The Malibu-Newton Canyon Viticultural Area (95R-014P)

DEPARTMENT OF THE TREASURY

Bureau of Alcohol, Tobacco and Firearms

27 CFR Part 9

RIN 1512-AA07

[TD ATF-375 ]

The Malibu-Newton Canyon Viticultural Area (95R-014P)

AGENCY: Bureau of Alcohol, Tobacco and Firearms, Department of the

Treasury.

ACTION: Final rule, Treasury decision.

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SUMMARY: This final rule establishes a viticultural area in the State

of California to be known as ``Malibu-Newton Canyon.'' The petition for

this viticultural area was filed by Mr. George Rosenthal, President of

Rancho Escondido, Inc.

The ``Malibu-Newton Canyon'' viticultural area comprises

approximately 850 acres within Newton Canyon, a bowl-shaped valley

located on the south-facing side of the Santa Monica Mountains.

Vineyards currently within the proposed viticultural area are located

on the Rancho Escondido Estate. Rancho Escondido is comprised of

approximately 157 acres, all of which lie within the proposed area.

Approximately 14 of these acres are planted with premium wine producing

vineyards. Varietals include Cabernet Savignon, Merlot, Cabernet Franc,

Chardonnay and Petite Verdot. Currently, there are no wineries located

within the proposed ``Malibu-Newton Canyon'' area.

ATF believes that the establishment of viticultural area names as

appellations of origin in wine labeling and advertising allows wineries

to designate the specific areas where the grapes used to make the wine

were grown and enables consumers to better identify the wines they

purchase.

EFFECTIVE DATE: June 13, 1996.

FOR FURTHER INFORMATION CONTACT: David Brokaw, Wine, Beer and Spirits

Regulations Branch, Bureau of Alcohol, Tobacco and Firearms, 650

Massachusetts Avenue, NW., Washington, DC 20226 (202-927-8230).

SUPPLEMENTARY INFORMATION:

Background

On August 23, 1978, ATF published Treasury Decision ATF-53 (43 FR

37672, 54624) revising regulations in 27 CFR Part 4. These regulations

allow the establishment of definitive viticultural areas. The

regulations allow the name of an approved viticultural area to be used

as an appellation of origin on wine labels and in wine advertisements.

On October 2, 1979, ATF published Treasury Decision ATF-60 (44 FR

56692) which added a new Part 9 to 27 CFR, for the listing of approved

American viticultural areas.

Section 4.25a(e)(1), Title 27 CFR, defines an American viticultural

area as a delimited grape-growing region distinguishable by

geographical features, the boundaries of which have been delineated in

Subpart C of Part 9.

Section 4.25a(e)(2) outlines the procedure for proposing an

American viticultural area. Any interested person may petition ATF to

establish a grape-growing region as a viticultural area. The petition

should include:

(a) Evidence that the name of the proposed viticultural area is

locally and/or nationally known as referring to the area specified in

the petition;

(b) Historical or current evidence that the boundaries of the

viticultural area are as specified in the petition;

(c) Evidence relating to the geographical features (climate, soil,

elevation, physical features, etc.) which distinguish the viticultural

features of the proposed area from surrounding areas;

(d) A description of the specific boundaries of the viticultural

area, based on the features which can be found on United States

Geological Survey (U.S.G.S.) maps of the largest applicable scale; and

(e) A copy of the appropriate U.S.G.S. map(s) with the boundaries

prominently marked.

Petition

ATF received a petition from Mr. George Rosenthal, President of

Rancho Escondido, Inc., proposing to establish a new viticultural

appellation in the Malibu area of Los Angeles County, California, to be

known as ``Malibu-Newton Canyon.'' The viticultural area, comprising

approximately 850 acres, is located within Newton Canyon which is a

bowl-shaped valley located on the south-facing side of the Santa Monica

Mountains. Vineyards currently within the viticultural area are located

on the Rancho Escondido Estate. Rancho Escondido is comprised of

approximately 157 acres, all of which lie within the ``Malibu-Newton

Canyon'' viticultural area. Approximately 14 of these acres are planted

with premium wine producing vineyards. Varietals include Cabernet

Savignon, Merlot, Cabernet Franc, Chardonnay and Petite Verdot.

Currently, there are no wineries located within the ``Malibu-Newton

Canyon'' viticultural area.

Notice of Proposed Rulemaking

In response to Mr. George Rosenthal's petition, ATF published a

notice of proposed rulemaking, Notice No. 817, in the Federal Register

on December 22, 1995 [60 FR 66535], proposing the establishment of the

Malibu-Newton Canyon viticultural area. The notice requested comments

from all interested persons by February 20, 1996.

Comments on Notice of Proposed Rulemaking

ATF did not receive any letters of comment in response to Notice

No. 817.

[[Page 29950]]

Two letters of support from landowners located within the Malibu-Newton

Canyon viticultural area were received prior to issuing Notice No. 817.

Accordingly, this final rule establishes a Malibu-Newton Canyon

viticultural area with boundaries identical to those proposed in Notice

No. 817. The petition provides the following information as evidence

that the viticultural area meets the regulatory requirements discussed

previously.

Evidence That the Name of the Area Is Locally or Nationally Known

According to the petitioner, the origin of the name Malibu comes

from the ancient Chumash Indian word MALA I BOO, meaning ``Place on the

Cliff,'' and was the name of an Indian village just beyond Malibu

Beach. After the Spaniards took control of southern California, the

encompassing Chumash ranchera UMALIBO became known as the Malibu

Rancho. A Spanish settler, Jose Bartolome Tapia gained control of the

rancho and was later granted the land by the Governor of the

Californias. The present day spelling appears on the name of the

Topanga Malibu Sequit grant dated July 12, 1805. It originally totalled

13,315 acres, one of the largest southern California Ranchos at that

time.

The petitioner further states that throughout the 19th century,

Rancho Malibu changed hands many times but remained intact. Until the

construction of the Pacific Coast Highway in the 1930's, the privacy of

Rancho Malibu had not been invaded. With the burgeoning economy of

southern California, conditions greatly changed. This historic rancho

was finally subdivided during the same decade. Following soon after,

the famous Malibu Beach Colony was established where movie stars and

industry moguls began constructing their homes. The Malibu area then

quickly developed into the highly recognized community of Los Angeles

as it is known today.

Throughout this region there exists topography in the form of

roads, a creek, a lake, a canyon, a beach, hiking trails, parks,

vistas, etc. which denote the name ``Malibu.'' The region lying roughly

from the ridge line of the Santa Monica Mountains to the ocean, and

from Topanga Canyon to the Ventura County line is commonly known as

Malibu, according to the petitioner. While the city of Malibu was

incorporated in 1992, the entire surrounding area described above

continues to be recognized as Malibu. ``Malibu'' could be applied to

any of the hills/mountains which drain toward the ocean through the

city of Malibu, including Newton Canyon, the location of the

viticultural area.

The petitioner provided a 1:250,000 scale Topographic-Bathymetric

map of Los Angeles to document the use of the name, ``Malibu.'' An

article in the October 15, 1994, issue of the ``Wine Spectator,''

entitled ``A Vineyard Grows in Malibu Canyon,'' refers to the area

around ``The Malibu Estate'' (Rancho Escondido, Inc.) as ``Malibu

Hills.'' Also, included as an exhibit was a copy of an article from,

``The Underground Wine Journal,'' 1994, entitled, ``Distinctive New

Wines.'' This article refers to ``The Malibu Estate'' as being located

``in the hills above Malibu.''

According to the petitioner, the name ``Newton Canyon'' is

generally known as describing the specific area in which the

viticultural area is located. This is evidenced by the name of the main

street running through the viticultural area-- ``Newton Canyon Road.''

In addition, maps of the area, including the U.S.G.S. map referenced

and shown within the petition, label the area as, ``Newton Canyon.''

The petitioner states that, ``Newton Canyon alone is not descriptive

enough to describe the general location of the viticultural area, and

further, might possibly cause public confusion in relation to Newton

Vineyards, located in the Napa Valley.'' Therefore, the petitioner

proposed the name, ``Malibu-Newton Canyon.''

Historical or Current Evidence that the Boundaries of the Viticultural

Area Are As Specified in The Petition

The boundaries of the ``Malibu-Newton Canyon'' viticultural area

follow the natural ridge lines which define Newton Canyon and are

delineated on the U.S.G.S. Point Dume, California, quadrangle map.

Newton Canyon is a bowl-shaped valley located on the south-facing

side of the Santa Monica Mountains, in the Malibu area of Los Angeles

County. The canyon is oriented along an east-west axis. The valley

floor lies at an elevation of approximately 1,400 feet. The surrounding

ridgeline ranges in elevation from 1,800-2,100 feet on the southern

ocean side of the canyon, continuing to 2,100-2,800 feet on the high

side of the canyon to the north.

According to the petitioner, the elevation of the southern rim of

the canyon is low enough to allow evening fog to sift into the valley,

but high enough to keep out the marine layer that shrouds much of the

coastline throughout the daytime. The northern rim of the canyon joins

the crest of the Santa Monica Mountains that divides oceanside from

leeside. Lying at the eastern most side of the canyon, Castro Peak is

another distinguishing feature which marks one of the highest points in

the Santa Monica Mountains at 2,824 feet.

The petitioner further states that approximately two-thirds of the

surrounding Malibu area contains slopes greater than 25 percent, with

only one-fifth having relatively level terrain. Throughout the past

several decades, most of the usable land in the Malibu area has been

developed. Because of increasingly high land prices, very little of the

land in the general Malibu area is still used for agriculture. The

Santa Monica Mountains also have thousands of acres dedicated to State

and national parks, with more acreage being aggressively acquired by

public conservation agencies.

Evidence Relating to the Geographical Features (Climate, Soil,

Elevation, Physical Features, etc.) Which Distinguish the Viticultural

Features of the Area From Surrounding Areas

Climate

Based upon a 1994 climate study completed by Fox Weather, Oxnard,

California, the petitioner asserts the following: The general climate

of the Malibu area is typical of southern California with mild, rainy

winters, and warm, dry summers. However, there are several

climatological factors which distinguish the ``Malibu-Newton Canyon''

viticultural area from the surrounding region.

While summer temperatures often exceed 80 degrees in the afternoon,

cooling ocean breezes flow into the valley in the evening, according to

the petitioner. Moreover, during the evening and early morning a light

fog often filters into the valley and settles along the slopes,

creating a unique microclimate which is significantly cooler than the

surrounding inland areas. Typically, the morning sun shines through the

fog, which in turn is swept out by warm winds and high daytime

temperatures. The valley enjoys southern exposure to the sun throughout

the afternoon. According to the petitioner, these conditions are ideal

for premium grape growing.

Because of its high elevation and orientation, the viticultural

area does not experience the constantly overcast skies and cooler

temperatures of the coastal region immediately below.

Newton Canyon, within which the viticultural area is located, is a

unique pocket protected from marine influence. The coastline near sea

level is a more temperate climate controlled by marine stratus with

uniformly cold

[[Page 29951]]

temperatures, fog and low clouds. This cooler and more humid coastal

environment, mainly affecting areas below the 1,300 foot level, can

create grape rot and delay maturation.

The petitioner claims that the ``Malibu-Newton Canyon''

viticultural area is, in the daytime, a sunny warm oasis for a coastal

location. The area is located at an elevation which lies just at the

bottom of the inversion layer and just at the top of the marine layer.

Typically, the marine layer ceiling is approximately 1,400 feet on

average. The southern or bottom rim of the canyon acts as a barrier to

the marine layer, preventing the bulk of the coastal fog and low clouds

from penetrating the valley for extended periods of time. This allows

the ``Malibu-Newton Canyon'' viticultural area to enjoy favorable

cooling effects of the Pacific ocean and have the warm sunny daytime

temperatures found in the adjacent interior valleys.

Nearby inland areas experience uniformly hot summer temperatures

similar to those experienced in the upper elevations on the oceanside

of the Santa Monica Mountains. However, these inland areas receive

little or no fog and much less precipitation than the oceanside regime,

according to the petitioner.

An additional distinctive aspect is an increasing amount of

precipitation with increasing elevation. The petitioner states that

upland weather stations report practically twice the mean precipitation

of the nearby lowland stations. Furthermore, the greatest monthly

precipitation during the rainy season is from 1.5 to 3.0 times as great

as that for the lowland stations. Precipitation is concentrated in the

winter months. The average annual rainfall is about 24 inches, with

approximately 12 percent occurring from the months of April to October.

The viticultural area experiences typical low temperatures in the

winter time, just above freezing temperatures. Infrequent winter

freezes have been known to occur during the dormant winter growing

cycle.

In summary, the petitioner states that the viticultural area is

characterized by an isolated microclimate that captures the favorable

climatic conditions necessary for premium wine grape growing. In

contrast, the petitioner states that the surrounding areas found on the

oceanside of the Santa Monica Mountains (i.e, Malibu, Oxnard, Santa

Monica) are uniformly cool and overcast. Surrounding inland areas found

on the leeside of the Santa Monica Mountains (i.e, Thousand Oaks,

Agoura, Woodland Hills) are uniformly hot and dry. The petitioner

provided a diagram illustrating the ``Malibu-Newton Canyon''

microclimate and a November 29, 1994, ``CLIMATOLOGICAL SURVEY FOR

RANCHO ESCONDIDO VINEYARDS,'' by Alan D. Fox of Fox Weather.

Physical Features

According to the petitioner, the primary distinction of the

viticultural area is its unique combination of shape, elevation,

orientation and relative location to the marine influences of the

Pacific Ocean. The viticultural area lies within a clearly defined

valley with a ``bowl'' shape resting high on the oceanside of the Santa

Monica Mountains. These physical features create a pocket which harbors

the distinct microclimatic described above. The petitioner provided

aerial photos to illustrate these physical features.

Drainage

All of the viticultural area drains into Newton Canyon Creek,

continuing to Zuma Creek which then drains into the Pacific Ocean at

Point Dume's westward beach, according to the petitioner.

Soils

As evidence of soil types, the petitioner provided a 1994 soils

study completed by Soil & Plant Laboratory, Inc., Orange, California,

in addition to ``Soils of the Malibu Area California'' published by the

Soil Conservation Service, United States Department of Agriculture.

According to this information, major soils within the viticultural

area range from loam to clay loam in texture. Subsoil texture ranges

from clay loam to clay. Current plantings are mainly on Castaic and

Rincon silty clay loams and Malibu loam which are lower elevation

terrace soils that are moderately deep, with favorable Capability Class

ratings of II to IV. Steeper hillside soils (mostly above the 1,700

foot contour line) are shallower with Capability Class ratings ranging

from IV to VIII.

Soils in the viticultural area have moderate to high inherent

fertility. Soil reaction in surface soils ranges from moderately acid

to slightly alkaline. Subsoil ph varies with type and several areas are

calcareous.

According to the petitioner, soil tests performed prior to the

planting of vineyards in 1988 revealed that the topsoil found in much

of lower Newton Canyon contained crushed rock, as a result of the

construction of the nearby Kanan Dume Road tunnel, which is ideal for

good drainage.

The surrounding areas are mainly steep hillsides and mountainous

uplands with poor soil capability. These soils are usually shallower

than those found in the viticultural area, and are subject to erosion.

Boundary

The boundary of the ``Malibu-Newton Canyon'' viticultural area may

be found on one United States Geological Survey map, entitled Point

Dume Quadrangle, California, 7.5 minute series, with a scale of

1:24,000.

Executive Order 12866

It has been determined that this regulation is not a significant

regulatory action as defined by Executive Order 12866. Accordingly,

this proposal is not subject to the analysis required by this executive

order.

Regulatory Flexibility Act

It is hereby certified that this regulation will not have a

significant economic impact on a substantial number of small entities.

The establishment of a viticultural area is neither an endorsement nor

approval by ATF of the quality of wine produced in the area, but rather

an identification of an area that is distinct from surrounding areas.

ATF believes that the establishment of viticultural areas merely allows

wineries to describe more accurately the origin of their wines to

consumers, and helps consumers identify the wines they purchase. Thus,

any benefit derived from the use of a viticultural area name is the

result of the proprietor's own efforts and consumer acceptance of wines

from that area.

Accordingly, a regulatory flexibility analysis is not required

because this final rule is not expected (1) to have significant

secondary, or incidental effects on a substantial number of small

entities; or (2) to impose, or otherwise cause a significant increase

in the reporting, recordkeeping, or other compliance burdens on a

substantial number of small entities.

Paperwork Reduction Act

The provisions of the Paperwork Reduction Act of 1980, Pub. L. No.

96-511, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR

Part 1320, do not apply to this rulemaking because no requirement to

collect information is proposed.

Drafting Information

The principal author of this document is David Brokaw, Wine, Beer

and Spirits Regulations Branch, Bureau of Alcohol, Tobacco and

Firearms.

[[Page 29952]]

List of Subjects in 27 CFR Part 9

Administrative practices and procedures, Consumer protection,

Viticultural areas, and Wine.

Authority and Issuance

Title 27, Code of Federal Regulations, Part 9, American

Viticultural Areas, is amended as follows:

PART 9--AMERICAN VITICULTURAL AREAS

Par. 1. The authority citation for Part 9 continues to read as

follows:

Authority: 27 U.S.C. 205.

Subpart C--Approved American Viticultural Areas

Par. 2. Subpart C is amended by adding Sec. 9.152 to read as

follows:

* * * * *

Sec. 9.152 Malibu-Newton Canyon.

(a) Name. The name of the viticultural area described in this

petition is ``Malibu-Newton Canyon.''

(b) Approved maps. The appropriate map for determining the boundary

of the Malibu-Newton Canyon viticultural area is the U.S.G.S. map,

``Point Dume Quadrangle, California'' (7.5 Minute Series 1:24,000

Topographic map, photorevised 1981).

(c) Boundary. The Malibu-Newton Canyon viticultural area is located

in Los Angeles County, California. The boundary is as follows:

(1) Beginning at the intersection of the Newton Canyon creek

(lowest elevation) and an unnamed medium duty road referred to by the

petitioner as Kanan Dume Road at the boundary of section 13 and 18 on

the U.S.G.S. map ``Point Dume Quadrangle.''

(2) Then south along Kanan Dume Road to the point where an unnamed,

unimproved dirt road referred to by the petitioner as Ramerez Mountain

Way crosses over Kanan Dume Road at the tunnel in the northwest corner

of section 19.

(3) Then east along Ramerez Mountain Way, following the southern

ridgeline of Newton Canyon, to Latigo Canyon Road in the southwest

corner of section 17.

(4) Then south along Latigo Canyon Road to an unnamed, unimproved

dirt road referred to by the petitioner as Newton Mountain Way at the

southern boundary of section 17.

(5) Then northeast along Newton Mountain Way, following the

southeastern ridgeline of Newton Canyon, to an unnamed, unimproved dirt

road referred to by the petitioner as Castro Mountain Way in section

16.

(6) Then west along Castro Mountain Way, past Castro Peak,

following the northern ridgeline of Newton Canyon to Latigo Canyon Road

in section 18.

(7) Then southwest along the natural ridgeline of Newton Canyon to

the intersection of Kanan Dume Road and the 1,600 foot contour line in

the southeastern portion of section 13.

(8) Then southeasterly along Kanan Dume Road to the beginning

point.

Signed: May 7, 1996.

Bradley C. Buckles,

Acting Director.

Approved: May 24, 1996.

John P. Simpson,

Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).

[FR Doc. 96-14857 Filed 6-12-96; 8:45 am]

BILLING CODE 4810-31-P