 
part 4 and summarized in the Impact on Current Wine Labels discussion 
below.

TTB Finding

    After careful review of the petition and the comments received, TTB 
finds that the evidence submitted supports the establishment of the 
proposed viticultural area. Therefore, under the authority of the 
Federal Alcohol Administration Act and part 4 of our regulations, we 
establish the ``Texoma'' viticultural area in north-central Texas in 
Montague, Cooke, Grayson, and Fannin Counties, effective 30 days from 
publication of this document.

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, ``Texoma,'' 
is 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, must 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 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, 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 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.
    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 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

    Nancy Sutton of the Regulations and Rulings Division drafted this 
document.

List of Subjects in 27 CFR Part 9

    Wine.

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. Amend subpart C by adding Sec.  9.185 to read as follows:


Sec.  9.185  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.

[[Page 72717]]

    (b) Approved Maps. The appropriate maps for determining the 
boundaries of the Texoma viticultural area are two United States 
Geological Survey, 1:250,000 scale, topographic maps. They 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 boundary is defined as 
follows:
    (1) The beginning point is the northwest corner of Montague County 
(at the Red River, which is also the Texas-Oklahoma State line) on the 
Sherman map. From this point, the boundary line:
    (2) Follows the Red River eastward along the Texas-Oklahoma State 
line, passes onto the Texarkana map, and continues to the northeast 
corner of Fannin County; then
    (3) Continues southward along the eastern Fannin County line to a 
point approximately three miles west of Petty, Texas, where a power 
line shown on the Texarkana map crosses the county line; then
    (4) Continues southwest in a straight line for approximately 13 
miles to the intersection of State Routes 34/50 and State Route 64 at 
Ladonia, Texas; then
    (5) Follows State Route 34 west to its intersection with State 
Route 68; then
    (6) Continues west-southwesterly in a straight line from that 
intersection to the intersection of U.S. Highway 69 and State Route 78 
at Leonard, Texas, on the Sherman map; then
    (7) Continues northwest on U.S. Highway 69 for approximately 6 
miles to the intersection of U.S. Highway 69 and State Route 121 at 
Trenton, Texas; then
    (8) Continues westerly in a straight line to the intersection of 
State Routes 160 and 121, and then continues west on State Route 121 to 
its intersection with U.S. Highway 75 at Van Alstyne, Texas; then
    (9) Continues south along U.S. Highway 75 to the Grayson County 
line; then
    (10) Continues west along the southern Grayson County line and then 
the southern Cooke County line to the county line's intersection with 
Interstate 35; then
    (11) Continues north along Interstate 35 to its intersection with 
State Route 922 in Valley View, Texas; then
    (12) Follows State Route 922 west for approximately 17 miles to 
Rosston, Texas; then
    (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; then
    (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 
beginning point at the northwest corner of Montague County.

    Signed: September 28, 2005.
John J. Manfreda,
Administrator.
    Approved: November 3, 2005.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).
[FR Doc. 05-23683 Filed 12-6-05; 8:45 am]
BILLING CODE 4810-31-P