[Federal Register: July 17, 2006 (Volume 71, Number 136)]
[Rules and Regulations]               
[Page 40397-40400]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17jy06-7]                         

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DEPARTMENT OF THE TREASURY

Alcohol and Tobacco Tax and Trade Bureau

27 CFR Part 9

[T.D. TTB-52; Re: Notice No. 55]
RIN 1513-AB15

 
Establishment of the Saddle Rock-Malibu 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 2,090-acre Saddle Rock-
Malibu viticultural area in Los Angeles County, California. 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: N.A. Sutton, Regulations and Rulings 
Division, Alcohol and Tobacco Tax and Trade Bureau, 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.

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 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.

Saddle Rock-Malibu Viticultural Area Petition and Rulemaking

Background

    Lisa A. Semler and Derek Baugh of Semler Malibu Estate Vineyards in 
Malibu, California, submitted a petition to establish the Saddle Rock-
Malibu viticultural area. Located in western Los Angeles County, 
California, the proposed viticultural area covers approximately 2,090 
acres in the Santa Monica Mountains, approximately 32 miles west of 
downtown Los Angeles and 5 miles inland from the Pacific Ocean. The 
proposed area lies between 1,700 and 2,236 feet in elevation and has 70 
acres of vineyards located between 1,800 and 2,000 feet in elevation.
    The primary distinguishing viticultural features of the proposed 
Saddle Rock-Malibu viticultural area include its high elevation and 
location, as well as its orientation within the Santa Monica Mountains, 
which limits its exposure to the cooling Pacific marine inversion 
layer, according to the petition. As a result, the proposed area 
receives more solar radiation and is warmer than neighboring areas with 
more marine influence during the growing season.
    The information submitted in support of the petition is summarized 
below.

Name Evidence

    The name of the proposed Saddle Rock-Malibu viticultural area 
combines the name of a high, prominent rock formation within the 
proposed area, Saddle Rock, with the name of the surrounding region of 
western Los Angeles County, Malibu. According to the petition, the 
``Saddle Rock-Malibu'' name provides an accurate geographical 
description of the proposed viticultural area.
    Located in the Santa Monica Mountains near the center of the 
proposed area, Saddle Rock is a prominent saddle-shaped rock formation 
that rises 2,000 feet above sea level. Saddle Rock is identified on the 
USGS Point Dume, California, quadrangle map in section 12, T1S/R19W. 
Saddle Rock Ranch is located within the proposed viticultural area, and 
the Saddle Rock Pictograph Site, located on the ranch between Saddle 
Rock and Mitten Rock, is a National Historic Landmark. The pictographs 
found at the Saddle Rock site are characteristic of the Chumash Indian 
art style, according to the National Park Service's National Historic 
Landmark Web site, which also notes that Saddle and Mitten Rocks served 
as landmarks for prehistoric and early historic travelers (see http://www.cr.nps.gov/nhl/DOE_dedesignations/saddlerock.htm
).

    The Malibu region, which the petition describes as encompassing 
western Los Angeles County from the ridge line of the Santa Monica 
Mountains in the north to the Pacific Ocean in the south

[[Page 40398]]

and from Topanga Canyon in the east to the Ventura County line in the 
west, surrounds the Saddle Rock area. The Malibu region is shown on the 
July 2001 American Automobile Association map titled, ``Coast & Valley 
Bay Area to Southern California,'' in section G-12. The USGS Geographic 
Names Information System lists 30 Malibu name uses within Los Angeles 
County, including streams, beaches, lakes, a reservoir, parks, towns, 
buildings, and an airport.
    TTB's predecessor agency, the Bureau of Alcohol, Tobacco and 
Firearms (ATF), established the Malibu-Newton Canyon viticultural area 
(27 CFR 9.152) in T.D. ATF-375, published in the Federal Register (61 
FR 29952) on June 13, 1996. The preamble of T.D. ATF-375 explained that 
the ``Malibu'' name originated with the Chumash Indians as ``Mala I 
Boo,'' meaning ``place of cliffs.'' The 1805 Topanga Malibu Sequit land 
grant of 13,315 acres, also referred to as Rancho Malibu, includes the 
modern day ``Malibu'' spelling. In the 1930s, with the construction of 
the Pacific Coast Highway, the petition states that the Malibu region 
developed into the nationally known community it is today.

Boundary Evidence

    The modern history of the proposed Saddle Rock-Malibu viticultural 
area dates to the era of Spanish colonial land grants, and the proposed 
area lies between the historic Topanga Malibu Sequit land grant to the 
south and the El Conejo land grant to the north. Originally known as 
``El Malibu,'' the petition states that the ranch surrounding the 
Saddle Rock formation was, by the 1930s, known as Saddle Rock Ranch. 
Wine grape production within the proposed Saddle Rock-Malibu 
viticultural area began in 1997, according to the petition, and as of 
February 2005 the area had 70 vineyard acres in commercial production.
    Roughly centered on the Saddle Rock formation, the proposed Saddle 
Rock-Malibu viticultural area encompasses a suspended valley within the 
higher elevations of the Santa Monica Mountains. Beginning at Decker 
Road, the northern boundary of the proposed area follows a portion of 
the southern boundary of the El Conejo land grant, and then follows the 
1,700-foot contour line southeasterly to Mulholland Highway. Steep 
mountain terrain lies to the east and south of the proposed Saddle 
Rock-Malibu area, while the Malibu Country Club lies to its west. The 
petition uses trails, unimproved roads, and secondary roads to 
delineate the eastern, southern, and western portions of the proposed 
boundary, according to the written boundary description and USGS Point 
Dume map provided with the petition.

Distinguishing Features

    The proposed Saddle Rock-Malibu viticultural area's high 
elevations, north-facing slope orientation, and geographical location 
in the Santa Monica Mountains all combine to create a microclimate with 
limited marine influence, according to the petition. As compared to 
surrounding areas with more marine influence, the proposed area 
receives more growing season sunshine and has warmer temperatures. The 
proposed area's microclimate, the petition continues, creates a 
distinctive and unique mountainous grape-growing region.
Topography
    The proposed Saddle Rock-Malibu viticultural area, according to the 
petition, is a geographically suspended valley located largely on the 
leeward side of the crest of the Santa Monica Mountains. From the 
mountains' crest, elevations drop about 2,000 feet to the Pacific Ocean 
in the south and, in the north, about 1,000 feet to the Conejo Valley 
floor. Within the proposed viticultural area, elevations range from a 
low of 1,700 feet along much of the boundary line to a 2,236-foot peak 
along its northeast border, as shown on the Point Dume map. 
Intermittent streams flow from the higher elevations downward toward 
the Pacific Ocean or toward larger streams in the Conejo Valley to the 
north. Several secondary highways, light-duty roads, and a number of 
unimproved roads and jeep trails criss-cross the proposed Saddle Rock 
area, as shown on the Point Dume USGS map.
Climate
    The unique microclimate of the proposed Saddle Rock-Malibu 
viticultural area is its most distinguishing viticultural feature, 
according to the petition, which included a climate report prepared by 
Fox Weather of Fortuna, California. While the larger Malibu regional 
climate is typical of southern California with mild, rainy winters and 
warm, dry summers, the petition states that the proposed Saddle Rock-
Malibu viticultural area is climatically affected by its geographical 
location in the Santa Monica Mountains.
    The Pacific Ocean, about 5 miles south of the proposed viticultural 
area, provides an intrusive marine influence that permeates the Santa 
Monica Mountains area incrementally, based on elevation, time of year, 
and other factors, according to Fox Weather. In this region of Los 
Angeles County, this cool, moist, marine influence funnels northward 
from the ocean, through the low gaps in the mountain range, reaching 
various elevations at different times in the growing season. The 
proposed Saddle Rock-Malibu viticultural area's high elevations, its 
location on the leeward side of the mountains' crest, and its north-
facing mountain slopes are significant factors in limiting the extent 
of the cooling marine influence received within the proposed area, 
according to the submitted Fox Weather data.
    Summers in the Malibu region are hot and dry at the higher 
elevations above the marine influence and are cooler and less sunny in 
the lower coastal areas and beaches, according to Fox Weather. A 
comparison of growing season heat accumulation as measured by degree-
days shows that the proposed Saddle Rock-Malibu viticultural area, at 
4,200 degree-days, is somewhat warmer than the nearby Malibu-Newton 
Canyon viticultural area, which accumulates 4,000 to 4,100 degree days 
during the growing season. (Degree-days represent a measurement of heat 
accumulation during the growing season, with one degree-day 
accumulating for each degree that a day's mean temperature is above 50 
degrees Fahrenheit, which is the minimum temperature required for 
grapevine growth. See ``General Viticulture,'' by Albert J. Winkler, 
University of California Press, 1975.) Further inland, toward the San 
Fernando Valley, temperatures are warmer during the day and cooler at 
night than along the crest of the Santa Monica Mountains.
    The temperature and growing condition differences between the 
proposed Saddle Rock-Malibu viticultural area and the established 
Malibu-Newton Canyon viticultural area result from the prevailing wind 
flows of summer (south through west-northwest directions), according to 
the submitted Fox Weather data. Located on the leeward side of the 
Santa Monica Mountains' crest, the proposed Saddle Rock-Malibu area 
receives more sunshine and has higher daytime temperatures than the 
Malibu-Newton Canyon area, which is located just southeast of the 
Saddle Rock-Malibu area on the windward side of the mountain crest and 
is, therefore, more strongly influenced by the cooling Pacific marine 
air. Also, the warm, down slope wind that affects the Saddle Rock-
Malibu area is less evident in the Malibu-Newton Canyon area.

[[Page 40399]]

Soils
    Predominant soils of the proposed Saddle Rock-Malibu viticultural 
area include Cropley clay, Gilroy clay loam and rocky clay loam, and 
Hambright loam, clay loam and rocky clay loam, according to Robert 
Roche of Roche Vineyard Consulting in his June 5, 2004, letter to the 
petitioners.
    The U.S. Department of Agriculture's Soil Conservation Service (now 
the Natural Resources Conservation Service) publication, ``Soils of the 
Malibu Area California'' (October 1967), states at pages 65 and 66 that 
Cropley clay is well drained with slow permeability. Cropley clay 
occupies nearly level to moderately sloping alluvial fans, and bedrock 
is found more than 5 feet below the surface. According to the 1967 
``Soils of the Malibu Area California'' publication, Gilroy clays are 
well drained with slow permeability. They occupy gently rolling to 
steep upland areas, and bedrock is generally found between 2 feet and 
3\1/3\ feet below the surface. Hambright clay loams, described on pages 
72 and 73 of the 1967 Malibu area soil publication, are well drained 
with moderate permeability. They occupy moderately steep to very steep 
upland areas, and bedrock is found from \2/3\ foot to 1\1/2\ feet below 
the surface.
    A comparison of the soils of the proposed Saddle Rock-Malibu 
viticultural area to those in the existing Malibu-Newton Canyon 
viticultural area shows distinct soil differences.

------------------------------------------------------------------------
                                              Established Malibu-Newton
 Proposed Saddle Rock-Malibu viticultural     Canyon viticultural area
                area soils                              soils
------------------------------------------------------------------------
Gilroy rocky clay loam and clay loams.....  Gilroy clay loam.
Hambright loam, clay loam, and rocky clay   Hambright rocky clay loam.
 loam.
Cropley clay..............................  Castaic silty clay loam.
                                            Malibu loam.
                                            Malcolm loam.
                                            Rincon silty clay loam.
------------------------------------------------------------------------

    The Hambright rocky clay loam and Gilroy clay loam series dominate 
the proposed Saddle Rock-Malibu area's northeast region, according to 
Robert Roche. He explains that although these two series are found 
throughout California, they contrast to the igneous rock found in the 
eastern area immediately beyond the proposed Saddle Rock-Malibu 
viticultural area boundary line. Mr. Roche compares the Malibu-Newton 
Canyon viticultural area to the proposed Saddle Rock-Malibu 
viticultural area by describing the Saddle Rock-Malibu area's soils as 
``deeper with more clay content overall, leading to more water holding 
capacity.'' He explains that the ``soil series and descriptions are 
different enough'' between the two areas to conclude that ``wine 
characteristics would be significantly different.'' The northeast 
corner of the proposed Saddle Rock-Malibu viticultural area, the 
petition states, has the most evident differences in soil as compared 
to the region immediately beyond the boundary line.
    The petition, however, emphasizes that soil differences of the 
proposed Saddle Rock-Malibu area play a lesser role than the climate 
and physical geography in defining the distinctiveness of the proposed 
viticultural area.

Notice of Proposed Rulemaking and Comments Received

    TTB published Notice No. 55 regarding the proposed Saddle Rock-
Malibu viticultural area in the Federal Register (71 FR 1500) on 
January 10, 2006. We received 113 comments in response to that notice. 
All 113 comments supported the establishment of the Saddle Rock-Malibu 
viticultural area, and some specifically discussed the unique geography 
and microclimate of the region.

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 ``Saddle Rock-Malibu'' viticultural area in Los Angeles 
County, California, effective 30 days from the publication date of this 
document.

Boundary Description

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

Maps

    The one map used to determine the boundary of the viticultural area 
is identified 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, ``Saddle 
Rock-Malibu,'' 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 ``Saddle Rock-Malibu'' 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 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 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 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

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

List of Subjects in 27 CFR Part 9

    Wine.

[[Page 40400]]

The Regulatory Amendment

0
For the reasons discussed in the preamble, we amend title 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 a new Sec.  9.203 to read as follows:


Sec.  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 Rock-Malibu 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 
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 1,900-foot 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.

    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