Wines & Vines Home
   
 
Welcome Guest
LOGIN |  CREATE ACCOUNT
 
ADVERTISEMENT
 
 
 
08.01.2007  
 

AVA Approvals Suspended

Bureau considers revamping application process

 
by Jane Firstenfeld
 
 
AVA Approvals Suspended
Washington, D.C. -- The Alcohol and Tobacco Tax and Trade Bureau (TTB) may go back to the drawing board with its requirements for creation of certain new American Viticultural Areas (AVAs), revisiting procedures that have been on the books since 1986. The current rules have resulted in the creation of more than 180 recognized growing areas throughout the country, so-designated because of distinct climate, geology and other characteristics. In recent years, producers in large, established AVAs have sought and received ever-more exclusive sub-appellations, using these to promote growing areas considered more prestigious--or simply different--than neighboring vineyards. Grower organizations can spend tens or hundreds of thousands of dollars to document their proposed AVAs; each proposal is considered by TTB and open to public comments, which are also evaluated.

If the system's not broken, why does TTB want to fix it? Apparently, it all comes down to a single request seeking to further subdivide the nation's most revered wine region by creating the Calistoga AVA in the northern Napa Valley. The Calistoga sub-appellation was proposed in 2005 (TTB Notice No. 36), and drew only two--positive--comments before the official comment period ended on May 31, 2005. Subsequently, however, two more comments arrived, one from an attorney, another from a director of Calistoga Estate, each adamantly opposing the proposal.

Early this year, Wines & Vines received comments from Calistoga readers, protesting the TTB's delay in approving their new AVA, which, as Napa Valley's 15th sub-appellation, was assumed to have been a slam-dunk. At that time, TTB director of media affairs Art Resnick explained that even a single negative comment could cause an application to be denied.

The federal foot-dragging continued, and this spring, the Napa Valley Vintners (NVV) began lobbying efforts to win approval, going direct to TTB administrator John Manfreda and his boss, Secretary of the Treasury Henry Paulson. NVV also asked that Napa's U.S. Representative Mike Thompson step in on its behalf. "He's our congressman, and does a great job representing the industry," NVV communications director Terry Hall told Wines & Vines. "We asked him to find out 'what's the deal?'"

Wheels Turn in Washington

On June 19, Thompson received a letter from Kevin I. Fromer, assistant secretary for legislative affairs at the Treasury Department. In a copy forwarded to Wines & Vines by Hall, Fromer states that "Satisfying the regulatory requirements for filing a petition is not necessarily sufficient for the establishment of a new AVA. The Treasury Department makes a determination….on the basis of evidence presented in the petition and on all other relevant information gathered through the public comments received during the rulemaking process or from other sources. This information may include views on the impact that the proposed AVA might have on other parties, such as existing businesses and industry members."

Interestingly, apparently TTB gives equal weight to comments received after its own deadline: The attorney's letter of opposition arrived about a month too late, while the letter from Calistoga Estate arrived in January 2007: 18 months after the comment period closed.

Although brand names established prior to the current AVA system took effect were "grandfathered in," "This solution…does not address conflicts between AVAs and brand names that came into existence after July 7, 1986," Fromer continued. "These post-1986 brand names…are frequently built up over a period of time by substantial investments of capital and hard work. They can attain significant value in and of themselves. This value may then be threatened by a proposal to establish an AVA….The AVA name then becomes 'viticulturally significant.' This in turn may result in a serious restriction on the brand-name holder's ability to use the name because of the requirements to source raw materials for wine production…to materials grown within the new AVA….

"The current Calistoga petition is an example of a petition that would affect an established brand, and asks for establishment of an AVA within an AVA," Fromer went on. "The complexities of these issues have led us to suspend action on approval of this and other similar petitions while we consider revising the existing regulatory approach."

On July 19, Rep. Thompson and 53 other members of the U.S. Congressional Wine Caucus sent a letter to Secretary Paulson and Administrator Manfreda, responding forcefully to Fromer's explanation and proposed revisions.

"We strongly oppose this course of action….These regulations have served to inform and protect the American public. We see absolutely no reason to suspend the regulations regarding AVAs, or to focus specifically on AVAs within AVAs that account for the majority of the existing and pending AVAs. These regulations, which were established after long deliberation in consultation with the wine industry, are clear and unambiguous.

"The foundations of the AVA program are to provide consumers with accurate information about wine origin and to protect consumers from false and misleading marketing of wine with respect to origin. The regulations clearly accomplish these goals, and make wine producers aware that their future use of geographic brand names would be limited to wines from the named place.

"In addition, your proposed suspension of the existing rules related to AVAs, including halting all processing of petitions for AVAs within AVAs, will create chaos in the wine industry, and deprive many wineries with pending petitions of their rights under your current regulations….Should it be necessary, we will also request that the Ways & Means Committee hold an oversight hearing to study this issue further," the representatives concluded.

Terry Hall at NVV also had strong words for the bureaucrats. "You can't just decide arbitrarily to stop decision-making," he said. "You must do the business you are paid to do. You can't just decide one day that it's too hard to answer the phone, so you won't do it anymore."

Hall suggested that the timing for this decision--or lack thereof--is especially inopportune, given recent strides by the U .S. wine industry. "America is poised to become the largest wine consuming nation in the world," he said. "Our industry has worked hard to build worldwide credibility. It's a slap in the face of growers, vintners and certainly consumers, who are really driving the business."

He noted that Napa had recently achieved coveted Geographic Indicator (GI) status with the European Union, and that NVV and other U.S. regions are working with the EU to protect names of geographic significance. "We also, as a government and a people, have just entered into the second phase of wine accords with the EU, and are trying to figure out a way to move forward with our shared agenda," he said. "What message is this sending to our trading partners?"

Resnik at TTB had just returned to his desk after a few days off when Wines & Vines reached him today. He had not yet seen the letter to his bureau from the Wine Caucus, but did suggest that the TTB would not suspend action on all AVA application, just those for sub-appellations, and those affecting existing brand names (presumably including Calistoga Estate).

"We anticipate heading into rulemaking in the near future, and will solicit comments as to if and even how we should change the procedure," he said. "We don't know where we go from there; we'll have to see. Once we publish the notice, it will be open for comment for 60 to 90 days. I was told today this will happen in the near future."
SHARE »
Close
 
Currently no comments posted for this article.
 
CURRENT NEWS INDEX »


 
Wines & Vines Home
 
866.453.9701 | 415.453.9700 | Fax: 415.453.2517
65 Mitchell Blvd., Ste. A San Rafael, CA 94903
info@winesandvines.com
Wine Industry Metrics
 
Off-Premise Sales » Month   12 Months  
November 2014 $708 million
5%
$7,844 million
6%
November 2013 $673 million $7,428 million
     
Direct-to-Consumer Shipments » Month   12 Months  
November 2014 $274 million
21%
$1,799 million
16%
November 2013 $225 million $1,558 million
     
Winery Job Index » Month   12 Months  
November 2014 127
-5%
226
15%
November 2013 134 196
     
 
MORE » Released on 12.15.2014
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 

FEATURES
 

Practical Winery & Vineyard Library
 
Search the PWV archive »
 
 

Direct To Consumer
Wine Shipping Report
2014
 
Download full report »
 
 

CALENDAR
  • January 7
     
    Putting Your Brand to Work
     
  • January 9-18
     
    Icewine Festival
     
  • January 13-16
     
    VinCO
     
  • January 14-15
     
    Direct-to-Consumer Wine Symposium
     
  • MORE »
 

READER COMMENTS
 
Article: Grape Industry Lukewarm on Immigration Act »
 
A band-aid it may be but instead of the negative tone of this article which...
Reader: Guest
 
Article: Oregon Wine Institute Plans for the Future »
 
When Mark is involved, things are going to work out just great! We miss the...
Reader: Peter Bell
 
Article: Spanish Cooper Sells Chinese Oak »
 
I would love to find Us wineries using the Chinese oak barrels. Do you know...
Reader: Guest
 
Article: Prohibition Laws Linger 81 Years Later »
 
Trader Joe's (Union Square) and Whole Foods (Upper West Side) both have wine shops attached...
Reader: Guest
 
Article: Prohibition Laws Linger 81 Years Later »
 
Maybe the economy could use another boost by repealing the post-prohibitionary laws too. Make it...
Reader: csm noble
 
 


Directory/Buyer's Guide — Your Wine Industry Marketplace
 
 
WINERY SEARCH
 
 
Advanced Search »
SUPPLIER SEARCH
   by Product
 by Company Name or Brand
 
Browse by Category »
2015 Directory/Buyer's Guide
The Wines & Vines Directory and Buyer's Guide
 
 
EXPANDED ONLINE SEARCH INCLUDED WITH PURCHASE
 
ORDER NOW »
 
LEARN MORE »
 
 
Wines & Vines Magazine
 
 
LEARN MORE »
 
SUBSCRIBE »
 
Digital Edition Now Available!
Wines & Vines Digital Edition Now Available
 
LEARN MORE »
 
ORDER NOW »
 
 
The Wines & Vines Online Marketing System
 
The Industry Standard winery marketing application
 
FREE LIVE DEMO »
 
VIEW VIDEO »
 
 
 
 
Latest Job Listings
 Tax Accountant
 Ceres, CA
Finance
 Regional Manager
 Seattle, WA
Sales and Marketing
 Inventory - Warehouse ...
 Rutherford, CA
Winemaking and Production
 Sales Trainer
 Montvale, NJ
Sales and Marketing
 Sales Manager
 Napa, CA
Sales and Marketing
 West Coast Regional Sa...
 West Coast, CA
Sales and Marketing
 Tasting Room Sales Ass...
 Sausalito, CA
DTC, Tasting Room and Retai
 Order Checker
 Lodi, CA
Winemaking and Production
 Senior Wine Sales
 San Rafael, CA
Sales and Marketing
 Manager Wine/Beer/Gour...
 Rockville, VA
Sales and Marketing
 
More Job Listings >>
Follow Us On:
 
 





Home  |  About Us  |  Editors  |  Subscribe  |  Print Edition  |  Digital Edition

Advertise  |  Site Map  |  Contact Us  |  Privacy Policy
 
 
Copyright © 2001-2014 by Wine Communications Group, Inc. All Rights Reserved.
No material may be reproduced without written permission of the Publisher.
Wines&Vines does not assume any responsibility for any unsolicited manuscripts or materials.