Adjacent states would be able to use another state’s appellations

On Feb. 9 the Alcohol and Tobacco Tax and Trade Bureau (TTB) published a proposal in the Federal Register that, if approved, would significantly alter the nation’s wine labeling laws. The proposal, issued in Notice No. 147, would allow wineries in adjacent states to use the other state’s appellation names on wine labels.

Under existing law, wineries may only use an appellation name on a label if the wine is “fully finished” in the state in which the appellation lies. That is to say, California wineries, for example, cannot vinify Willamette Valley fruit and use this appellation on the label unless the wine is “fully finished” in Oregon. If the TTB proposal becomes law, wineries in any adjacent state would be able to use the other state’s appellation names as long as it is a single-state appellation.

The proposal was driven by the approval of The Rocks District of Milton-Freewater appellation, which was issued on the same date. The Rocks District is an Oregon appellation that is a sub-appellation of the Walla Walla Valley, which spans the Washington-Oregon border. Due to existing laws, Washington-based Walla Walla Valley wineries – which constitute the vast majority of wineries in the area – would be unable to use The Rocks District on their labels.

In addition to addressing the problems presented by the approval of The Rocks District, the government wrote that the intention of the proposal is: to provide wineries with increased flexibility in where wines are produced and how they are labeled; to give consumers more accurate information about the origins of wines; and to allow growers to have more potential buyers.

Initial comments on the proposal have been mixed. Nicolas Quille, general manager of Pacific Rim Winemakers in Washington, sees the proposed changes as beneficial. Pacific Rim currently purchases fruit from the Willamette and Umpqua valleys. At present, the winery is forced to use an “Oregon” designation on its labels rather than the more specific Willamette Valley and Umpqua Valley designations.

“The change of rule would allow us to more accurately reflect the origin of our wines to our customers,” Quille wrote in response to the government’s proposal. He went as far as to suggest that the geographic limitations be removed completely.

Others wrote that the TTB’s proposal was too broad. “To allow an unfettered adjacent state rule has the potential to dilute the identity and meaning of AVAs within the United States system, and could impact export markets’ opinion of American wines,” commented Casey McClellan of Seven Hills Winery in Walla Walla, Wash.

Of note, the government’s proposal would only apply to single-state appellations, not multi-state appellations. “(W)inemakers who label their wines with a multi-state AVA appellation of origin already have the flexibility to use winemaking facilities, including custom crush facilities, in at least one other state if they choose, unlike winemakers who label their wines with a single-state AVA appellation of origin,” the proposal stated. However, the TTB encouraged comments as to whether the changes should also apply to multi-state appellations as well.

The comment period for the proposal ends April 10. To submit comments, visit www.ttb.gov/wine/wine-rulemaking.shtml.